If you’ve ever wondered why businesses fail, a recent study has the answer. In two words: bad management.
This data comes from an industry trade group that restructures bad businesses: the Association of Insolvency and Restructuring Advisors (AIRA). According to their statistics:
The majority of business failures (67%) are caused by internally-generated problems within the control of management – not by bad luck and external events like an economic recession.
To see this in bold terms, just check out this infographic from one blogger:
We all know businesses fail. Yet this analysis shows that the reason businesses fail is not usually bad luck or economic factors, but mismanagement. Does it seem like a major jump to recognize the importance of experiencing failure to understand how to make better decisions?
The old quote applies:
Good judgment comes from experience. Experience comes from bad judgment.