How Honesty Affects an Entrepreneur’s Ability to Succeed
Picture this…
You’re on a flight caught up in a storm. The plain keeps wobbling. Passengers with weak stomachs are doing their best to fight motion sickness.
A look outside the window. It’s pitch black, once in a while you’ll see the odd thunder flashing among dark clouds.
But don’t worry, the pilot of the plane is very honest. So much so, when he talks in the cabin radio, he says:
“This is your captain speaking. I’ve never experienced such a storm, the plane is going out of my control. Right now, I don’t think we’ll get out of this alive. God help us — if he exists.”
You and your fellow passengers would look at each other for a second, perplexed, then some would panic and scream. Others would curl up in a ball on their seats. I personally would try to rush into the cockpit to question the pilot.
Most people would suppose that the pilot did the wrong thing by being honest with you about the situation. He should have lied and said that things were fine.
If you’re an entrepreneur, I don’t think you should follow that line of thinking.
Read on to find out:
- Why most entrepreneurs are dishonest with themselves and with others.
- How you can use honesty to make your business better (especially when it comes to marketing and sales.)
- The main reason why large companies fail (I’ll shed a truth about the downfall of Blockbuster that is not often talked about.)
3 Ways To Use Honesty To Give Yourself An Edge
It’s not a lie that plenty of entrepreneurs tell lies to get themselves an edge. Not a year goes by that a Bernie Madoff or an Elizabeth Holmes (from Theranos) is discovered. This year we even had a full cast of people like that, in the docuseries Tiger King.
And that’s a good thing, for us honest entrepreneurs.
Lies are so short-lived that as soon as we hear something that sounds incredible, we say “That’s too good to be true” and wait for the truth to be revealed.
Honesty saves you from the horrible fate many lying entrepreneurs will go through when their lies catch up to them.
So, here are different ways you can use honesty to give yourself a slight advantage in today’s marketplace.
1. Be honest with yourself
This is the hardest step of all. Your mind doesn’t want to change. It likes to stick to its own beliefs.
Self awareness is a rare skill that everyone who’s successful long term possesses. In business, you come across obstacles every day. Your ability to overcome them is rooted in your beliefs, not in your skills or background.
2. Be honest with those around you
There’s a strange feeling we get when we tell the truth to someone else. It’s like dropping a boulder after carrying it for 10 miles.
People who lie, believe that saying what they think a person wants to hear will get someone’s trust. Most times it does.
It’s a high risk, high reward situation: if you get caught, that person (be it a customer, a partner or an investor) will not want to deal with you ever again.
Business is a long term game. Being honest with other builds long term relationships — and the best relationships.
3. Be honest about those around you
Sometimes, we can be so attached to our thinking, we forget that other people have different life experiences, different points of views.
My ex-boss used to call me lazy because I like getting things done right before the deadline even if I get the same result I would have gotten if I started much earlier. He just didn’t want to see things my way and that was fine.
Generous entrepreneurs have better relationships with their customers, employees, partners and everyone who they do business with.
Lack Of Honesty Takes Companies Out Of Business
Netflix was not an overnight success.
They were years in the making before going global. In fact, back in 2000 the founders of Netflix, Reed Hastings and Mark Randolph, approached the then giant in their industry: Blockbuster.
They made John Antioco, the CEO of Blockbuster, an offer to sell their company for $50 million — at a time when Netflix was just mailing DVDs. That is 1/2600th of their current value.
Reed and Mark’s offer was rejected. They were laughed out of the meeting with the CEO.
In a few years, Blockbuster saw the opportunity in Netflix’s business model and began replicating it, with success. For a while, customers used both services.
Then businessman Carl Icahn came in…
A ruthless investor, who buys majority stake in companies and forces them to his will.
He told the executives that Blockbuster’s model of charging late fees and using physical stores. They were forced to stop mailing DVDs and go back to a failing model.
Icahn wasn’t being honest with himself about the changing times: customers didn’t want to pay late fees or have to drive to a store that might not have the movie they were looking for.
And by being dishonest with himself, Icahn was dishonest with the shareholders and with CEO, John Antioco, who was working on a deal to increase their online presence when the takeover happened.
John and the employees were left with a sour taste in their mouths, forced to watch a company they had worked hard for, get run to the ground at lightning speed.
The company went bankrupt about a year later, we all know what happened after that.
Why are stories like that so common? (ex. Polaroid, Toys R Us, Netscape, etc.)
Because people who become successful think the way to stay successful is to keep doing what they’ve always done.
“What got you here, won’t get you there” — Marshall Goldsmith, Executive leadership coach and author.
Massive Fortune 500 companies end up stuck in the mud because their leaders don’t want to be honest with themselves.
Your entrepreneurial journey will take you where you’ll be faced with similar make or break decisions. The way out of those kinds of situations is an extreme level of honesty.
How To Avoid The Pitfalls
“Entrepreneurship is 10% about business, 100% about people and 1000% about mindset.” — Peter Kozodoy
Being entrepreneurs, we tend to think we can change ourselves if we just read enough self-help books, start good habits and work really hard.
It’s possible, but it requires a high level of willpower sustained for months or years unless you use one of the best forms of therapy available for all entrepreneurs: talking to other entrepreneurs.
I used to be diffident about talking business with other people because, in my experience, most business people try to sell you something if you talk to them long enough. I was being dishonest with myself.
There are some amazing entrepreneur groups online and offline that are filled with people who’ve gone through what you have. If you can’t find them, can you build one yourself?
When you’re in the group, share your story, be honest and vulnerable, not so they can pat you in the back and feel sorry but to allow those who’ve gone through similar experiences to offer their point of view and ideas on how to go through it.
Doing so could also help you find entrepreneurs in the group who have the same problem but were too shy to share their situation. Who knows? You might make some friends this way.
It doesn’t matter if they’re not in your industry. Entrepreneurs are entrepreneurs. Just try to make sure there are people in the group who’re ahead of you in business.
What The Airplane Pilot Should Have Done
Remember our honest pilot? He scared everyone on the plane when he said:
“This is your captain speaking. I’ve never experienced such a storm, the plane is going out of my control. Right now, I don’t think we’ll get out of this alive. God help us — if he exists…”
I don’t think there was anything wrong in that level of honesty. In fact, if he wanted to go extreme with the honesty, he would have added:
“… I promise you that if there’s even the smallest chance for us to make it, the crew and I will take that chance and succeed, no matter what. But we can’t do that if we’re worried about your safety so please stay calm, strap your belts, rest your backs and be patient. Thank you.”
An individual with such levels of honesty makes for a great pilot and a great entrepreneur.
Customers trust honest entrepreneurs. Talented employees want to be led by honest entrepreneurs. Society is craving for honest entrepreneurs.
Don’t be fooled by dishonest people who are successful. Their success won’t last long and on their way down they’ll have to face people they wronged.
Honest entrepreneurs fail too, but on their way down, they get lifted back up by those they’ve helped.
