In order to prepare your business for sale or transition, you have to start delegating more of your responsibilities to others. For the full article, go here.
The Business Transition Blog
Robert was frustrated. He worked for an opinionated, controlling, autocratic boss named Ivan. Robert was the sales manager and in the past he had given everything to the company. He liked the business, the work and the customers – and he had a grudging respect for Ivan, the owner of the business. But he was expected to make sales projections and budgets without knowing the past year’s financials and results. He was expected to increase sales, but had no authority to invest in marketing or sales promotions without getting Ivan’s approval. There was an implied (but not clarified) agreement that someday Robert would buy the business, but at this point he felt that he was a puppet, doing only what he was told.
Should Robert have the authority to spend money without approval? How much? How could he be accountable for results without having the authority to do what was necessary to make it happen?
Robert’s case isn’t unusual. He wanted more authority than the owner was prepared to give him. He felt that he wasn’t trusted, that he held a title in name only, but was powerless to really excel in his role as sales manager and possible successor to Ivan. This was demoralizing.
When I talked with Ivan, he clearly didn’t trust Robert. Robert made a mistake several years ago that cost the company money. Unfortunately, there had been no frank discussion about it, why it happened, how he could redeem himself after that experience, and, most importantly, the lessons learned. As a result, Ivan continued to treat Robert in a paternalistic manner. So Robert “lived down” to Ivan’s expectations. Responsibility without authority is demoralizing.
There are four levels of authority that can be given to a prospective successor depending upon the current level of the successor’s experience and skill, and the current level of confidence the owner has in the successor.
- Just do it. There’s no need to ask for permission, get approval or even report on it. Just get it done.
- Do it and report. In this case, keep the owner in the loop, but you don’t need advance approval.
- Do it only after discussion. The successor should consult with the owner and get their advice, but in the end, the successor makes the final decision without interference from the owner.
- Do it only after approval. The successor presents the situation, outlines alternative solutions based upon research and then makes recommendations based on the best rationale. The owner then approves, disapproves, or requests additional information. The successor does not move forward until the owner says so.
If you truly want to groom a successor, you must give them responsibilities that help them grow, authority that is clearly defined and advancing over time, and feedback that will help them learn from your vast experience and wisdom.