Entrepreneurs that have left the start-up phase behind should now be spending more time improving their businesses and shaping future strategies, rather than having a day-to-day role; the true test of a successful owner-managed firm is whether its founder is working for the business, or if it is working for them.
In the early-stages of its life a business is primarily defined by the person that created it. But if the business is to grow and become really successful then it must evolve beyond this phase and the entrepreneurs needs to get away from the day-to-day. This is a difficult task, but first must ask yourself how central your organisations and how much you have managed to develop:
Try the following questions and find out how many you answer yes to:
- Are you the main sales person or point of contact for key customers or suppliers?
- Do you negotiate all or most major contracts?
- Are you supporting the business with personal bank guarantees?
- Do you routinely answer day-to-day queries from staff?
- Are you working in excess of 40 hours a week?
- Do you spend fewer than five hours a week planning and discussing the future of the business?
- Do you feel you lack colleagues with whom you can discuss your hopes and fears openly and honestly?
If you have answered yes to more than a few of these then you are, in all probability, too involved at present for your business for it to really grow.
How to change things
Start to wean your customers and suppliers off their reliance on you and encourage them to engage more with the key players in your organisation. You need to identify individuals that have the potential to grow into more responsible roles. If you don’t then you're going to have to develop them or recruit someone to do the job. Ideally, you should look for people who can do the job better than you can – you might be surprised at how many candidates there are.
Finance
Many entrepreneurs have their business funding secured against personal assets such as houses. To get out of this situation you need to look at all the types of funding such as factoring, invoice discounting or equity investments. The number of private or angel investors and private equity firms available to invest in growing businesses has increased greatly in recent years and there are many forms of these. Equity is always the most expensive form of debt, but it can often bring greater stability to the business and control of the business does not necessarily have to be sacrificed if you find the right partner.
Management style
As a first step, you must resist the temptation to solve the many problems brought to you. Repeat this response often enough, and people will soon get the message that you aren’t the answer to all problems. Start to clarify your staff roles with written job descriptions, so that everyone has a sharper understanding of what they are there to do. Delegate a little at a time, preferably on non-critical areas at first and then add more responsibility as the confidence of your staff increases.
As a result, you should spend less time in the office getting in other people's hair. By divorcing yourself from the daily routine you will have more time and space in which to think. Many successful entrepreneurs get their best ideas out of the office. Also, people who get out more invariably discover two things: the office can work with out their permanent physical presence, and talented people embrace responsibility and positively enjoy it.
© Crimson Business Ltd. 2009