America's Best Business Practices

So true.

Counterfeit competence also leads the new entrepreneur to believe that he can set up his own accounting system and do the bookkeeping. What a mess, and as a result the business owners has no idea how their business is doing.

Interesting information in this article. Reminds me of what I ask myself when someone pompous brags about how wonderful they are. I always wonder if they actually believe their own b**l s**t. LOL

The problem you describe with small business owners and CEO’s who think more highly of themselves than they should – “counterfeit competence” – is how does one get through to them that they are not as great as they think they are? For some people, deep psychological evaluation and therapy is the only thing that might help because the arrogant attitudes are often actually covering up some major deep insecurities. But before someone can be helped, they have to recognize that there is a problem that needs fixing right?

Your comments about first impressions are also right on the mark. Biases are hard to overcome but necessary if one wants to hire a truly competent employee. Good hiring decisions take good insight which not everyone has.

I’ve been saying for years, after having worked with many different people and in various companies…. there are way too many people “who don’t know what they don’t know”. I was often left shocked and flabbergasted by decisions made by this oblivious group and the bad domino effect on business and fellow employees caused by their incompetence.

The words “I don’t know” (and “I’m sorry”- but I digress) are hard to say for quite a few people…. but we’re dealing with a mentality that doesn’t even realize this. SCARY!

After working for Fortune 100 companies most of my professional career, I find this problem not just secluded to the small business sector, but rampant among large enterprise businesses and a breeding ground for this “epic fail.” People that have a clue learn from their mistakes, but these idiots have learned to spin, blame others, divert, and take credit from those that do know what they are doing. This is almost common practice and an art form for many of the incompetent leadership out there. A small business will not be in business too long with this leadership, but a person like this in a large corporation or enterprise can thrive and be promoted for years.

Mike,

Thanks for the thoughtful post. Interestingly, this is the first time I’ve heard the term counterfeit competence, and was curious where you would go with this.

I guess I’ve been fortunate over the past twenty years or so (as one who has some experience with the small business subject apparently in the cross hairs here, both on the company and client side) to have found entrepreneurs who readily acknolwedge their weaknesses and have the courage and insight to bring in appropriate support for long-term growth objectives. Of course, I’m dealing with established businesses and that may make a difference even if they are small. Still, my ‘in-the-trenches’ observation (which certainly doesn’t carry as much weight as the NYT) is those destined to make it start with a team mindset that covers their flaws early and often. Their solution may be with contractors vs. employees, but those that see the value of investing in their business early tend to make sure their money is well spent (and their egos are left at the door).

Well Nanette, the reason you may have not heard the term before is that it is possible that I coined the term some time ago for one of my articles or presentations on the subject. I also could have “borrowed” it from someone else. When you read and listen a lot, as well as write and speak often, it is difficult to keep track of the source throughout the years. However, it seems to fit so I continue to use it.

As I read your comment, I began thinking about what you said as compared to my own experience. Sometimes I have seen entrepreneurs fail because of this counterfeit competence but learn from their experience so they become successful the second time around. Of course, some people never learn and we all know where that leads.

Most recently, I notice this most when it comes to discussing social media with small business owners. In spite of overwhelming evidence (See recent HubSpot article) regarding the use of social media, they are so closed minded about the subject that they don’t even want to discuss it. In a few cases, they may be right. But in most cases, they are ever so wrong. What can you do?

Thanks for taking the time to comment.

Thanks for posting this article, I found it’s premise – that people who do things poorly are usually more confident in their ability than people who do things well – interesting.

Similar to the suggestion at the end for those recruiting, I have a friend who has his assistant cut names and graduation dates off resumes prior to his first reading of them. He then often starts with exchanging a couple emails and then a phone interview prior to meeting in person. He believes this helps him focus on competencies instead of image, name, age and other less important issues.

It also creates a challenge in deciphering true competence vs. staged confidence. We’ve all been trained that we only get that one chance to make a first impression so in an interview, I’d think most people would purposely spin everything positively and thus blur the lines for the recruiter. For instance, “yes, I can don that for you,” seems to be a better interview answer than, “you present an complex problem and while I’ve never faced one exactly like it, I think based on my past experience, I will be able to find a good solution.”

I recently finished reading, “The 21 Irrefutable Laws of Leadership” by John Maxwell. I felt this book did a good job of helping one assess their leadership skills and it also clearly articulated, as did your article, the need to look for people with different skill sets than you when hiring.

Thanks again and have a great week!
Donny

Well, I like the term, just didn’t understand it until I read your article.

What I find with small business and social media (and could be pooled into your detractor group here, depending on the language used and the issue) is many small business stiffen when it’s presented as a mandate and discussed as though it’s an entity of its own. Some have opened a Facebook account or thrown a static web page up, netted no success and concluded it’s a waste of time. Others are already using it in other ways, but don’t see it. Most try one or two aspects without seeing the relationship to their other activities (or making it work as such). I think when presented in a way that makes sense for their particular business aims, most are interested in learning.

Sadly, many form stereotypes of small business owners based on experiences with a select group – usually a minority that’s the most needy (goverment subsidized programs tend to target urban or rural start-ups) and/or the loudest (who tend to suffer from the ‘don’t know what they don’t know’ syndrome others have noted). With all net new jobs coming from small business for at least the past decade, they can’t all be as the norm is painted :-).

I agree with you Nanette. If all entrepreneurs and small businesses were like this, I would not be a SCORE volunteer or enjoy working with small business owners. Thanks goodness most realize we all are a little like this and that is what keeps us be more open minded, don’t you think?

Not sure what you mean, but, if your point is many small business owners (and people) can be a bit sceptical about change from what’s working or cautious about investing precious time and money prior to convincing it will be worthwhile, I agree.

Our smartest clients “know what they don’t know”. They have their egos well under control. They feel lucky when they find someone who has a skill they need, but know they don’t possess.