You Don’t have to do it ALL! Scaling your Business
You Don’t Have to do it all! Start Scaling Your Business
Listen, if you’re like the typical BOE – Business Owner/Entrepreneur – you’ve probably done almost every job there is at your company. Most BOEs do a bit of everything in the beginning. They do it in part because they must, but also to prove that they can (and maybe to save a buck or two in the bargain). I know many BOEs who are perfectly happy to empty trash, change lightbulbs, write checks, and even paint the break room when needed.That hands-on, can-do attitude can be fun (and necessary) for a while, but it can also become unprofitable. That’s because the real value of a BOE lies in maintaining company vision, ensuring quality, and developing strategies to help the company grow profitably. And while it may sound elitist to some, there comes a time when a business owner has to stop restocking their own toilet paper. Any BOE who wants to scale their business must spend time doing the things that add the most value to the company and delegate the rest.
What’s the Difference Between Scaling vs. Growing?
Scaling really is much different than growing. When you grow a business, you’re doing more to get more. That means you work harder or sell more or do more. Let’s look at how this works with restaurants. If you own one restaurant and want to open a second, you may find that the second restaurant costs just as much as the first, that you have to hire just as many people, and that you make about the same profit. As the owner, you may find you have to spend just as much time managing the second restaurant. This is a classic example of growing. Scaling happens when processes are in place that support the business with some efficiencies of scale. That means you’re not necessarily asking people to sell more, do more, or be more. Instead, you’ve put processes in place that automate certain aspects of the business so that people work more efficiently, and your personnel costs don’t double when your business doubles. So, in the restaurant example, owners can scale by using a good payroll service, great recruiters, savvy buyers, smart managers, and a head chef to manage multiple locations. You can use this same team to help you open two or three or even four hundred restaurants. The additional restaurants rely on the systems you have in place to run smoother and be more profitable. And as owner and CEO, you won’t work 400 times harder to run four hundred restaurants. Growth happens because you do more. Scaling happens because you’ve created processes that expand your ability to do more. Both growing and scaling can multiply a company’s size, but scaling helps you do it in ways that fortify margins and expand the scope and possibility of your business without running you, the owner, into the ground.
So, how do You Know When to Delegate?
When you’re in the thick of running a business, the idea of delegation seems IMPOSSIBLE. How do you utilize a team? When should you hand off a task, a job, or a division of the company? I tell my clients that, as business owners, they should think of themselves as the highest-paid employee at their company. Maybe they make $200, $500, or even $5000 an hour. Once we have an hourly rate in mind, we’re able to evaluate the task’s worth by comparing it to their hourly rate. Would you pay someone $200 an hour to empty the trash? Would you pay an accountant $5000 an hour? Would you hire a recruiting firm that charged $500 an hour? It’s pretty easy to see that many activities can and should be handled by someone else and that BOEs should focus on the big picture.Think about how you spend your day and delegate the jobs and tasks that are, literally, not worth your time. Instead, spend time doing things that help you become more profitable and more successful.
The Ugly Truth: Delegation Requires Training
In Take the Stairs, author Rory Vaden talks about a formula of significance. He wrote that training people to handle recurring tasks takes time upfront (painful to do, right?), but it will save time in the long run.So, for example, if you’re going to meet with a designer to redo your office just once, it may be more trouble than it’s worth to train someone to work with that designer. However, if you plan to redecorate the lobby, the office areas, and other locations as well, or if you plan to make regular décor updates, it’s smart to train somebody else to handle these design tasks. To save time and be able to scale, you must identify the repetitive activities in your life and train someone to do them for you. Yes, you will need to spend more time training than doing, at least during the first few lessons, and most people dread teaching someone to do tasks that you can complete without much thought. But when you tabulate the time you save over a week, a month, or a year, you will see the value of delegating. For example, getting your mail and sorting through it might take five minutes a day. Deciding what to do with important mail can take another ten minutes. Fifteen minutes a day doesn’t seem like much. And training someone to take care of your mail, and answering their questions over the coming weeks could take two or three hours of training and follow up. However, it would only take about two weeks for the training time to pay for itself. And over the course of a year, you’d save forty hours or more. You’d get an entire week of time back.
Stop Doing. Start Delegating.
A successful BOE must focus on finding ways to build and scale their company. One way to do that is to look for ways to build systems, automate, create processes, and build an organization that runs well, whether you are in the building or not. Look for ways to scale and expand without investing an equal amount of your time and effort. Remember, as a BOE, your job is to orchestrate, refine, and build. Once you free yourself from the endless small tasks that fill your day, you’ll be able to dedicate yourself to strategic activities and long-term success. And once you do that, the sky is the limit.