Entrepreneurs are a unique breed, known for embracing risk and believing in their vision with unwavering resolve. They accept risk. They have a high degree of self-belief. They exhibit a deep level of resilience. They demonstrate perseverance, persistence, and grit. And they’ll get things done, come hell or high water, often preferring to roll up their sleeves and do it themselves, sometimes because there’s no one else around to delegate to. In other cases, entrepreneurs embody the saying “If you want something done right, do it yourself.”
This approach is needed when a business starts up. Resources, especially money, are limited, and it takes a driven founder to successfully launch a business. However, once a business starts to scale, these qualities can come back and bite you in the ass. When founders fail to grow beyond the start-up stage, they risk stalling their business, or even steering it towards failure.
Key Person Dependency is the term used when a business’ ability to operate hinges on one individual, leading to bottlenecks in decision-making, knowledge-sharing, and delegation. In many cases, Key Person Dependency is rooted in a lack of trust.
This makes sense. A founder has usually placed a huge bet on the success of their business, risking money, time, pensions, and reputation to build something meaningful to them. The founder has an enormous stake in play, more than any employee or consultant (though co-founder will have a similar stake and can exacerbate Key Person Dependencies by implementing individual or combined bottlenecks of their own). When there is so much at stake, it’s very difficult to trust others that don’t share the risk of entrepreneurship.
But that trust in others is exactly what’s required.Scaling a business demands repeatable processes that reliably sell, deliver, and satisfy customers. That’s relatively easy to do when there are only a handful of customers on the books. It’s infinitely more difficult to achieve when there are hundreds or thousands of customers.
Have you ever found yourself doing a task because you felt that no one else could do it as well as you?
From a strategic perspective, a founder or co-founder that continues to cling to their initial role of Chief Cook & Bottle Washer fails to grow alongside the business. As a business scales, the founder’s role changes. They become CEOs, and necessarily need to take a strategic, long term perspective. They’re continuing to represent the business to customers, suppliers, employees, and potential partners, spending more time out in the world and less time at the coalface. These activities are necessary and non-negotiable for scaling businesses. What’s also necessary is that the CEO needs to be able to know that the business will be able to deliver on whatever results from those activities. The CEO does not have the ability to deliver it alone.
The good news is that Key Person Dependencies can be overcome with a combination of coaching, strategic planning and execution, and great process design. These are supported by a well-structured organisation that promotes a culture of delegation. Company objectives are framed with measurable outcomes, which are extrapolated into processes and systems that are supported by data. This enables data-driven decision-making and objectivity. In doing so, a system can be created that supports delegation, knowledge sharing, distributed decision making, and ultimately enables founders to see that their trust is well-placed.
Getting rid of Key Person Dependencies isn’t an easy task, nor is it an overnight one. Often it needs the support of object experts who can diagnose and provide practical solutions for resolving it.
Do you find yourself constantly drowning in tasks, convinced only you can do them right? Is your to-do list neve-ending, with new tasks constantly crowding out strategic thinking? It’s time to re-think your approach.
Ready to break free of key person dependency? Let’s discuss how we can help your business scale without bottlenecks. Contact ScaleMe@squirrel9.com now!
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