Planning vs Commitment
 By Mike Hihn

"The best laid plans of mice and men often go astray" ... especially if your people aren't fully engaged in achieving those plans.

When I was just starting out on my own, in the mid-70s, people kept telling me "Entrepreneurs and business founders are ego-maniacs who refuse to delegate responsibility."  I heard that mostly from corporate managers and academics.

For corporate managers, delegation is almost risk-free.  A bad decision doesn’t cost them a dime.  For you, bad decisions come right out of your pocket – the full cost if you’re a sole owner.

Most founders/entrepreneurs would love to delegate more responsibility -- if only to satisfy their spouse and spend less time at work, now that the business is stable and growing. 

In most cases, business owners don't delegate for the same reason they don’t go bobsledding.  They don't know how to.

It's not just delegating.  That's easy enough.  It's what comes next.

They’ve never done it before, so many founders/entrepreneurs don’t know what to delegate … or how to measure performance on what they've delegated.   (They often nod and smile when I say that.)

That's why God invented the Entrepreneur Coach.  To help manage the transition from Owner/Founder to CEO.

Is it your time yet, to start that transition?  This piece may help you decide that.

Here's a dilemma.  The primary barrier blocking your path to future growth can be … your own success.

As your business grows, you require more and better planning, over longer and longer terms, considering more and more factors. 

The more you grow, the more people you need, the more difficult it becomes to fully engage your growing number of new people and personalities.

Your personal energy and drive (and perhaps that of your spouse and kids) has been a major factor in your success.  But there's a catch.  Because of your success and growth, your personal efforts and achievements are now an ever-shrinking factor in continued business growth.  (Might that be affecting you already?) 

At this point, many businesses fail.  Not from slow growth or no growth.  But from growing faster than they can manage.

If you make it through that phase, an even bigger threat is yet to come.  Even most successful businesses fail … in the second generation.  You may need a Succession Plan. 

Others could grow much faster, by doing “the management thing” first and then creating the growth.  But what kind of management and where?

I learned this from my very first client.  As your business grows and prospers, you may eventually wake up screaming, from a nightmare.  Your business, your legacy, has become (gasp) a bureaucracy.  (He may have been kidding about the wake up screaming part.) 

As far as I know, the only way to avoid that nightmare is to learn and practice Entrepreneurial Management.  That’s quite a tongue twister.  It means providing your business with higher-level management tools, as and when required by growth, to assure the following: 

a)      Better manage where you are today on the growth curve. 

b)      Achieve and manage more growth tomorrow. 

c)      All without creating the type of corporate bureaucracy you may have escaped from in the first place.

You have succeeded!  Succeeded where most have failed.  Now … are you ready for your next challenge?  Might your business be getting too big for you to run personally?

Entrepreneurial Management spreads your own goals and rewards throughout the organization.  You can’t be everywhere.  But your drive, your motivation and your spirit can.

You know how good it feels to own your own business.  How can you help your people feel that same way, about owning their own job?

I'm tactical and strategic by nature, even in my personal life.  But planning alone is the Holy Grail of government agencies and bureaucratic managers.  On my entire web site, this page is about the only place I mention planning.

This page is about results, how to measure them, and how to achieve more.

We're all a product of our individual life experiences.  Here are some of mine, and what I learned from them.

At the age of 27 (I'm now 66), I ran the entire Sales Training Department for (in today's dollars), a billion-dollar corporate division (Royal Typewriter).  I was then the only training manager in the Sales Department.  So I was the primary (hands-on) manager in developing management candidate/grooming/training programs for 100 Branch Sales Managers. 

 From there, I learned the importance of training. 

And proper goal-setting.  My supervisor, a Senior VP, wanted a reduction in cost-per-trainee, but left it up to me to decide how much I could achieve.  I committed to cutting that cost by 50%.  He laughed.  Until I did it.  (Most of my budget went to airfare and hotels for trainees, instead of training. So I shifted much of it to in-branch, instead of division headquarters, and also got better results.  )

My employer was then in the midst of a major turnaround from heavy losses.  While all other cost centers had their budgets slashed, I won a near doubling of my own budget.  I knew what results to forecast from the expanded training, described them in detail, and even showed the division president how to easily track my progress. 

 From this, I discovered the value of combining empowerment with accountability.  I got a much bigger budget, which allowed me to achieve more, because I accepted personal accountability for the results of spending the dollars I asked for. (It took me a bit longer to inspire that in others.  And longer yet, learning how to coach it in founders/entrepreneurs.  )

As part of that turnaround, perhaps in desperation, we relied heavily on strictly defined, performance-based, job descriptions.  More important, that helped us define appropriate performance-based incentives and compensation.  Having started as a salesman, I already knew the value of pay-for-performance, on myself.  But from this, I saw that value proven at all levels of an organization, not just sales reps and managers.  See here for the results of my own first attempt. (link to entrepreneurship article, exact paragraph.)

My Senior VP supervisor was a PhD psychologist (with his feet on the ground). From him I learned that pay-for-performance can be critical, but there’s so much more to fully motivating people, and that different people often need different motivators.  I’ve prepared a brief summary of Frederick Herzberg’s pioneering work on motivation factors in the workplace.  In Mazlow’s Pyramid, we learn how different people can be happy at different levels of that pyramid.  Herzberg showed how to motivate them into seeking and achieving higher levels.  By tapping into self-motivation.

 From my very first consulting client, I learned how to structure the delegation/reporting relationship between an Owner and his General Manager. Herb was a massive guy, physically intimidating, with a booming voice.  He actually wanted his managers to stand up to him more.  “I need to be told when I’m full of (beans).” 

As one solution, Herb wanted me there (as an umpire and advising both of them) while negotiating goals and budgets with a new GM.  This was my first experience at negotiating specific and measurable results, at that level.   

Why negotiate?  Because it goes both ways.  The GM and I also obtained firm commitments from the Owner – which then made the GM more confident of his own commitments.

Getting a genuine commitment is a lot more difficult than setting goals.  Which of those two options is more likely to achieve the results you want?

Herb said he had retained me because I was only the second person who ever passed his test question.  He said he’d been criticized for paying a $20,000 bonus to a startup division manager who had lost $100,000.  I replied, “I’d have paid it too.  But only if you agreed to a budget with much larger losses.” 

I’m from Cleveland, home of the Center for Family Business, founded by Dr. Leon Danco.  Danco is generally considered the founder of family business consulting, workshops and books.  I worked with him in the mid-70s.  His fans will see Leon’s influence here.  Others should google his name, or search for his books at your favorite online bookstore.  Buy them all.   I

I began this piece by stating, ''The best laid plans of mice and men often go astray ... especially if your people aren't fully engaged."

How do we do engage them?

You engage your people the same way you've engaged yourself. 

I mean engaging the type of people you’re likely to hire.  The others are safely nestled in a bureaucratic womb somewhere, corporate or government.  Of the ones you’d likely hire, you may be surprised (I still am) by how many of them are just like you ... in several character traits.

They want more control over their lives.  Instead of goal-setting (like tablets brought down by Moses), they’d like some influence in setting at least some of their performance goals (group and/or individual goals, whichever is a factor in your own workplace)

They enjoy leaping hurdles.  Even better if the crowd cheers.  See here for an example of how it worked in even a mega-corporation like United Airlines.  (link to that opening paragraph in article),

They want more personal responsibility.  Not all of them, but enough.  Offer them more personal responsibility in return for more personal accountability.  “The same thing we tell our kids.”

Surveys repeatedly conclude that most people would love to be running their own business. But I've never seen a survey explain why they aren’t. Some of it is skills and money.  But mostly, they lack two of your traits.  (1) They don't like risks.  (2) They need the security of a steady paycheck.

Still, you can help your people take ownership of their own responsibilities … by allowing them to enjoy many of the same incentives and pride of ownership that you do.

Reading this website won't help your business.  I've been in too many places to give specific examples relevant to your own needs and opportunities.

There's only one way to see whether or not I can help you grow your specific business.   Ask me your toughest questions.

Grill me.  Face-to-face. 

To set an appointment:
phone  208-345-6140
email:  mail@Mike Hihn.com

Hihn has been a small-business consultant and entrepreneur coach for over thirty years. Contact him at 208-345-6140 or 877-596-6379 (toll-free).