Welcome back to our discussion on No Man’s Land. In last week’s blog, we discussed the trials and challenges of market misalignment, and how to overcome this tricky situation (a refresher can be found here.)
So, now that your company has been growing and may even be heading toward misalignment, you need to look at making sure your business stays on track. The way to do this, according to Doug Tatum, author of No Man’s Land, is through experienced management and a control system that protects and enhances the firm’s core value proposition.
Why is this important? Well, the value proposition is, after all, what brought your customers to you in the first place.
To make it through No Man’s Land, a growing company needs to complement the entrepreneur’s skills and ideas by introducing experience based expertise. The best way to do this is for the entrepreneur to delegate to senior management or other positions with high influence the responsibility of implementing and managing the control system. Although delegating this power may bring about a fear of losing control of the company, delegating is the only way to gain back control in a growing business. To be successful with delegating this power, you will need people by your side who have experience and can prove they know what they are doing.
To grow, you need a team that can implement change. This type of team provides many important benefits:
- A smoother route to securing funding which can drive the company’s pre-money valuation higher. Having an experienced team reduces business risk and acts as a powerful endorsement of the company’s potential.
- Allowing the entrepreneur to concentrate on what he or she does best as they switch to new roles. With professional staff establishing systems that perform operational tasks more accurately and efficiently, the entrepreneur has the freedom to set the course for the company as a whole and get back to why they went into business in the first place.
- New ideas and fresh perspectives. This new company DNA gives the entrepreneur the ability to look ahead and prepare for changes.
To decide if it is time for delegation of tasks throughout the organization, look for these symptoms in your current team:
- Weary and tired
- All decisions come back to you
- You are being stretched thin
- Making decisions based on instinct rather than fact
- Longtime employees in over their heads
- Questions that can’t be answered
- Difficulty in finding and retaining new talent
- Decision making has been hindered
A combination of any of these signs may point to the fact that it is time to face the painful issue of management transition. It is hard to let go of some employees, but it is important to remember that some people just won’t make it to the next level.
So, now that you realize you have a need for a senior management team, how do you go about hiring these people? Let’s dive into some common myths about hiring so you can learn the best practices to follow.
Myth #1: You need to determine where you are weak and hire in those areas.
- This advice isn’t terrible, but it can be worded differently to give it better meaning. Rather than focusing on where the business is week, its best to figure out the company’s strengths and protect them with delegating authority.
- “Companies need to delegate those parts where experience, knowledge, and accurate analytical judgement reign supreme”-Doug Tatum
Myth #2: For the company to grow, the entrepreneur needs to be replaced with a CEO.
- It has been said that entrepreneurs aren’t capable of leading a large company, but this isn’t exactly true. In fact, entrepreneurs often have exactly the skills required to bring a company immense success. Just think of Apple and Microsoft, to name a few.
Myth #3: Credentials are the most important attribute of candidates.
- Credentials are important, but it’s also important to stay true to company culture when hiring! This culture is the heartbeat of the organization, and envelopes the firm’s common understandings and supports its core values.
Myth #4: Culture is the reason firms fail to embrace outside hires.
- This idea couldn’t be more false. You want your new hires to be able to push for change while also adhering to company culture. The way to ensure this happens is by establishing trust. This way, newcomers won’t feel the need to overcome culture, but rather can prove they can be trusted to make decisions wisely and according to culture.
Myth #5: Professional Management ensures value and growth by ridding the company of chaos.
- As nice as it sounds to just get rid of chaos, that is not the case. The key to growing and making money is actually to mess the business up and then clean it up in a balanced manner. A certain amount of chaos is good for a company, as long as it is kept in balance.
Myth #6: A growing company should hire in the middle, not for senior management.
- This myth also proves false, as hiring in the middle increases the burden on the entrepreneur and can be harmful to the company. Hiring at the top allows a company to bring in someone with experience who can help the company grow.
These myths show that it is indeed important for entrepreneurs to get senior management who can take the company to the next level on board. So, if you find yourself ready to grow, it may be time to consider this step.
Keep in mind that failure to complete the management transition could keep you stuck in “No Man’s Land.”