Are you the barman or the bottleneck?

From Harvard Business Review – Brett Martin and Thanos Papademtriou

You may be the reason your company isn’t growing. You are micromanaging — and it’s stifling the organization you are trying to build.

Our research tells us that the very management style that enables a founder to get a company off the ground — a zealous focus on tactical execution — often derails growth down the line. Lost in the heat of battle, many entrepreneurs fail to adapt their management style to the evolving needs of their growing organizations.

Take for example the case the shipping firm MaritimeX. Built from the ground up by childhood friends from Greece, Aris & Stavros, MaritimeX had grown from a peripheral two man shop to a regional powerhouse with 25 employees. There was only one problem: the firm’s revenues had plateaued at $9M for three years straight. Despite working harder than ever, MaritimeX’s founders could not break into eight-figure revenue.

A quick look at their workflow revealed the problem instantly: Every single client enquiry had to be evaluated by one of the founders. Because each new proposal took at least a week, if not two, for Aris or Stavros to assess, prospective clients frequently defected before someone at MaritimeX even laid eyes on the opportunity. The founders felt that they alone possessed the knowledge to respond to such proposals. But even with both founders evaluating new business around the clock, MaritimeX could only handle a few contracts at once. As a result, the company frequently passed on requests to perform highly profitable specialty charter and vessel valuation services. Aris & Stavros had become bottlenecks within their own firm!

Aris & Stavros had some very important decisions to make, both financial and personal. Did they aspire to expand at the risk of delivering inferior service or damaging treasured relationships? Or, did they wish to stay small but successful, assured to impress their clients through personal involvement? What was more important to them: growth or control?

Entrepreneurs can have both. Here’s how to dispel the three most common excuses you might make for not letting go.

  1. The Decision-maker Excuse:“As the ultimate decision maker, I need to do everything so I know about everything.”

Entrepreneurs cannot avoid getting their hands dirty with the nitty-gritty. That said, decisions and the information necessary to make them should be pushed down the ranks whenever possible. That way, the entrepreneur can pursue activities that truly no one else can do, such as figuring out the big picture.

  1. The Quality Control Excuse:“Delegating tasks to people less competent than myself produces inferior results.”

All founders hate to watch employees make “avoidable” mistakes, but savvy entrepreneurs remember that perfect is the enemy of good (and in many cases, growth). Anticipating employees’ shortcomings is not an excuse to do everything yourself. Successful entrepreneurs know that their time is best spent preparing their employees for potential difficulties and helping those same employees learn from their mistakes. Only then can future mistakes be avoided.

  1. The Revenue Excuse:“Time spent training employees is wasted (i.e. non-billable).”

“Give a man a fish, feed him for a day. Teach a man to fish…” well, you know. Routing every decision through yourself is unsustainable. Entrepreneurs that fail to evolve their management style from “doer” to “coach” will never have the resources to seek new opportunities!


Do any of these points resonate?

Ask yourself these simple questions if you want to grow your business.

  • How much time do I spend working in my business rather than on my business?
  • If I hadn’t founded the business, how much of my job description reads like an employee’s?
  • How much time do I spend reading emails that require me to make “the decision”?
  • How many times do my employees run their thinking past me before making their own decision?
  • When I look across my staff, who do I trust to make well considered decisions – do I free them up to do so consistently?
  • How often and how much time do I set aside to think about the business at the macro level?
  • Do I have the right team to contribute and execute on the strategic direction of the business and are they empowered?