How to Bankrupt a Business: Ask the Wrong Question and Get The Right Answer

Did you hear the one about the Russian entrepreneur who went bankrupt after getting the right answer to the wrong question?It feels like the setup of a joke, doesn’t it?You could be forgiven if you expect a punchline where we all burst out in laughter.But far from being funny, this story illustrates the power of asking the wrong question and getting the right answer.Because the most serious mistakes in business are not the result of wrong answers.Companies recover from wrong answers every day.The greater sin is asking the wrong questions—and getting the right answers.Getting the right answers to the wrong questions is a guarantee it’ll take longer to discover where things went wrong.And time is money.Case in point: The Russian entrepreneur who opened a nightclub in the Brighton Beach area of Brooklyn, New York.He successfully tapped into a niche missed by other nightclubs; people interested in Russian culture.Things skidded off the rails when the entrepreneur hired a master chef away from a wealthy Russian family, whom he had served for 25 years.With the promise of a substantial equity position in the club, this chef moved to New York and took the job.And things were great.Until they weren’t.A short time later, the nightclub was bankrupt. Why?Because the entrepreneur asked this question…“How good is the chef?”And he got the right answer.Everyone agrees he’s a superb cook!In hindsight, the entrepreneur should have asked…“For the last 25 years, you’ve been preparing meals for a private family with six to 10 place settings. What experience do you have in preparing 150-200 meals every night?”By the time the business partners discovered the chef was ill-equipped for the responsibilities of managing the nightclub’s kitchen...... their reputation was beyond repair, and customers vanished.

Chairman of General Motors Stuns the Executive Committee with One Question

In Adventures of a Bystander, Peter F. Drucker shares how the chairman of General Motors, Alfred D. Sloan, had a knack for asking the right questions.For example, hiring decisions at GM could turn into heated debates, and looking to hire Mr. Smith for president of an operating division was no exception. Mr. Smith had a reputation for handling crises’ superbly, solving problems beautifully, and quenching fires routinely… so the GM executive committee seemed in agreement.But before they made the final decision, Sloan spoke up.“A very impressive record Mr. Smith has, but please do explain to me how he gets into all these crises he then so brilliantly surmounts?”The GM committee had been focusing on how Mr. Smith solved one problem after another with great skill.Sloan focused on why Mr. Smith had so many problems to solve.Sloan recognized Mr. Smith was dwindling his energy on perpetual problem solving and very little on identifying and capitalizing on new opportunities.Instead of being entrepreneurial, Mr. Smith was a superb arsonist.Nothing more was ever heard of Mr. Smith, all because of one right question.

Beware Asking the Wrong Questions You Might Get the Right Answers

Asking the wrong question is more common in the digital marketing space than in any industry in history.For example, “Should I switch from Facebook to Google ads? When should I switch? Are my ads considered viewable?”If you know anyone asking similar questions while seeking a new agency partner, they’re asking the wrong questions.And the threat is they may get the right answers.So, if you could use a little help in asking the right questions––and getting the right answers...