5 Steps To Building A Business That Doesn’t Need You
Many of us want to go to sleep at night only to wake up to see our bank accounts bloated with cash. We want to make money on autopilot. We want a business that doesn’t need us to be able thrive and be profitable consistently. However, there’s more to building your business well than simply having a business plan.
Regardless of how your business started, the fact that you are still in business means that you have been doing something right. Like most business owners, you’ve probably been lucky to some extent. To grow your business to the point where you can step out of it takes more than luck. Here’s what you need to know when building a business that doesn’t need you.
Step One: Scalability
The first and one of the most important factors when you want to build this type of business is scalability. By scalable, we mean you have the systems, structure, and support (people and tools) in place that will allow your business to continue to grow without your daily involvement and/or oversight. Most business owners have grown their business to a comfortable level and congratulations are due. However, growing your business to the level where it doesn’t need you takes even more strategic planning, proven implementation processes, lag time (otherwise known as patience), and persistence. But once you have the systems, structures and support in place, you are on your way to building a passive stream of income that will last for a long time. You’ve also created a valuable asset for yourself, which you will be able to sell all or part of to get some of your(“BST” – blood, sweat and tears) equity back.
As the business owner, you are ultimately responsible for the success (or failure) of your business. It’s your ship. Thinking that you’re most effective when you are below deck pulling an oar, swabbing the mess deck, or hoisting the sails is a huge mistake. If you want to build a business that doesn’t need you, the most important and effective place you can be is in the Captain’s Quarters (or better yet – on your island resort) monitoring the ships KPIs and setting the direction or course of your business. The sooner you can get in the Captain’s Quarters and the more time you can spend their the better.
Step Two: Fall In Love With Your Customers and Learn What They Need
By falling in love with your customers and taking the time to really understand their needs, wants, desires, and wounds you can become an invaluable resource and/or part of their lives. When you can make your customers lives easier, simpler, or more manageable, you’ve started the process of becoming a part of their busy, hectic life solution. Making sure your company is doing what it does really well – with serving the customer at the highest level as the number one outcome – will help you drive decisions that will have the biggest impact on growth…repeat business, upsells, and referrals.
Think of the at-home movie industry. Netflix took the “chore” of driving to Blockbuster on the way home from work completely off the table. Netflix provided instant in-home access to lots of movies and tv shows and the other movies were delivered to your mailbox – with a pre-paid return envelope to send the movie back. Netflix understood that their ideal customers loved watching movies and tv shows, but didn’t like the hassle of taking time to drive to the video store. RedBox also got in on the action and has stayed in to some extent because – while you still have to go pick up your movie – you can do it while you are at the grocery store, getting gas or at McDonald’s. Their online interface lets you reserve movies and their in-store interface makes video selection a simpler process. Amazon Prime also allows for at-home viewing and if your movie or tv show isn’t included in Prime, you are able to purchase or rent it online instead. Blockbuster and other video stores got completely shut out because they were out of touch with their customers and they weren’t concerned enough with their customer’s problems (busy life, no time) to evolve. Bottom line: be very concerned with your customer’s current and future needs/wants/desires and wounds and always be thinking about how to make their lives (and in some cases their customers lives) easier and simpler.
Step Three: Have a Clearly Defined Yet Completely Adaptable Growth Plan
Creating a business that runs itself requires strategic planning and adaptability – and you have to have a plan for staying on top of both. Below are some tips for optimizing your growth plan:
- Creating a limited offering of products and services makes your systems, structures and support easier to document and execute – irrespective of who is managing the production line or heading the teams. Focus. Do what you do really well – do not try to be something to everyone.
- Defining your offer funnel will help you and your team understand all the different ways your customers can enter into a buying relationship with you and where you ultimately want them to be in your customer portfolio. Mapping this out will help you define your strategies for finding, engaging and nurturing prospects, as well as marketing and selling to your current customer base.
- Future planning your long-term vision for the company’s growth and bringing key players (in a large company) or all players into the conversation and strategy for long-term vision and goal planning. Building a culture of “all oars in the water and rowing in the same direction” greatly increases both individual and team performance and takes a lot of the pressure off of just you to make things happen.
- Conducting quarterly strategy meetings to create/revisit your 6/12/18 month goals in regards to ever-changing customer needs/wants/desires/wounds as well as anticipating technical advancements, trends and possible industry/technology disruptions. Having a system to help you and your leadership team stay on top of industry and technology trends and possible disruptions will keep you ahead of the curve in terms of helping your customers before they even know they need help.
- Fostering a culture of accountability and transparency is crucial to implementing a successful growth plan that you do not have be hovering over. Creating KPIs and automated systems for capturing and reporting on those KPIs helps create the transparency of how the business/team/department/individual is doing and allows for dashboards – which you, as the business owner, can monitor and then direct any questions you may have to your leaders.
Step Four: Really Taking Care of Your People and Empowering Them to Achieve More
Your people are everything! It doesn’t matter how big or small your business is, your people are going to carry the business and the imperative role of taking care of your customers. People have a natural desire to do well, contribute and feel like they are appreciated and doing a good job. Following these tenants will help ensure that your people thrive:
- Empowering Your People – Your customers are going to depend on your people to help them solve the problems that you said you could solve. Empower your people at every level of your business to make as many timely decisions as possible in order to help customers either move forward in sales process easily or solve any problems they are having quickly and effectively. Keeping decision-making out of the hands of your people is a fatal mistake – it delays the process of taking care of your customers and it disempowers your people. Creating well thought out parameters and possible solutions for customer sales migration and solving solutions is the key to empowering your people to help your customers.
- Coaching Your People – Your leadership has to be helping your people be successful at every turn. Communicating clearly defined job roles, responsibilities, and expectations has to be top priority. People can’t win the game if they don’t know how to. Providing simple and effective feedback is another key in successfully leading people. Your KPIs will let you know if your people/teams are on track or not. Your leadership should be checking in with their teams and people weekly to have a quick conversation about what’s working, what’s not working, where they need help. Having a structure of consistent, proactive communication combined with transparency and accountability will provide a culture of success that will help your leadership team consistently challenge and coach your people.
- Training Your People – Training is a vital part of taking care of your team…but not all training feels helpful. Your people are busy and want to do a good job for you – their time is precious and needs to be respected and considered when you plan your training schedule. Your job is to support your leadership in helping all of your people be successful. That training has to be timely, relevant, brief, and effective. Sitting in endless meeting, listening to training that may or may not be relevant is a waste of your people’s time and a waste of your resources. Training should focus primarily on upleveling skills, adopting of new systems for better effectiveness, mandatory industry/regulatory training (i.e. HIPAA or SAFETY), and/or mindset and culture. Planning your training around key times (end of month, end of quarter, end of year) is critical, as is asking your teams what they think they need in terms of training and upleveling.
- Supporting Your People – Supporting them in their work and in their lives makes a huge difference in your people’s quality of life – therefore improving their quality of work. Making sure your compensation plan is fair(preferably more than fair) and competitive and having generous key benefits can help you find and keep really stellar team members. When people feel like they are appreciated and taken care of, they are able to focus more on their work and are compelled to work harder. Look at what your offering, see if you can offer more and create an implementation plan to take better care of your people.
Step Five: Hone Your Leadership and Your Mindset
As you grow your business to the point that doesn’t need you (in terms of time), how the business needs you shifts. Directing the course of your business will always be your responsibility – until you sell all or the majority of it. You need to be strategic in your leadership so your team buys into your mission, your vision and readily does the whatever it takes to keep you on course. Dedicating your time to the most important matters is paramount. How do you know what to focus on?
- Putting The Right People In The Right Place – If you used to be the salesperson – you’ve got to create and document your sales process and sales syntax and find the right person/people to take on sales. You’ll need plenty of time to train them up – so get moving. If you were head of development and QA – you’re going to have to determine your long-term development plans, find team members who can take on your responsibilities or shift their responsibilities, create development protocols (AGILE) and tracking, outsource or hire new resources and train them, etc. If you were a member of the electrical crew – you’ve got to standardize and document your protocols, hire and train someone to replace you in the field. All this being said – you probably like the parts of your business you are doing. That’s great. We’re not saying don’t ever do them – we are saying don’t ever NEED to do them. There is a big difference. Get them off your plate and once you’ve got everything else set up for you to be able to walk away from the daily operation of your business, decide what you want to be a part of and how much time you want to spend there.
- Cultivating a Successful Culture – Part of setting the direction of your company is cultivating the feeling of your company – the feeling your customers get from working with you and the feeling your people feel from working for you. Of course, determining the company’s mission and vision is part of that, but it’s not all of it. Go a step further and, in collaboration with your team, figure out the values of your business. Values are qualities and characteristics and they define how you and your team show up every day for your customers and each other. If you think that culture is just some fancy new wave thing, you’re wrong. Every business always has a culture – it’s just that some business owners don’t choose to create culture and so the culture gets created on it’s own….which is not necessarily a good thing. There are two bakeries in our town that have withstood the 20 plus years that I’ve lived here. The first is owned by an Austrian man and his Polish wife. The food is delicious and consistent and european. The decor is very old European and you will often find it full of local people who moved over from Europe. The second is an artisan bakery with delicious and consistent food. It’s very artisan and rustic – lots of wood – local artist showings on the wall – no kitch. It’s got a bit of a hipster vibe and is also packed. Different crowd, but great. They are not in a hurry to get you your coffee, because good food and drink takes time and patience – but they are super nice, chatty and friendly. Both of these are examples of an aligned, solid culture. These businesses exude their culture and hire people who can blend with and add to their culture…and…you know the experience you are going to have before you step foot in the door. Conversely, the is a french bakery in my mom’s town that offers mediocre pastries and food. It’s thought of as snooty and not very good. They stay open because of their cake business (weddings, birthdays, etc.) Their business is a necessity, but if another baker came in and offered a cake business and a better culture – which bakery do you think would win out? Culture drives experience. Experience drives repeat and referral business. Pay attention to your culture.
- Paying Attention to Your KPIs and Ensuring Systems, Structures, and Support are Being Upleveled for Continuous Growth. Once you decide that you want to create a business that doesn’t need you – you are putting your business on a growth trajectory. It has to grow to be able to succeed without you. In order to grow in a smart and scalable way, you have to have measurement standards across your business, because you cannot improve what you don’t measure. While your leadership team should be responsible for staying on top of key metrics and proactively problem solving them, you absolutely should be seeing some high-level reporting on key metrics daily as you begin to step out and then weekly (at a minimum.) Know what you are looking at. Know what you are looking for. Know who you need to reach out to if the numbers are starting to look off. Demand proactively from your leadership team and demand it from yourself. Once you and your team get in the habit of monitoring KPIs and responding proactively, you will feel much more confident in stepping away from your business.
- Master Your Mindset. Being a business owner is like raising a child. It’s understandable that you will be very attached and somewhat fearful of letting go of key parts of your business. No ONE will ever be able to do everything you’ve been doing at the same level – BUT – there are plenty of people out there who can do any part of the job you have been doing at a much higher level. Keeping in mind that you are not looking for one person to replace you, but a team of superstars to replace all the jobs you are doing will help ease your mind. You’re not looking for Superman, you are looking for the Avengers. Transferring power in your company is a complex process. Often business owners really benefit from a coach, mentor, and/or a mentor/mastermind group. These groups/people can help you focus on the end game and help you move through the macro and micro views of your business and what has to happen next in order to move forward successfully. Be patient with yourself. Be patient with your people. And keep moving forward!
Finally – You are Ready To Create A Funding Strategy To Exit Your Business Or To Shop for a Successor
When the structure of the business has taken shape, and everything is running smoothly in a growth trajectory, it’s time to hire your successor. When hiring a successor, check out their technical skills, experience, and leadership qualities – as well as – culture fit. Have a transition plan, don’t rush yourself out of your business, follow due diligence, and never hire because of loyalty. Hire slowly as this is a really important hire. Spending the time necessary to train your replacement is critical because you want to avoid micromanaging the business after hiring a successor. It’s important to allow your replacement a free hand, but stay in constant contact until they are truly ready to fly.