The 4 Levels of Competence — With 2 That Entrepreneurs Must Avoid

3 min read · 7 years ago


Wow. Once again I watched an entrepreneur step off a cliff, straight into the abyss of certain business doom.

And the sad part? He didn’t even know it.

In my role as founder and CEO of Mighty Wise, a company providing resources for entrepreneurs, I interact every day with dozens of business owners. Many realize their shortcomings and work hard to overcome them. Others experience the dire fate of deer caught in the headlights.  

Let me explain. People basically have four levels of competence, a theory developed at Gordon Training International by its employee Noel Burch in the 1970s. For entrepreneurs, two of these levels rock, and two don’t.

Where do you fall across this spectrum described below?

Related: 5 Potentially Dangerous Decisions to Avoid When Starting a Business

1. Unconsciously incompetent.

Some people maintain a “you don’t know what you don’t know” state of existence. It’s otherwise known as living in the land of doom, living in an illusion. Yuck.

It’s very dangerous for entrepreneurs to be unconsciously incompetent. Anyone seeking to take a business to the next level simply cannot risk being blindsided by the unknown.

Stacked on the roadside of business death are the remnants left behind by unconsciously incompetent entrepreneurs. And, yes, they imagined they were on top of the world. And they probably were at one time.

But things change. Business owners operate in a dynamic marketplace. Just pick up Clayton Christensen’s classic, The Innovators Dilemma, and you’ll read about company owners who were blindsided.

The next step: Avoid this paradigm by surrounding yourself with trustworthy and wise mentors, coaches and advisors. Everyone has blind spots. So it’s imperative for you to have people around to point them out. If you have the right advisory network, you can circumvent the realm of unconsciously incompetent. 

2. Consciously incompetent.

It’s quite sad to see an entrepreneur who struggles, recognizes why he or she is struggling but fails to do anything about it. This situation is perhaps the most frustrating and perplexing for outsiders to view.

For example, I’ve mentored many entrepreneurs and helped them to realize one reason for their massive struggles can be found by looking in the mirror. Yes, they have a core dysfunction that needs fixing – be it lack of leadership, inability to communicate or shortcomings with time management.

And when they’re made aware of the weak link and given the resources to fix it? Nothing happens. And thus, they remain stuck in the confines of the consciously incompetent.

Next step: When someone points out a shortcoming or an area needing fixing (whether it’s you or your business), do something about it. Take action. Clean it up and make it better. Is it easy to do? No, sometimes it’s not. Trust me. You do not want to dwell in the state of being consciously incompetent for long. 

Related: 7 Traits Elite Entrepreneurs Display at Work and in Their Zest for Living

3. Consciously competent.

When some individuals become aware of a personal weakness, they decide to do something about it. And then they start improving so it’s no longer a weakness.

Welcome to the state of the consciously competent, where you’ll find most moderately successful entrepreneurs and businesses residing. They know their stuff, and if they focus well enough, they can do a pretty good job in execution of their goals.

This is home for many entrepreneurs and a good and comfortable place to exist.

Next step: Aim to remain, at a minimum, in this state. If you have a good advisory network, you will consistently receive feedback about weaknesses needing to be addressed. So you’ll naturally move as fast as possible into this stage for most things you do. But to reach the highest points of success? Aspire to rise to level #4. 

4. Unconsciously competent.

For some fortunate people they are so good at what they do, they can do it in their sleep. This is the Holy Grail incompetency. Call it the Michael Jordan stage, being like a star athlete in his prime, gliding through the air, flying by an opponent with a flawless dunk in the zone.

Most entrepreneurs I’ve seen prevail combine their natural-born talents with the Malcolm Gladwell benchmark of 10,000 hours of practice. If this is you, you’re operating at an extremely high level and have the accolades to prove it. Think of Apple’s Steve Jobs in his prime. Welcome to the best of the best.

But not only does this apply to entrepreneurs as people, it also carries through to their businesses: After they nail the secret sauce, they repeating their success over and over, becoming unconsciously competent. For example, after many years of struggle and turmoil, Apple’s leaders are currently operating at this level.

Next step: Just keep doing what you’re doing if you’re in this state.

Oh, wait a minute. Scratch that. It’s far better to aim higher, to innovate without mercy. Act bolder. Never rest on your laurels. As entrepreneur Glen Tullman once said, “Every day the world turns upside down on someone who thought they were sitting on top of it.“