Business owners who are overly involved in day-to-day operations risk becoming the bottleneck, hindering employee contributions, business growth and profitability while sacrificing their quality of life.
Primary Implication
As a business hires skilled employees to support the growth of the business, the owner who has been the glue holding everything together has to start letting things go or face the consequences of owning a business where everyone associated with it is dependent on the owner.
You know you have an Owner Dependence problem, when work stops while employees wait for the owner to resolve problems. When this happens, the owner is likely the largest constraint or bottleneck in the business. Owners like this never make as much money nor have the time to enjoy what money they make because they have allowed their business to become 100% reliant on them.
Overview
If you ever hear an owner say, “I never have time to myself because everyone keeps coming to me for direction,” then you have a business where the owner has put themselves in a shrinking box. An owner who chooses to be involved in everything or makes their employees run everything by them will soon find the box shrinking around them as the business grows and the demands on the owner increase.
When it’s the owner with a few employees in the start-up phase, it’s natural for everything to go through the owner since they are likely the ones with the most technical skill for the work getting done. As the business grows in size in terms of people, sales, and expenses, the owner who fails to pull themselves out of getting the work done tasks because they don’t have confidence in their people to do it right becomes the business’s bottleneck.
Owners who are the bottleneck in their business cost themselves hard money as the people they pay to do the work stop working, waiting for the owner to decide or come and see what’s at issue. This always results in orders being late, quality issues, and lower profit margins.
When the owner is the business’s problematic issue, they need to stop and rethink whether they want to do the work or manage the business? They can’t do both. It’s not fair to their families, their customers, their employees, or themselves. They decide to either let go of what they are paying others to do or let go of the people who are blocked from doing what they are paid to do because the owner is always holding everything up.
The quality of life associated with owning a business is proportionate to the number of employees in that business recognizing and attacking the constraints of a business. Having employees working to eliminate business constraints is the key to quickly unlocking higher profits, superior cash flow, and more discretionary time for the owner.