Top 7 Reasons That Causes Entrepreneurs to Fail as Managers

The entrepreneurial skill set is vastly different from the managerial skill set, and it can be challenging to make a transition. Entrepreneurs are used to running the show and making things happen, but they must delegate tasks and empower others to do their jobs in a managerial position.

Why Entrepreneurs Fail as Managers

1) Entrepreneurs Don’t Know How to Manage People

The first reason that causes entrepreneurs to fail as managers is that they simply don’t know how to manage people effectively.

Entrepreneurs are accustomed to working alone or with a small team of partners and associates. But as managers, the business requires them to be able to work with many different types of personalities. It can take years for an entrepreneur to learn how to manage others effectively, and some never do.

2) They Are Used to Making All the Decisions

It is important to delegate tasks and make decisions through consensus in a managerial position.

Entrepreneurs, having been in complete control of their companies for many years, are accustomed to making the final decision on everything. However, when they become managers, they must open themselves up to the opinions and ideas of others.

3) They Have a Hard Time Accepting No as an Answer

When an entrepreneur is in charge, they do not have to answer to anyone.

Naturally, entrepreneurs that become managers realize that they now have a boss and therefore must answer to them and report back on their progress regularly.

Some entrepreneurs struggle with accepting that they no longer call all of the shots and may overstep boundaries as a result.

4) They Get Distracted Easily

Managers have a lot of things to accomplish and not a lot of time to do it. In addition to their regular workload, they have numerous other responsibilities that keep them occupied daily. This leaves little time for distractions such as making sales calls, conducting market research, etc.

Entrepreneurs, who are used to concentrating on the task at hand without distraction, struggle with this newfound responsibility and find themselves easily sidetracked when they should be focusing on other things.

5) They Don’t Know How to Delegate Tasks Effectively

Employees are not robots, and managers need to know how to delegate responsibilities appropriately.

It can be challenging for entrepreneurs to let go of certain items or tasks that they feel are crucial to their daily operations. However, when they finally learn to trust others with these responsibilities, they may still hover over their employees’ shoulders, telling them what to do and how to do it.

6) They Micromanage

Micromanaging is a quick way for entrepreneurs to turn off their employees and make them feel like they are not valued.

Entrepreneurs like to be involved in everything, and naturally, they don’t want to let go of any duties when they become managers. This includes constantly asking how things are progressing or why certain things haven’t been done yet.

Micromanaging creates tension in the workplace and makes it difficult for employees to feel like they can do their jobs.

7) They Have a Hard Time Giving Negative Feedback

When an entrepreneur is in charge, they can do things their way without answering anyone; however, as managers, employees expect feedback when they make a mistake or fail at doing something correctly.

For an entrepreneur that has never been exposed to negative feedback, it can be a difficult concept to grasp. They are not used to explaining what they want to be done differently or why things aren’t working out and may let mistakes slide until the damage is done.

So these are the top 7 reasons that cause entrepreneurs to fail as managers.

The Effects of Bad Management on Employees

Poor management can have a ripple effect on employees, and it is not always easy for them to leave a job where they do not feel appreciated.

When an entrepreneur cannot make a successful transition into a managerial role, it can lead to frustration among employees, low morale, and high turnover rates.

In the worst-case scenario, employees may feel forced to quit their jobs to seek a work environment that is more supportive and positive.

So if you are an entrepreneur making the switch into management, be sure to keep these things in mind. It is not always easy, but you can make the transition successfully and lead your team to success with a bit of effort.

Can a Manager Be an Entrepreneur?

There is a lot of discussion about whether or not a manager can also be an entrepreneur.

On the one hand, some feel that the skill set required for managing a business is different from the skillset required for running a business.

On the other hand, some feel that being an entrepreneur automatically makes someone a good manager.

The truth is, there are successful examples of both scenarios. However, it is more difficult for an entrepreneur to become a successful manager than for a manager to become an entrepreneur.

So what do you think? Can a manager be an entrepreneur? Or is the skillset required for the two too different? Let us know in the comments below.


In conclusion, while some entrepreneurs can make the successful transition into managerial roles, others fail miserably.

There are several reasons for this, including but not limited to: difficulty concentrating and staying on task, lack of effective delegation skills, micromanaging, difficulty giving negative feedback and having a hard time accepting change.


What Skillsets Are Different in Management and Entrepreneurship?

There are many differences in skillsets between business ownership and management. For example, a business owner may need leadership skills, whereas a manager does not need them – but they still have to accept responsibility for their decisions. Similarly, business owners often pick the technology their business uses while managers don’t do the research themselves.

How Do Entrepreneurs Find Out They’re Failing as a Manager?

One way entrepreneurs can find out they’re failing as a manager is by taking the time to ask themselves two crucial questions:

– Am I making decisions that affect my business even though I’ve delegated?

– Am I still feeling like I want to do it all myself and not adequately train others?

If entrepreneurs answer “yes” to both these questions, they may be in danger of failing as a manager.

Why Is It Difficult for an Entrepreneur to Become a Successful Manager?

One difficulty entrepreneurs face when transitioning into management roles is that managers are expected to be business strategists or coaches who empower their employees.

On the other hand, an entrepreneur is expected to be someone who builds something for others but realizes nothing about teaching anyone else how to do it. As a result, entrepreneurs are often rigid thinkers who are used to doing things their way.

You may also like… Is Small Business Management Different From Entrepreneurship?

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