Some owners focus on growing their profits, while others are obsessed with sales goals. You may also find yourself concentrating on the deeper impact of your business and leadership - on your sphere, your community, and your employees. But would that impact continue in your absence? Have you prioritized setting up your business so that it can thrive and grow - without you?
On a practical level, a business that’s not dependent on its owner is the ultimate asset to own. It allows you complete control over your time, so that you can choose the projects you get involved in and the vacations you take. And when it comes to getting out, a business independent of its owner is worth a lot more than an owner-dependent company.
Here are five ways to set up your business so that it can succeed without you.
1. Give Your Employees a Stake in the Outcome
Jack Stack, author of The Great Game of Business and A Stake in the Outcome, has a straightforward method for creating an ownership culture inside your company: be transparent about your financial results, and allow employees to participate in your financial success. This results in employees who act like owners when you’re not around.
2. Get Them to Walk in Your Shoes
If you’re not quite comfortable opening the books to your employees, consider this simple management technique. Respond to every question your staff brings you with the same answer: “If you owned the company, what would you do?”
Pushing your employees to consider questions and decisions from your point of view will move them into the problem-solving mindset of an owner. Pretty soon, they’ll be bringing you solutions instead of challenges.
3. Vet Your Offerings
Identify the products and services that require your personal involvement in making, delivering, or selling them. Score all of these products on a scale of 0 to 10 – offerings that could be passed to employees with minimal handholding would receive a 10, while products that require more of your personal attention and/or whose management is less transferrable would receive proportionally lower scores. Commit to discontinuing the lowest scoring product or service on your list. Repeat this exercise every quarter.
4. Create Automatic Customers
Are you the company’s best salesperson? If so, you’ll need to fire yourself as your company’s rainmaker in order to get it to run without you.
One way to do this is to create a recurring revenue business model where customers buy from you automatically. Consider creating a service contract with your customers that offers to fulfill one of their ongoing needs on a regular basis.
5. Write an Instruction Manual for Your Business
Finally, make sure your company comes with instructions included. Write an employee manual, or what MBA-types called Standard Operating Procedures (SOPs). These are a set of rules employees can follow for repetitive tasks in your company. This will ensure employees have a rulebook they can follow when you’re not around, and, when an employee leaves, you can quickly swap them out with a replacement to take on duties of the job.
“You-proofing” your business has enormous benefits. Your company will be free to scale up because it is no longer dependent on you, its bottleneck, and it will be worth a lot more to a buyer whenever you’re ready to sell. Most importantly, it will allow you to create a valuable company, empower and enrich the lives of your employees, and make an impact in your community and sphere - while still having a personal life!
Interested in continuing this conversation around strengthening your business, enriching your storyline, and increasing your impact? Join our community of purposeful business owners and life-long learners - join an Acumen team in 2023.
January 26, 2023