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  • David Pazgan

Why most small businesses stay small - and how to buck the trend

Updated: Apr 10

Spending the last decade building a franchise company, I had the pleasure of working with other franchisees at every stage of the business, from start up through the sale of their franchises. I found that most faced little trouble in launching their enterprises, scaling their enterprises, and turning a reasonable profit within a few years.

Interestingly, however, these savvy entrepreneurs often stagnated, reaching an acceptable revenue range but never achieving the next level. The owners took active roles in their businesses, handing either sales functions, operations, or both. They were the "glue" that held the businesses together. While that may be admirable, it is that hands-on approach that blurred their focus. Unable to see the forest for the trees, their concentration on tactics prevented them from drawing a strategic roadmap for growth, success, and prosperity. In many cases their roles as chief cook and bottle washer prohibited them from taking any meaningful time off. They owned the businesses they dreamed of, but not lifestyle.

Most of the time these owners could not articulate specific goals or quantifiable revenue, profit, or lifestyle goals. At the same time, owners demonstrated a need to control every aspect of their businesses. No wonder they felt busy all the time! They could not allow others to manage the most insignificant task or make the most minor decision. In some cases, this was the result of justified lack of confidence in the staff. Owners were afraid to rid themselves of underperformers, fearing the firing would leave the team shorthanded, affect worker morale, or cause the ex-employee economic hardship. Much more frequently, it was an unwillingness to cede control even to competent team members. Owners felt they were the only person dedicated and skilled enough to do the job right.

The solution comes in two parts:

1. Build a high-performance culture founded autonomy and accountability. Trust your business skills and instincts to create the right team. They won’t be perfect at first but resist the urge to step back in and take over. Mentor your employees instead. The more responsibilities you give them, the more confidence they will gain. The more you let them take the reins, the more adept they will become. Don’t believe me? Test if for yourself. Go on vacation for a few days. Don’t answer work email or phone calls. Your team will step up. They will justify the trust you have placed in them. And the ones who don’t? Their shortcomings will become obvious not only to you, but also your strong team members. The weak links will let everyone else down, and that will make it easy for you to get rid of them.

2. Build a rock star team. Step 1 won’t work without a diverse, intelligent, responsible crew. Teambuilding requires work and time; it is more art than science. As you build your business, you will work with people with various skillsets and personalities. It’s up to you to determine where their skills fit best. Remember that the answer for some may be “at another company.” Try to be objective in assessing employees’ performance, teachability, aptitude, attitude, and cultural fit. Give your people every chance to succeed. Build a culture in which each employee can thrive. Often, that means building paths for advancement where they can demonstrate to you their ability to take on additional duties. If you watch your key employees evolve into supervisors and managers through your tutelage, you will know they know how to do it right. After all, they will have learned from the master!

Follow these steps, and you should have no reservations about putting your experienced, dedicated workers in charge of departments and mission-critical assignments. Then you can finally relax, knowing your business is in good hands even when you’re traveling the world, relaxing with your family, or otherwise enjoying the fruits of your labors.


#clientsatisfaction #customerengagement

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