Flourish: How to achieve your potential
I think I finally understand. To get what I truly want from my business I have to step back a bit. It really isn’t all about me. It is more about focusing my time, energy, and attention on where my strengths play to their best outcome and give room to others to apply their strengths to work with me. I need to pull my fingers back a bit and not be involved in everything.
I need to grow personally before my business can grow to achieve its potential.
There comes a point in the life of every small to medium sized business where the founder will be faced with the decision to grow, or not to grow. This usually means loosening the reins and bringing in new management to help lead the growth of the business.
Yet, even the word management can put some tension on the entrepreneur’s shoulders. Doesn’t management mean loss of flexibility and the true spirit of being an entrepreneur? The answer is no. And ironically, management and systems are what make a venture truly free to grow without being limited. Structure actually gives us the framework for flexibility. Without structure we just have chaos.
The catalyst for growth is really about the entrepreneur loosening-up on the reins.
The number one reason why business owners decide not to grow from this point is because their businesses have become too owner reliant.
If a steady and clear vision for the future of the company was never maintained separate from the founder, but instead was entangled with the self-identity of the entrepreneur, growth will become very difficult to achieve. The owner has become inextricable from the business and vice versa.
A founder who has taken prior steps to untangle their personal identity and sense of worth from the success of their business will have already made sure to have,
I. Had a clear and independent vision for the future
II. Identified their unique contribution to the business
III. Build equity as well as revenue
A business owner, who has set themselves up from day one to personally grow in a healthy and productive way independent of their business, will be healthier and less stressed. He or she will naturally have greater personal well-being and will have more time to focus on their company's vision with a grounded perspective. Whereas, most entrepreneurs get stuck in the day-to-day slog of trying to control all the moving parts to find success.
Let's look at how these planned steps to a high-growth future would have positively impacted the ease of transition from owner reliant to larger-scale, independent company.
Had a clear and independent vision for the future
Having a clear and independent vision for the future for both the person and the company is the most important aspect to maintain throughout the entire development of a business. The reasons are as follows,
● Invested in personal growth ahead of company
○ A business owner who allows themselves to grow ahead of their company will always be prepared for what comes next in the timeline of their business.
● Surrounded themselves with people who understand their vision
○ An entrepreneur needs to be able to clearly articulate what it is they want from the business and what direction they aim to take it – and why. Without a clear direction, no one can help bring a founder's dream to life.
● Don't become complacent
○ Without vision and goals for the future, founders can become complacent and sidetracked too easily. People can become settled where they are and lose their drive to grow. What do you want and how are you going to make that happen? That is how you keep contributing value personally, to customers, to your team, and to your community
Were clear on their unique contribution
If a founder knew exactly what their highest and best use was in the support of their company, it would be a lot easier to move over and let others in when needed. Instead of an agnostic approach a great entrepreneur will focus on vision, strategy, culture or whatever they do best. The effect of which is as follows,
● Standardized processes in place
○ It's impossible to measure deviation without a standard. Without the ability to measure what went wrong and investigate possible solutions, a company will fail. It’s also important to recognize what went right and build on it. Processes help make things happen without overthinking or duplicating.
● Built a team that compliments the founder's strengths
○ When a team is constructed that is capable of working toward a unified goal, and every team member understands how their specific contribution to the process results in the overall success of the business, the founder is able to focus on vision.
● Identified opportunities to grow
○ When the founder understands their exact contribution to the overall team and has hired people who understand the same, the business, overall, is put in a better position to identify opportunities to grow. Everyone is a specialist in their particular areas.
Build equity as well as revenue
A critical step for a business is to build a revenue stream that provides for the company and the owner to profitably move forward. Too much attention emplaced on generating revenue can result in a hyper-transactional focus.
It is equally important to grow a company in order build the equity value (the ongoing worth of the business) with the revenue. Too much focus on revenue and you have an emergency ward. Though a fixation on future equity value can result in an unrealized dream. There needs to be balance.
To be clear, building equity does not mean taking on investors. It is about building the ongoing, dependable value of the business.
To build equity, focus on these three factors,
● Complete focus on revenue is transactional
○ A transaction service is limited to the availability of continuing new sales in their market. It is all about the next one. There is no resting. They can and will top out. It is critical that transactional companies build repeatable offerings, products wrapped in services or services wrapped in products, with a focus on developing intellectual property (the greatest overlooked opportunity for every business).
● No long term value without a focus on equity growth
○ Companies need to focus on equity growth just as much as revenue. Equity creates value and attracts more customers, clients and employees. It is about the brand, the intellectual property assets, the unique process and method, and people. The owner needs to focus on what creates unique and ongoing value for the business that lives without the founder that people would pay for.
● Building a strong culture
○ Building a strong culture is key to every independent company — some might say it's the ultimate milestone. Once a company has a passionate customer base, the culture and tone of the business will begin to take shape, possibly moving the company to places never intended.
In summary
A business owner who has taken the right steps to keep their sense of self separate from the company will have made sure to have,
I. Had a clear and independent vision for the future
II. Identified their unique contribution to the business
III. Build equity as well as revenue
When a founder is able to keep their self-identity and sense of worth separate from the business, they are more easily able to identify exactly what it is they personally want from the business and what vision they see for the business.
Keeping the founder and the business separate are key in defining both personal identity and business vision, without overlap.
Flourish: How to move beyond an owner-reliant business is a three part series focused on the growth of a successful business from the early, idea stage to the fully-independent, large-scale company while balancing smart business moves with a healthy founder mindset.
Part 1: How to hustle but not get scrambled
Part 2: How to grow without losing yourself
Part 3: How to achieve your potential
By Michael DeVenney