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Owner-Managers Must Know When It’s Time To Delegate
Harvy Simkovits, CMC - Published in Boston Business Journal 6/18/99)

As their company grows, business owner-managers can get into a "delegation crunch." The owner-manager gets overloaded or overwhelmed with the ongoing activities of the business, but has no one available or capable enough to take over and manage on their behalf. Signs of owner-manager "delegation crunch" are: not giving proper attention to a critical aspect of the business, or working excessive hours yet still being behind on important matters, or being the bottle-neck (others always waiting for him or her) on important business decisions.

This delegation crunch usually results from a mindset that says, "no one else can do it as well or as efficiently as I can." Some business owners make half-hearted attempts to delegate responsibility and authority, but quickly take back the reigns at any sign of trouble — thus keeping them in the "crunch." Other owner-managers of very small businesses may balk at adding high-priced overhead, for it may mean having to significantly grow the business in order to pay for the additional key person. Nevertheless, there comes the time in every business where the owner-manager must selectively give away responsibilities if they want to see their business continue to grow and prosper.

To resolve this problem, one owner decided that outside marketing and sales was his best capability, and most crucial to the future of the business. Thus, he hired an inside operations manager to handle all production-related functions. Another owner felt that he was best at creating new products and new business ventures, thus went to find and grow general managers to run each new business that the owner developed. As a company owner, you must decide what is your best value-added to the business (be it marketing/sales, product development, operations or finance) and then install and develop key people to handle other important aspects of the business. Use the following guidelines to find the right delegates and then to increase their success in your company.

In seeking a capable delegate, first investigate your personal, business and industry networks. However, take particular care in bringing on a close friend or relative, for making a poor choice here could strain a friendship or close relationship. If your network does not surface the person you seek, then look to outplacement firms which help to place many laid-off managers and executives, some of which may be a good fit for your organization. Consider finding a key person who would be willing to make a financial investment in your business. This might lower your immediate cost of bringing on a highly capable person, and simultaneously provide an injection of funds for growing the company. Another possibility is to completely outsource the position. There are service companies as well as individual professionals that will take on all your human resource management or accounting/administration management functions. This is especially attractive if the work does not justify a full-time individual.

When you find a suitable delegate, be clear about the specific goals that you want your delegate to accomplish, and by when. Leave the "how" up to the person, because that’s what you hired them for. To build the delegate’s motivation, explain why those goals are important. State the benefits for the business (more efficient operations, increased revenue, etc.) and for them personally (sense of accomplishment, rewards and recognition, etc.). Provide your delegate sufficient authority (with customers, suppliers, employees, etc.) to carry out their goals. The last thing you want is for your delegate to hit roadblocks that you could have easily removed beforehand.

When you delegate, decide on how much control you want the delegate to have with respect to making decisions and taking action. Consider whether they should investigate situations and make recommendations to you before they act, or should they just go ahead and act and then let you know afterwards. Meet regularly with their delegate to check the status of action plans, and/or have the delegate write up a regular status report on their goals and accomplishments.

After you delegate, it is important to appropriately acknowledge the person for their performance. State whether it was below, at, or above your expectations, and why you see it that way. Also, maintain a record of the delegate’s accomplishment and areas for improvement in order to appraise his or her performance regularly throughout the year. Finally, assess whether the delegate can take on more responsibility, and what you think could be their best value to you and the company in the long run.

Business owners need to consider delegation as a tool for their personal effectiveness and business growth. By following these simple delegation guidelines, you will gain more security in giving away responsibility to key people, as well as increase your delegate’s success. This will yield significant returns for both you and your business.

Harvy Simkovits, CMC, President of Business Wisdom, works with owner managed companies to help them grow, prosper and continue on by offering innovative approaches to business development, company management, organization leadership and learning, and management education. He can be reached at 781-862-3983 or .

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