28 Aug 2015

How to jump the 750k black hole (part 2)

Posted By

Darryl Bates-Brownsword is a partner of The Shirlaws Group and Managing Director of the Shirlaws Coaching business in the UK.

Darryl Bates BrownswordIn part one http://bit.ly/1CVLWsI I explained the need for a functional infrastructure if your business is going to jump the 750k black hole. Here I’m discussing the difficult art of delegation and how to maintain control of your growing business.


Business owners know intuitively that they need a way to delegate. But how to do it well? We commonly see two approaches: hands off and hands on – neither of which is ideal.

One owner might say they need a marketing manager, for example. They find someone with good experience and typically pay them more than any other employee. ‘You’re an experienced marketing manager – off you go!’ they say to the new employee.

The owner drops everything on this new person and then disappears. Yet in saying, ‘It’s all yours’, the owner still has a set of expectations even though they haven’t voiced them.

Training, giving direction and setting expectations

Three months down the track the owner will ask the marketing manager, ‘Where are my results…and where are all my new clients?’ The marketing manager replies, ‘Well, marketing takes time and I’ve got to build a plan.’ But the owner is disappointed. ‘I thought you were experienced and I need those results now. Don’t you understand?’

This approach isn’t effective delegation and it isn’t very good communication either.

If the owner has been delivering a function themselves, they know exactly how they want it doing. They could explain what they’ve done previously and perhaps suggest working together for a while. This alternative approach would help induct and train a new employee while also setting clear expectations.

At the other extreme lies the micro-managing owner who doesn’t provide enough freedom, responsibility or accountability. As a result, the new employee is likely to move on quickly and all the owner’s recruitment spend is wasted.

Gaining control

For businesses to sustain growth, they must develop effective feedback mechanisms – ways of monitoring and reporting – to complement their new functional structure. Ask yourself, ‘When I’ve given someone the responsibility for a task, how do I know they’re doing it the way I want?

Monitoring and reporting works for every level of functionality. But it’s vital to start thinking about these aspects of bigger businesses early, before introducing your own management structure.

These feedback mechanisms return control to the owner, which is exactly how they felt when they had a direct relationship with their small team of employees.

Adding leadership capabilities to your professional ones

Most business owners started out by being the best at what they do. If it’s an accounting practice they’re an excellent accountant or if it’s a legal practice then they’re an excellent lawyer. But everyone must go beyond their professional capabilities if they’re to grow the business. In particular, they need to be thinking six to 12 months ahead of the business. And to create some head room they must adopt a functional structure.

This change towards a functional structure and feedback systems is the first step in moving beyond your own technical specialism. While an owner will always be intricately involved in their business, their role needs to change with growth.

This is an important time because the management structure change is visible right across the business. But this structural change is often a tough time for everyone and some people might leave because it’s no longer the business they joined. If people do decide to move on, you need to recognise that it’s a normal part of any developing business.

Like the sun

It’s often at this point that business founders come to fully recognise their key leadership role. People have joined the business because they want to follow you. When it comes to setting the business culture, you’re like the sun – the energy source and driver of the culture through your own behaviour.

The future success of the business is totally dependent on how you manage this structural transition because your behaviour is so influential. The first functional change lies with you before the rest of the business can follow suit.

Remaining totally reactive to whatever happens in the company will slow growth and tip the business into a predictable black hole.

Consciously introducing a functional structure right from the beginning enables your business to jumpthis black hole – and makes it well prepared to fly into the next phase of growth.

Click here to see Darren Shirlaw, co- founder and CEO of The Shirlaws Group introducing the concept of “Jumps” at our recent Shirlaws Client Conference.