Many entrepreneurs long for the day when they can hand over much of the daily running of the business to a group of talented managers. At this stage you are managing managers. However, growing your operation to this level means you will have a new and challenging role. You will no longer need to direct the day-to-day activities of the business. This is the job of your managers.
The business will run without your involvement in everyday activities. However, that does not mean you won’t have a major impact on the long-term success of the company. In our experience, we find that your new role involves the following five value-added activities:
1. Determine the direction of the business.
You should take responsibility for setting goals for the company, developing a strategy to achieve those goals and ensuring that you have the appropriate systems in place to support goal achievement. Set revenue and profit targets, then determine how you will achieve them (expanding geographically, adding new products or services, increasing share of market in your current business, etc.).
As the leader, you own the vision, the mission and the strategy. Establish policies that will allow your company to achieve its goals.
2. Ensure the right people are in the right roles.
You are the head coach. You decide who plays where. Determine the skill sets needed to succeed in each role and put the right person in the right job. If necessary, redefine the roles.
Sometimes, there is no one in your company that has the skill set you need nor is there a person who is likely to be able to develop these skills in an acceptable timeframe. In such cases, you’ll have to go outside of the company to get the talent you need. These can be very tough decisions, but they are important.
3. Develop people.
If your company is to move to the next level, your people will have to grow and get better. It is your job to make sure they have the opportunity to do so. Identify the areas where your people need to grow and send them to classes, bring in outside trainers or create a self-study program. We have one client who pays his people a bonus for reading books he approves.
4. Communicate and motivate.
You have set the direction. Now make sure that your people understand the direction in which you want to take the business and that they understand their roles. This is not a one-time job. You’ll have to communicate the direction repeatedly through multiple channels.
Further, make sure that your systems are aligned with and support your direction. Your compensation system, measurement systems and performance-management system should incentivize people to do the things you want done.
5. Enable people and remove roadblocks.
Empower people. Delegate authority and hold people accountable for results. If you don’t, you are the roadblock to your company’s success. This shouldn’t be a problem since you admit that your people know the business and the industry better than you do. Make sure that your people have the tools to do the job correctly. Don’t send someone with a shovel to do a job that requires a backhoe.
Growing your business means that at some point you will be new to managing managers. Doing this well requires that you demonstrate a completely differently skill set. Focus on the five levers detailed above and you’ll be on the right path.