Delegate or die: the self-employed trap

[krbb91]

*Good stuff to apply in order to grow the money tree and increase passivity*

Delegate or die: the self-employed trap. | Derek Sivers

Most self-employed people get caught in the delegation trap.

You're so busy, doing everything yourself. You know you need help, but to find and train someone would take more time than you have! So you keep working harder, until you break.

Here's my little tale of how I broke into the delegation mindset:

In 2001, CD Baby was three years old. I had eight employees but I was still doing “everything else†myself. Working 7am to 10pm, seven days a week, everything still went through me.

Every five minutes, my employees had a question for me:

“Derek, some guy wants to change the album art after it's already live on the site. What do I tell him?â€
“Derek, can we accept wire transfer as a form of payment?â€
“Derek, someone placed two orders today, and wants to know if we can ship them together as one, but refund him the shipping cost savings?â€
It was hard to get anything done while answering questions all day. I felt like I might as well just show up to work and sit on a chair in the hallway, just answering employees' questions, full-time.

I hit my breaking point. I stopped going to the office and shut off my phone. Then I realized I was running from my problems instead of solving them. I had to fix this, or I'd be ruined.

After a long introspective night of thinking and writing, I got myself into the delegation mindset.

I had to make myself un-necessary to the running of my company.

The next day, as soon as I walked in the door, someone asked, “Derek, someone whose CDs we received yesterday has now changed his mind and wants his CDs shipped back. We've already done the work, but he's asking if we can refund his set-up fee since he was never live on the site.â€

This time, instead of just answering the question, I called everyone together for a minute.

I repeated the situation and the question for everyone.

I answered the question, but more importantly, I explained the thought process and philosophy behind my answer.

“Yes refund his money in full. We'll take a little loss. It's important to always do whatever would make the customer happiest, as long as it's not outrageous. A little gesture like this goes a long way to him telling his friends we're a great company. Everyone always remember that helping musicians is our first goal, and profit is second. You have my full permission to use that guideline to make these decisions yourself in the future. Do what makes them happiest. Make sure everyone who deals with us leaves with a smile.â€

I asked around to make sure everyone understood the answer.

I asked one person to start a manual, and write down the answer to this one situation, and write down the philosophy behind it.

Then everyone went back to work.

Ten minutes later, new question. Same process:

Gather everybody around.
Answer the question, and explain the philosophy.
Make sure everyone understands the thought process.
Ask one person to write it in the manual.
Let them know they can decide this without me next time.
After two months of this, there were no more questions.

Then I showed someone how to do the last of the stuff that was still my job. As part of learning it, they had to document it in the manual, and show it to someone else, too. (Learn by teaching.)

Now I was totally un-necessary.

I started working at home - not going into the office at all.

I had even taught them my thought-process and philosophy about hiring new people. So our two newest employees were entirely found, interviewed, hired, and trained by them. They used that manual to make sure every new employee understood the philosophy and history, and knew how to make decisions for themselves.

I'd call in once a week to make sure everything was OK. It was. They didn't even have any questions for me.

Because my team was running the business, I was free to actually improve the business!

I moved to California, just to make it clear that the running of things was up to them.

I was still working 12-hour days, but now I was spending all my time on improvements, optimizations and innovations. To me, this was the fun stuff. This was play, not work.

While I was away, my company grew from $1M to $20M in four years.

There's a big difference between being self-employed and being a business owner.

Being self-employed feels like freedom until you realize that if you take time off, your business crumbles.

To be a true business owner, make sure you could leave for a year, and when you came back, your business would be doing better than when you left.

 

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[darkjediii]

Nice link and story!

 

[Autonomust]

Story of the month right here.

For the longest Iv'e always thought to myself that some entrepreneurs work too much and what I mean by that is they do too many things at once and don't realize that they can outsource some of the work so that they can focus on building the business more instead of doing the same menial tasks over and over again so that they will not be in the same spot constantly.

 

[V8Bill]

From his blog...

•I’m a minimalist. The less I own, the happier I am.

 

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[Motivated]

Works well in theory, but you absolutely must have the best employees for the job.

 

[Brander]

Works well in theory, but you absolutely must have the best employees for the job.

I wouldn't agree you need the best, just the ones who will care enough (as they usually see the job through). Most people don't care and that is why the work is sloppy.

But "outsourcing" works great in theory less so in practice as just stated. Sivers is not taking about outsourcing, of course, but delegation. The most important thing there is that everyone knows the company culture and why you do what you do.

My own experience in terms of employing coders and support staff is that it was imperative that I do myself first what I later demanded of them. First I knew what I was doing and no one could fake by and second I wasn't (and still am not) dependent on anyone (control). Everyone was and is expendable immediately without any loss of productivity (If I don't find a suitable replacement soon for a coder I re-assign other coders to fill-in temporarily or I jump in personally).

I prefer my staff to be in the office so they can be infused with why I do what I do and how I do it - decisions are made by them for anything below a certain amount or below core features importance.

If someone is exceptionally talented and needs a bit more leeway by working from home, I make sure to have short video talks with all the crew once a week or so and that he or she is within no more than an hour and a half drive from me. It's just personal preference after years of trial and error.

I think James F can also say something about this topic...

 

[Pinnacle]

But what if some of those employees leave the company or they call in sick for a week? The knowledge of how to run the business is locked in their heads. If the knowledge was documented somewhere, the ball game would be different.

The article touches on great points, but one of the most effective ways to delegate is to systematize the training process for employees. Create training videos, flowcharts, tutorials with screenshots, etc. for all the processess, procedures, and controls that make up your business' infrastructure. That way, you avoid the need for meetings, anyone can be trained at anytime, and you can authorize key people to even make changes to the business systems as needed. Sivers is on the right track, but it can be taken a massive step further to the point where spending 12 hours days on improvements and optimization won't even be necessary.

 

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[ZCP]

You guys are missing the point. Operations manual = systems = scalability.

Best thing we have done is put our manual together and begin teaching how to improve it.