Question: “Should I hire an Operations Manager or just sell out?”
Steve’s Answer: “It depends. How long can you ‘hang on’?”
Hi Steve,
Here’s the deal, Steve. I loved SFS! But I need to hire an Operations Manager so I can get away from the day to day activities of my business. I am too stressed and working way too much which is seriously affecting my relationship with my family and even my physical health. Simply put I need to “step away”. If I can’t find an Operations Manager then I really need to sell my business.
Any advice on how to do either one of these options?
Pondering in Pensacola
Hi Pondering,
I’m assuming this desire of yours did not spring up overnight so very probably you either have developed other priorities in your life than your business and/or are simply burning out! If so, I feel your pain! I’ve been there and felt that! But a few thoughts:
Don’t expect this challenge to get resolved overnight/ next month or maybe even next year. Changing into being an “Absentee Owner” (where you have someone else making day-to-day decisions) or selling your company are both long term processes. However, the good news here is the initial steps needed to sell out OR put a manager in place are the same in the beginning. GREAT! What are they?
1. “Work yourself out of a job”- My guess is like most entrepreneurs YOU are the “funnel” in your business. Everything runs through you. YOU make the decisions, YOU do the selling, YOU do the purchasing, YOU do the scheduling and you very likely are the janitor and chief bottle washer too! And YOU work harder than any normal human being can or should work!
If this describes you, Pondering, then congratulations on your insane initiative and incredible energy! BUT the problem is both your potential Operations Manager OR your prospective buyer likely will be … NORMAL human beings! And they simply won’t or can’t work at the demon entrepreneurial pace you have set! Sooo…
2. Slow down! Maybe during this transition phase you aren’t going to continue your fast growth and/or maybe you won’t be quite as profitable. Instead, you are going to focus on building systems and procedures to replace … YOU! (This thought should make you feel all warm and tingly inside!)
This transition will include building actual written systems and procedures to either delegate the many tasks you sort of “automatically do”. Or it may include coming up with a job description(s) to hire people to replace parts of what you do.
Notice here I said “parts of what you do”. One huge trap for an entrepreneur when searching for a manager to replace them is to assume one single hired employee can continue the super human “Entrepreneurial Pace” the owner has set. NOT going to happen! So break what you do now in your company down into digestible parts by using the “divide and conquer” technique! After doing this you need to…
3. Decide on selling your company versus keeping it and becoming an “Absentee Owner”. IF you can do it both logistically and emotionally the Absentee Owner route is almost always the best way to go financially. Why? Because no matter how much you sell your company for it likely you likely will not be able to completely retire just on the interest from the proceeds. (Have you checked the rate of return lately on savings? Pathetic!)
On the other hand a well run cleaning and restoration business should easily spin off enough “excess income” to keep you very happy in retirement plus remember that you can always sell the company down the road if you wish. Even better, IF you develop a Critical Mass company that will continue to grow without you then it will be even more valuable in the future while providing you retirement income now!
However, notice I stress both the logistical and emotional challenges of creating this Critical Mass business that you will ALLOW to run without you. Frankly put, Pondering, the typical neurotic, obsessive, compulsive entrepreneur finds it almost possible to leave his “baby” in the hands of another without constant fretting and meddling! So if you see yourself in this scenario then maybe it will be better to sell your company instead of training a manager.
NOTE: If you decide to sell then please download and read my “Cashing Out” Special Report on how to prepare your business for a profitable sale.
CAUTION: Be very certain you truly are ready to sell “your baby”. Many times an entrepreneur gets fed up/burned out, impulsively sells their business and then bitterly regrets it later! (I call this “Seller’s Remorse” and it actually happened to my mom.)
But IF you think you are ready to be “hands off” while keeping your business then you can keep your options open. So then you must…
4. Look for a manager. Where to go? If at all possible look first inside your company. You know your employees and they know your company. So see if any of them have the potential to fill PART of your shoes. That’s right- once again the biggest mistake retiring owners make is they expect the successor they hire to do it not only as well as they do BUT also to do it exactly like they did AND to do everything they did. Not going to happen!
So see if you can divide up your responsibilities among different employees. For example, one might be in charge of sales and doing pre-inspections, another in charge of the office and another focused on operations and hiring. One person in this “trinity” will need to be the “head mugwump” simply because every ship needs a captain.
Each of them will need to have their responsibilities clearly delineated and be used to working well with the others on your team. And they all will need to have a “piece of the pie” in NEW profits they add to the company. (However, I usually discourage entrepreneurs from giving away equity in their company- at least at first.)
And as you remember in SFS you will need to make everything in your organization “easier to do it right than to do it wrong”. How? With written step-by-step procedures and systems that interlock to form a wonderful Business Infrastructure– 4,000 pages of which you received in your Strategies for Success seminar.
Building this Business Infrastructure will be necessary whether you sell your company OR you turn it into a Critical Mass business that gives you steady cash flow while you enjoy a wonderful semi-retirement. And you already know that your SFS team is ready to help you!
Steve
PS Now Pondering, I know what I describe above will not be an easy or fast project. However, our newly revised SFS program is totally focused on giving you the tools to achieve personal freedom by becoming an Absentee Owner. I would STRONGLY encourage you to reattend SFS soon and focus gaining the tools you need for your goal of Personal Freedom.