The Problem of the "L" Shaped Curve.
Our motivation for starting the ManageHub initiative is our concern that significant numbers of startups and small businesses are failing for the wrong reasons. Certainly, there are many "good" reasons businesses close their doors. These "good" reasons may include not finding market traction, a sudden change in regulations, or the desire of the entrepreneur to try something new. There is also the inherent risk of being in business. However, when looking at the data, troubling negative trends suggest something more at play.
To take a closer look, we worked with the U.S. Baldrige Performance Excellence Program (www.nist.gov/baldrige) to research small businesses. We discovered a new and significant contributing factor impacting the long term survivability of businesses that we call the "Management Gap". The "gap" represents an overall lack of access to the same kinds of management methods used by the largest organizations to grow, innovate, and succeed in the long-term. Filling the "gap" is the reason we created the ManageHub Software and Accelerator program. Our mission is to fill the "Management Gap" and help more companies avoid the problems of the L Shaped Curve.
In addition to the problem of the "L" shaped curve, a review of recent economic data is further cause for concern. Small businesses are often referred to as the "Backbone" of our economy. They are an important source of economic flexibility, innovation, and resilience. They also provide an important safety-net during troubled economic times. However, a review of recent SBA data suggests the overall health of our small business ecosystem is in decline. For example, the graphs above show that small business contributions to overall employment and GDP are falling. And, the chart below shows that for the first time in the history of our economy that the number of business failures exceed the number of startups. This means there is a net decline in the number of businesses fueling our economy.
ManageHub believes that by filling the "Management Gap" we can help more businesses survive and help reverse the current negative trends.