Whether you are a start-up or a growing business, at some time or another you might be presented with some bad business advice. Whether this comes from a business partner, mentor or senior executive, sometimes it can be the wrong advice. The problem is being able to spot bad advice, before it is too late and causes significant damage to your business.
Here are five ways you can make sure that your business is protected from the impacts of bad advice.
1. Could you take it to the bank?
By this, we mean that if something sounds too good to be true, it most probably is! Advice that lays out a golden path to riches with little to no risk to your business is most probably never going to work, but if you are feeling seduced by this type of advice, always do your research. Never take one person’s advice if it promises to make your fortune, and don’t be afraid to say ‘no’, if it doesn’t feel right.
2. Do they have the expertise to give this advice?
Some people are creative and can come up with lots of wild ideas to make money or grow a business, but is this what you really want? Forging a path with an innovative approach to your industry is all fair and good, and this approach has made many a person very, very rich (think about Microsoft and Apple), but even creativity needs to be founded in logic and expertise. Never rush headfirst along a path until you are very sure that it’s the right decision to take for your business.
3. Do they have different motives?
Some people will look at your business and think of strategies that will benefit themselves far more than your business. That’s not to say that their advice is bad, just that it might not be the best advice you should follow. You need to think of all the possible outcomes of their advice and where it could lead your business, before embarking on this new path. It’s all about research and knowing how this advice could benefit them more than you.
4. Can you trust them?
In business, most things come down to trust and where advice is concerned, trust is even more important. That doesn’t mean to say that you should turn everything upside down just because someone you trust suggests that you take a different path; it means that you give them the benefit of the doubt, listen to what they have to say, and then do your own research.
5. Is their advice based on opinion or fact?
Whilst an expert’s opinion is worth listening to and acting upon if valid, facts have much more value in a business environment. The best way to deal with someone’s opinion is to do your own research and find out the real facts of the matter. If these facts support their opinion, then all well and good, but if you can’t find any supportive evidence, then it might be too big a risk to act on their advice.
If you are seriously risk adverse, maybe it’s time to review your business insurances?
To decide what type of insurance policies are suitable for your business talk to an insurance specialist today.