How you answer this single question is an excellent predictor of how well your business will perform both in the current challenging environment and over the long term. In a series of interviews that I conducted with over 50 business owners, I asked this question and discovered in their answers a common key to business growth and success that applies across industry sectors and in spite of the external environmental challenges faced by every
In a word, the difference between growth and success in business and a constant state of struggle is largely determined by one critical element: mindset.
Generally, people can be identified as having one of two mindsets towards their ability to achieve success – whether that success is in business or any other endeavour. People with what is known as a growth mindset believe that an individual’s basic abilities can be cultivated through their own efforts. They believe that anyone can change and grow through application and experience. To someone with a growth mindset, qualities like intelligence are a starting point, but success
comes as a result of effort, learning, and persistence. This is the mindset I most commonly observe amongst business owners that describe their businesses as successful.
This growth mindset is directly opposed to what is known as a fixed mindset. I have frequently observed a fixed mindset in business owners who describe their businesses as struggling. To someone with a fixed mindset, personal aptitude is carved in stone. Whatever skills, talents, and capabilities you have are predetermined and finite. Whatever you lack, you will continue to lack.
There is a huge difference between these two mindsets and this single factor has an enormous impact on business performance.
This difference goes far beyond the matter of an individual’s level of pessimism or optimism. In my experience, business owners who exhibit a growth mindset are more likely to think about their businesses differently to those with a fixed mindset in two critical ways.
Firstly, owners with a growth mindset see their businesses as a collection of assets, not just an
income stream. This results in a constant search for ways to improve the internal operations of their business to maximise its ability to generate long term returns. On the other hand, owners with a fixed mindset are far more likely to look only at the income they are generating from the business.
That is why so many business owners are trapped in a situation where they have “bought themselves a job”.
Secondly, owners with a growth mindset look at everything they do in their business as an
investment. They ask, “If I invest my money/time/effort in this way, what will be the likely return on that investment?” The first question asked by someone with a fixed mindset given the same set of options would be “What is this going to cost me?” Again, the difference is subtle, but it colours every aspect of the management decision making process and impacts on overall business performance.
If you’re looking to grow and improve your business, it is well worth while to consider whether you have a growth or a fixed mindset and ask yourself some critical questions about what impact that is having. Based on what I’ve observed in over 15 years of working with businesses of all shapes and sizes, the honest answers to some hard questions can determine whether your business thrives or simply struggles along.