One of the joys of the work I do is to work directly with the owners of small-medium businesses. Their approaches are very different depending on their funding model.
For example, where there is venture capital for a start-up, there is usually a requirement for a clear and evolving management structure. Sometimes a founder will take on the role of CEO, and sometimes this will be someone brought in from outside the organisation.
Business Owners are Stressed
In contrast, self-funded businesses typically retain the founder at the helm completely dedicated to and essential to the success of the company.
This can be quite effective for the lifetime of the company, or should I say the lifetime of the owner! However, it can mean an overload of work, high levels of stress, and inability to take time off — all potentially damaging to the health of the individual and the company.
If the owner becomes sick or takes an extended holiday things can grind to a halt in a smaller business. It is pleasing to say that many of my small business clients have brought in general managers to take on the day-to-day running of the business and allow the founder to focus primarily on one aspect — sometimes technical specialisation, but commonly business development.
Succession Planning is important for companies of any size
In the business risk workshops I run, we often discuss succession planning. In large organisations there is a pool of people to develop, but in small organisations this is more challenging, particularly if the owner doesn’t want to let go!
Working with business owners, I sometimes start by asking what exit strategy they have. To me there seems to be 3 options if business owners don’t want to die at their desk (and some do!):
- Sell the business
- Close the business
- Hand over the business (to family and/or staff)
Whichever option is chosen there is preparation to be done.
The Vision work I do with business owners and executives helps them formulate a picture in their minds of their future business, and then work through what it would take to reach it.
Do you have a Vision for your organisation that doesn’t include you?