Everybody makes mistakes. Anyone in business for any length of time knows this is true. What counts is what one does with those mistakes , how well we learn from them and how well we learn from the mistakes of others so that we can hopefully avoid making these mistakes ourselves. To increase your awareness, here are seven common mistakes executives and business owners make along with a tip for avoiding or preventing their repetition.

1 Being unrealistic

Entrepreneurs by nature are optimistic. It gives them their edge. However, in their zeal, it’s easy to put blinders on and create their own reality. It’s surprising to see some of the bizarre ideas intelligent, successful businesspeople conceive and convince themselves will work! To avoid falling into this trap, it’s important to seek the counsel of your peers and others whom you respect when making important decisions about new products, markets and ventures. Remember: If your idea doesn’t get broad or significant acceptance, that may be a strong indication that the idea doesn’t make sense or isn’t marketplace-ready.

2 Not investing in people

Businesses are about people finding, developing, growing and, perhaps most importantly, keeping them. In today’s competitive business environment, not hiring the most competent, skilled and intelligent people you can find, and then creating an environment where they can grow and thrive, is a major limitation to business success. And when businesses lose their best people, they lose a very real business asset. Make sure you have a solid incentive, retention and employee satisfaction program in place.

3 Failing to stay current with technology

The ongoing changes in technology today are equivalent to the changes that occurred a century ago when people started leaving farms for the cities. Today’s executives must recognize the critical role of technology in their businesses and commit themselves to staying current with, not ahead of, technology. Jumping the gun can be expensive. Companies can end up with software and hardware that is quickly outdated. As in horse racing, focus on picking the “finishers.” On the other hand, executives who brag they “hate” computers, don’t use them, and can’t see the need for technology upgrades are really short sighted. They jeopardize their company’s competitive advantage and ability to serve clients and vendors effectively and efficiently. Take the time and make the effort to understand and use the information management tools available to businesses today. It’s the key to building and sustaining a business today.

4 Trying to go it alone

Just as entrepreneurs are optimistic by nature, many also tend to be “lone rangers.” In the long run, this almost never pays off. Successful owners and executives know the importance of finding skilled, competent directors and managers, and then giving them the freedom and flexibility to do what they do best. Build a strong management team that includes professionals with varied backgrounds and experience. Don’t just hire and consult with people who are just like you. You’ll end up with a bunch of “yes men.” Successful leaders don’t need 100 percent agreement; they want and rely upon direct, honest opinions and ideas.

5 Not realizing the point at which professional management is necessary

It’s the old entrepreneur vs. manager dilemma: Entrepreneurs have great ideas and excel at starting and building things. However, there usually comes a point in a business’ life where the entrepreneur needs a professional manager to bring the business stability and grow it to the next level. Too many promising businesses stagnate and ultimately fail because the founder doesn’t hire a manager to take the venture from a promising startup to a professionally run organization. Recognize that your area of expertise may be technical or visionary in nature. When the time is right, hire a manager with strong organizational, personnel and leadership skills.

6 Not listening to your customers

A textile manufacturing company executive said he didn’t understand why everyone wanted cotton: “After all, cotton doesn’t hold its shape very long.” It doesn’t matter what executives think their customers want. What matters is what they do want. Find out what your customers want; listen to them. That can be easy if you take the time to think back to situations where people have tried to sell you something you didn’t want, didn’t need and couldn’t afford.

Disregard for customer input is surprisingly common at the highest levels of many companies. The leaders of many Internet companies are extremely arrogant with regard to what they think their customers want. But there are exceptions: The Harvard Business Review, for example, used to have a terrible Web site it was very hard to order from. But someone there listened to what customers had to say, revamped the site, and now it’s terrific.

7 Not taking a long-term view

The streets are littered with businesses that failed because they were too heavily focused on the short term on fads and trends that were hot for awhile but then died, taking the business down with them.

Just look at the recent shakeout in Internet stocks: Companies that sprang up out of no where based on nothing more than a trendy idea soared at first, but then came crashing down when investors finally decided it would be nice if there were actually a profitable business behind the idea. The Internet companies that will survive will be those that take a long-term view of their customers, industry and marketplace.

Heed the Warnings

Just as you watch other executives and business people you admire to learn the right things to do, you can benefit greatly by heeding the warnings and avoiding these mistakes that have cost others similar to yourself dearly. Remember the old adage, “Fool me once, shame on you fool me twice ”

Jerry Savin, CPA, CMC, is CEO of SITKA Systems, Inc., a Santa Monica-based management consulting firm. Mr. Savin specializes in information technology assessment and business information systems. He also teaches courses on business information systems and management consulting for universities and professional associations, including UCLA, the California Society of CPA’s (CSCPA) and the Institute of Management Consultants (IMC). For more information, call (310) 230-1470 extension 8947 or visit the company Web site at www.sitkasytems.com.