It is often said in business that it’s lonely at the top.
Blog written by our sponsor and training partner, NEL Fund Managers.
At NEL, we often talk to businesses that have one or two directors who founded a company and have grown it by trying to do as much as possible themselves. As the business grows they find themselves stretched thinner and thinner until a point comes where they can’t continue to manage all the various parts of the business and still expect to grow.
At this point it may be necessary to bring other managers or business partners on board, building a senior team that can manage all the critical areas of the business and take it to the next level. Sounds easy enough if you say it quickly, but many businesses we see aren’t in a position that’s financially strong enough to engage senior managers straight away. Business owners are therefore often in a dilemma as to how to achieve their growth potential whilst retaining their sanity.
It may seem easier to stay at the same size, work harder and pass on those growth opportunities, often turning work away because the business does not have the capacity or resource to fulfil some of the orders. However, the inability to evolve and grow can often lead to stagnation and, in many cases, the business starts to fade as competitors catch up and take away work.
So the business must take advantage of its opportunities and grow in order to survive. The operational and sales teams grow and a new middle layer of management may appear between the owner-managers and workforce. Before long the business has a much larger number of people and the directors’ roles will have changed drastically.
The company may need funding and investment to achieve its growth potential but, without the right team in place or a plan to recruit the right people, many funders will be unwilling to invest in the business. So how do the directors find the right senior people within a tight budget and a restricted cash flow that is typical of a growing business?
One answer may be to find someone who has experience of growing a small business, and maybe selling it successfully, who can work with the business on a part time basis. Someone entrepreneurial with the right set of skills but, most importantly, someone who the directors like and can work with, and one who shares their vision of where to take the business. Another important addition to the team will be someone in a senior finance role.
Have a frank and honest discussion with yourself or a trusted adviser and identify the skills you lack. Find people who might fit with the ambitions of the business by networking, introductions and recommendations. Build the team around you that suits the business at the time. As the company grows it can recruit the right people, but getting to that point through the critical do-it-all-yourself period can be the key to success.