Most people who start their own business are looking for freedom and dream of making their company run without them. Somewhere along the line, many of those same people start believing that they need to make all of the decisions and do almost all of the work, just to keep the business thriving and healthy. Eventually it consumes all of their time and effort, and the concept of freedom becomes a pipe dream. If you find yourself in this position, you can get back on course and make your business much more valuable and less stressful to run. If you are gradually working towards your exit from the business this is even more important. If the business can’t run without you, it will not be worth as much to potential buyers.
Track Where Your Time is Spent
Before you can start separating yourself from the daily grind, you need to figure out where all your time is being spent. As a business owner, you must balance doing work, making decisions, managing people and growing the company. Once you understand how much of each of these things you’re doing, you’ll get a clearer picture of what needs to be delegated.
As a business owner, you have a natural tendency to want to be in control. After all, it’s your company; who else will care more than you do? You need to ask yourself if the best use of your time is really micromanaging every aspect of the business. The right answer is “no”, not if you’re really looking for more freedom, and hoping to eventually sell your business at a premium.
Document Business Processes
Part of delegating and empowering your team is to get everything out of your head and into an operations manual. Record everything in a comprehensive guide that could make it easy for anyone to run the business. It will help your staff to have a set of rules and guidelines to follow when you’re not around without having to run everything through you. It will also help you to quickly train new employees.
Having a manual adds a lot of value to your business, as it helps prospective buyers to see how they can quickly acclimate to running the business and helps to prove that it doesn’t entirely depend on you. If you want to put your manual to the test and make sure it doesn’t have any holes, take a vacation or step away for a few days and leave your staff in charge. If something goes wrong that isn’t documented, you’ll know that it needs to be added to the manual.
Lighten the Workload
To start the delegation process, make a list of every product or service your company sells. Rank them in order from easiest to delegate to employees to hardest. Then start working your way down the list, handing responsibilities over to your staff one by one, beginning with the easiest. In the process, consider whether tasks that are difficult to delegate are really profitable enough to keep up. If you can’t hand off a particular service, consider handing it off. After all, it really isn’t adding much value to your business if it can’t be done without you. Repeat this process regularly and you’ll have a much more streamlined selection of products and services.
Empower Your Team
In highly efficient businesses, everyone knows that the core function of the business is the priority. Encourage your employees to start making decisions on their own, with the core function and principals of the company in mind. When they come to you with a problem or need to make a decision, ask them what they would do. Encourage them to walk in your shoes and soon they will be able to solve their own problems. This will also help them feel like they are doing fulfilling work.
You also need to make sure that your highly skilled staff members and managers are not spending too much time on unskilled work. Utilize their skills appropriately and make sure you are giving them work that is worth their while. If you have lesser skilled employees that you can delegate routine work to, you should do it. Always make sure you are matching your employees’ strengths to the correct job role. Help them to grow within their role so they can skill up and assume more responsibilities as the opportunity comes about. This will help optimize your business operations and make it easier for you to step away.
Give Employees Stake in Your Success
If you want to transform your employees into leaders who can run your company, give them a stake in the company’s success. Be more transparent about the business’s financial goals and give your staff a clear picture of how their actions contribute to that success. Incentivize the staff, so what’s good for the business is also good for them. Give leaders ownership over their own area of the company and step back, allowing them to take charge and operate on their own. In the beginning, you can act as a mentor, and intervene when necessary, then gradually step back and give them more control.
Switch to a Recurring Revenue Model
If you are your company’s best salesperson, you need to take a step back. The easiest way for your business to thrive when you’re not around is to switch to a recurring revenue model. Consider creating service contracts with your existing customers, offering to take care of their ongoing needs on a regular, interval basis. This will take the pressure off of you having to procure new business every month, and will make the company more valuable in the long run.
Keep the Bigger Picture in Mind
Maybe the biggest obstacle you will need to overcome in the process of creating distance between you and your business is yourself. Many entrepreneurs can’t get over their fears about how the business will run without them. Some are driven by their ego, while others are just stuck. Committing to removing yourself from the daily grind of running your business is the best thing you can do for it and yourself. The business will subsequently be worth a lot more if you decide to sell it. Additionally, you will have more free time to discover interests outside of your company, which will help you to adapt easier when you eventually sell, or exit by other means.
Are you not quite ready to sell, but want to work towards you eventual exit by spending less time running your business? Corporate Investment Business Brokers (CIBB) has been helping business owners in Southwest Florida plan their exits since 1986. We can help you figure out how much your business is worth and guide you through the process of increasing its value, while slowly reducing your daily involvement. Our consultation is completely free of cost and obligation. Contact us to discover how you can get your business on the path to running itself.
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