Mitch Levine, CEO, Corporate Finance Solutions
Most companies’ founders are responsible for the majority, if not all, of the management responsibilities, as well as some of the production, service or administrative responsibilities. There’s no need to delegate responsibilities to others because no one else is willing to take them on.
However, as businesses grow, you must decide what responsibilities to delegate to others and which to keep. Delegate or do it yourself? These choices can have a significant impact on the level of success your company achieves. These decisions are still crucial for larger, more established businesses.
In general, I advocate for a large amount of delegation. You achieve four specific goals by delegating additional responsibilities and duties to those below you on the organizational chart.
Of course, you’re also lightening your workload, allowing you to focus on the most important tasks. That may mean you can unwind more and you can focus on tasks that are more appropriate for your level of responsibility within the company. You can’t do everything. Why bother? If you have two people only 60 percent as efficient and effective as you, then you have 120 percent of your own productivity; at most, they will be 70-90 percent as effective. A lack of delegation can result in a variety of issues. A true one-person operation with a flat organizational chart is not only a major risk in case something happens to that one person but it also reduces your attractiveness to top talent and reduces your company’s value.
Management succession is a big issue. One is the loneliest number, especially in business. Your customers can perceive if you are suffering from too much one-itis. They feel you are at risk and are more reluctant to do business with you. You also can get stuck in a rut of unresolved issues and missed opportunities. You will be frustrated and perhaps angry as a result.
On the other hand, too much delegation can also cause issues. You are responsible to lay out your vision, provide direction and resources. Without those, your company lacks both leadership and control due to the void at the top. Others may make decisions without considering the consequences for other departments. Furthermore, the outcomes of those decisions may receive little, if any, attention. Your company could sink into a stagnant mess with no centralized leadership to address the pressing issues.
Ask yourself, “Does it need to get done? Am I the only person who can or should do it? Can it get automated or outsourced or delegated?” Start by writing your own job description to find the right balance of delegation between too little and too much. Make a list of everything you’re responsible for, including items, functions, responsibilities and decisions. Then sort the list into those tasks that you absolutely cannot delegate to others, those that you could delegate to others and those that are a waste of time and should be delegated to someone else.
After that, create a column to rank the items that you excel at, those that your experience and talents are adequate for and those that you do poorly at. An examination of that chart should assist you in determining whether your delegation abilities are adequate and appropriate. Hint: this list should be short.
You should also draw an organizational chart for your company or department (if you don’t have one already, which you should). You may not be delegating enough of your responsibilities to others if you have more than six or seven people reporting to you. How many people can you supervise effectively, how many problems can you discuss in a day and how many decisions can and should you make?
You’ve only completed half of the exercise once you’ve determined the appropriate level of delegation for you and your company or division. You must also decide how you will track the outcomes of those to whom you have delegated various responsibilities. It is insufficient to simply say, “Here, do this.” You should then assess whether the task was completed satisfactorily or whether the responsibility was appropriately addressed. If it was, you might be able to give that person more responsibilities. If it wasn’t, you either delegated to the wrong person or made a delegating mistake that needs to be reversed.
Your ability to balance tasks, responsibilities, time allocation and priorities without the comfort of many black-and-white, yes-or-no decisions will determine much of your business success. It’s not that easy in business. Making delegating decisions is one of those tricky areas with few guidelines. Additionally, changing circumstances, such as corporate growth, may alter the correct answer.
Consider whether you have enough hours in each day to get everything done. Examine how much control you have over your business. Is it necessary for you to be involved in almost every decision, regardless of its importance? Do you find it difficult to let go of a responsibility you’ve held for a long time? Any of these are red flags for a lack of delegation.
Consider whether you’re getting too many surprises as a result of other people’s choices. Do you lack knowledge of critical corporate functions? Do you feel like you’re not as involved as you should be during periods of inactivity? Any of these could indicate that you’ve delegated too much authority to others.
You’ve probably delegated just about the right amount of responsibility and authority to those reporting to you in a smoothly running organization where you have time to focus on the most important items and sense when there are problems that need your attention. Monitor that level of delegation on a regular basis to see if it’s still appropriate for your company’s growth, complexity and environment. For more on this, see the book, “Whose Job Is It, Anyway?”
Mitch Levin, CEO, Corporate Finance Solutions, specializing in mergers and acquisitions, succession planning, strategic planning and financing. For more information, visit www.cofinsol.com or call 888-885-5656.
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