5 annoying habits of entrepreneurs

(FSB Magazine) -- Marshall Goldsmith arrives in the Manhattan offices of FSB wearing his signature outfit: a green polo shirt, khakis and moccasins. It's 28 degrees outside, and he doesn't have an overcoat. That doesn't faze Goldsmith; nothing really does, because this executive coach is one of the most upbeat individuals on earth: "I don't care about the cold. I'm returning home tonight to San Diego."

Goldsmith is here to discuss his new book, with co-author Mark Reiter, "What Got You Here Won't Get You There" (Hyperion, $23.95), which in February climbed onto The New York Times bestseller list. The book describes Goldsmith's work with some of the world's top executives - he has coached J.P. Garnier, the CEO of GlaxoSmithKline (Charts), and Alan Mulally, the new CEO of Ford (Charts) - and how he has helped them change their behavior, improving how they communicate with their underlings.

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Goldsmith also works with entrepreneurs, including Jonathan Klein, who started Getty Images. In an interview with FSB editorial director Brian Dumaine, Goldsmith dissects five common (and particularly annoying) habits that he says can hold back even the best small-business owner.

When you work with entrepreneurs, what most often keeps them from becoming great leaders? A classic problem for them is that they are too competitive. They like winning too much. Say you've had a hard day at work; you come home and your partner says, "I had a hard day today." You say, "You had a hard day! You had a hard day! You wouldn't believe the kind of day I had." They're so competitive that they have to prove they're more miserable than the person they live with.

But why does that matter? Stop, stop, stop. Don't start sentences with "but," "no," or "however." The overuse of these negative qualifiers secretly says to everyone, "I'm right and you're wrong." "No," "but," or "however" means disregard everything that came before this word. Basically what you're telling the person is shut up. So every time you do it today you're going to owe me $20.

But ... That's $40.

Okay, explain why wanting to win all the time is harmful. How do you think your spouse feels when you tell her that your day was harder than hers? It's the same in the office with your employees. Your need to win can make them feel bad about themselves.

One thing entrepreneurs have to realize is that their suggestions are orders. One CEO told me, "If I want my words to be orders, they're orders. If I don't want them to be orders, they're still orders. So before I speak, I stop, breathe and ask myself, 'Is it really worth it?' About half the time I conclude, 'Am I right? Yes. Is it worth it? No.' "

So before you speak, ask yourself, "What's more important? Me winning this point or my relationship with this person?"

The consequences of this kind of behavior are clear. Good people leave; they get upset and they feel demeaned. And for what? Often nothing, just ego issues. In a small manufacturing business on the West Coast, a top engineer got sick of the owner saying, "I'm right, you're wrong, I'm right, you're wrong." The engineer didn't want to leave the company, but it was too psychologically annoying, so he joined a competitor.

Another problem you cite is the tendency to add too much value. Some might think that's a good thing. It's actually a classic problem for entrepreneurs, who typically know a lot about their business. That is a blessing; it is also a curse. You're the boss. I'm a young, smart and enthusiastic employee, and I come to you with what I think is a great idea. Instead of saying, "That's a great idea," your tendency is to say, "That's a great idea, but ..."

Here's the problem: The quality of the idea may go up 5 percent, but my commitment to its execution may go down 50 percent, because now it's your idea, not mine. It's hard for an entrepreneur to realize that the effectiveness of execution is a function of the quality of the idea times this human being's commitment to make it work. We get so focused on trying to improve the quality that we forget about what we're doing to commitment.

One bad habit you identify as particularly hard to kick is playing favorites. None of us think we play favorites. Every leader, every entrepreneur I've known, says they hate suck-ups. If everyone hates suck-ups so much, how come so much sucking up goes on? We've created environments where people learn to suck up to us, and we don't know we encourage it.

In my coaching classes I ask, "Who owns a dog that you love?" A number raise their hand. I ask them the names of their pets, and they all get excited talking about their dogs. Then I say, "All right, who gets the most unqualified, positive recognition in your home, your husband, wife, partner, your kids or your dog?" Some 80 percent of the time it's the dog. Why? The dog doesn't talk back, doesn't give me negative feedback, he's happy to see me, he wags his tail. He's a suck-up.

Sounds like human nature. What can you do about that? To avoid playing favorites, ask yourself four questions. First, how much do your employees actually like you? You don't know how much they like you - it doesn't matter. It's how much you think they like you. Second, ask how much are they like me? Owners who are engineers are often guilty of this. They'll say, "The employee may be a jerk, but that's okay, because he's one of us, he's an engineer. "How much do they remind me of that ever so wonderful me? Third, how much do they contribute to our company, and fourth, how much personal recognition do I give them?

If we're honest with ourselves, recognition is more highly correlated with question one or two than it is with three. We fall into a trap where we're teaching people to suck up to us. In another West Coast small high-tech company, a technically brilliant engineer hires a technically brilliant engineer. And he keeps hiring engineers and wondering why sales and marketing aren't doing all that well. He hired all geeks.

Entrepreneurs, almost by definition, are obsessed with achieving their goals. You say that can cause difficulties. I worked with a guy on Wall Street who was clocking 80 hours a week, and he said he was doing it because he needed to make a lot of money. When I asked him why, he said that he'd been married three times, and "Do you know how much alimony I pay?" Then I asked, "Why have you been married three times?" He replied, "None of my wives understood how hard I had to work."

A lot of entrepreneurs bust their butts for years to acquire worth, ruin their marriage, and 50 percent of everything they made - at least here in California - is gone. How smart is that? They get so wrapped up in a goal they forget other things that were more important.

Entrepreneurs kill themselves, literally. They work themselves to death, they don't get physical exams, their health goes straight to hell. For what? You have to find balance.

But entrepreneurs by nature are goal obsessed. Now you owe me $60.

Are you an entrepreneur who can relate to these habits? Can you name other annoying habits? Let us know. Write to the editors at fsb_mail@timeinc.com.