15/10/2010

By Andrew Lester

As an owner or director of an SME (Small and Medium Enterprise), regularly doing yourself out of your own job or moving on, requires a steady stream of new initiatives and business opportunities of sufficient scale to signal a difference. Whilst it is obvious that you can move on by restructuring the business to work without you, you can’t do this regularly unless there are material opportunities to redevelop the business.

Ordinarily this means identifying new opportunities and defining, launching and implementing significant new propositions that materially impact the company. Mere product range extensions are usually insufficient by themselves to make enough impact. As such owner / directors need propositions that change the dynamics of the company to allow them to refocus and move on.

This is all very well and good in small fast expanding businesses, but in more mature organisations with stable propositions and customer bases the opportunities to redefine the company tend to be modest. No one is going to “bet the farm” on a new direction every year or so... it would be far too de-stabilising on the core business.

As such, the best way to provide the basis for “doing yourself out of your own job” regularly is to focus on all-new initiatives that either materially impact the processes and organisation of the core business and / or that open up new propositions to new or existing customers. This places a heavy burden on the owner / director to make sure that the whole company understands the continuously transitional role that (s)he plays in the business and that everyone values the regular changes and investments that go with it.

Additionally developing new initiatives and propositions has to be done in context. Businesses have their own core competencies, skills and intellectual property. It seems obvious not to start from scratch each time but to build on the strengths of the team. Many “entrepreneurs” have a very broad view of what the company does and the markets in which it operates. This broad view provides “vision”, but delivering on the vision requires also a keen eye for what the core business is good at, how it can evolve and how quickly. Stretching the business too far too fast from its key strengths risks customer, employee and shareholder revolt.

Managing new initiatives and especially new propositions requires a very substantial focus on two key areas: driving cash from the established core and managing resource investment (people, time, facilities, money) consistent with sustainable growth. Often organisations see change as disruptive, confusing and costly. Working in a constant state of flux is also tiring and inefficient— unless you are very careful, the company loses opportunities to drive cost efficiencies on the core business, as new products and propositions take inappropriate levels of focus and resource.

The task for owner / directors looking to move on regularly therefore, is to recognise the scale needed for meaningful change and to protect the core cash generating operations from negative disruption. By definition, scale that is sufficient to allow senior players to “move on” has the power to be very disruptive. The Golden Goose always has its place: make sure it remains well fed.

Please feel free to comment by contacting me: andrewlester@carr-michael.com

Andrew Lester is Managing Partner of Carr-Michael Consulting, specialists in growth management and business performance improvement.