It used to be that people thought there was only one way to be a successful business owner. You had to be “smart” – the kind of smart that’s measured on an IQ (intelligence quotient) test. It was thought that the higher your IQ was the more likely you were to be successful.
Fortunately, that way of thinking has been proven wrong. There are many types of intelligence, and we’re all better at some of them than others. An entrepreneur can increase their chances for success by understanding their strengths and weaknesses in each category, and using that knowledge to their advantage.
Here are a few of the more common kinds of smart based on the typical small business owner, each with its own pros and cons. Most people are combinations of the different types, with 1 or 2 being the most dominate.
These are the people who have the ability to figure out mechanical or technical things. They can help a customer figure out the best tolerances for their new product. They’ll tear apart a mother board and rebuild it better than before. They’re able to rewire a building, up to code, with incomplete schematics.
Pros: Mechanically smart people thrive in environments where they are mostly left alone and can work at their own pace. They tend to be self-motivating, conscientious, independent and dependable.
Cons: Successful owners have to be able to establish on-going, effective interactions with partners, employees, customers and vendors. Their desire to work alone doesn’t serve the business well. Overall, they can struggle with personal interactions, creating and enforcing accountability, and motivating a workforce.
Language smart people know how to use words to motivate, support and inspire others. They’re the writers, public speakers, educators and employers who communicate well and often. They give good presentations, write the business plans which raise venture capital and are able to explain complicated ideas simply.
Pros: They have the ability to get information across matters. Lack of communication is one of the biggest complaints workers, in all types of businesses, have about their bosses; but language smart bosses understand the importance of keeping others in the loop.
Cons: They spend too much time communicating (meetings, memos, emails, texts) and not enough time on other parts of their job (selling, quality control, financials, human resource issues, customer service). They believe talking or writing “at” others is managing – not getting that listening is the other half of the communication process.
Number smart entrepreneurs understand profit, loss, and margins. Their estimates and bids are based on data, not guesses. They know how to “do the math” and use financial information to make plans from start-up costs to exit strategies.
Pros: Number people have a natural advantage that others don’t, and they’re more likely to outlast their competitors. The lack of number smarts is one of the biggest problems most owners have. It’s estimated that 80% of businesses fail in the first 5 years because they didn’t know, or didn’t care, how important the math is.
Cons: We’ve all known the guy who sits in his office and crunches the numbers, but ignores other aspects of his business. He has the same cons as the mechanically smart owner. In addition, he believes too much in the numbers and can overlook the human aspects of his decisions.
Owners who have this kind of smart enjoy, and are energized by, working with people. Their qualities include: having good social skills, being able to “read” others, easily interacting with many types of individuals and being well liked. Employees and customers describe them as having the ability to put others at ease and draw them out.
Pros: Owners who are people smart create great loyalty in their employees, have good customer service skills and get “pumped up” spreading the word about their products. Also, they provide a good image for the company and its brand.
Cons: People smart owners can focus too much on personalities, while finding day to day operations dull. Every day several companies close because the charming, Mr. Personality owner didn’t know how to make a profit, wouldn’t manage his employees, and ignored quality and production problems.
To be a smart business owner, you will understand which kinds of smart you are. You’ll learn to focus on your positives and overcome or compensate for the negatives. The more you know about yourself the greater the chance is that you’ll be successful.
At Cogent Analytics, we never stop looking for ways to improve your business and neither should you. So, check out some of our other posts for helpful business information: