Do you hope to take a vacation some day and not worry if your business will still be there when you return? Then you need to set up for what I call business self-sustainability or what is referred to as an absentee owner business.
If you’ve read any of our past materials you are probably familiar with the term business self-sustainability which we use often. If you have not, then you may want to click the previous link and read some of these previous post. A simple overview of the concept of an absentee owner business is to put the people and systems in place so that the business can operate without you being there.
Most business owners think they have to grow the business to $5 or $10 million to get there, but you don’t. I showed in the previous post titled How Big Do You Need to Grow Your Business For Self-Sustainability? how to calculate exactly how much you need to grow to get there.
Ok, now you know that you want an absentee owner business how do you get there? It’s simpler than you might think…
Stop Being a Business Worker and Learn How to Own an Absentee Owner Business
As a business owner you need to focus more on thinking about strategic objectives necessary to drive your business in the right direction – business self-sustainability. At the same time you need reduce the time that you spend worrying and doing day-to-day tasks to bring sales and revenue in the door.
You’ve all heard the cliché “stop working in your business, and start working on your business.” Building an absentee owner business is exactly the meaning of this statement. Problem is many small business owners don’t know what they need to do to work “on the business.”
3 Skills of Creating an Absentee Owner Business
To create an absentee owner business you need to learn how to do three things:
- Understand what factors drive your business and how to measure them.
- Create systems that use these measures to create consistent predictability in your revenue and profitability.
- Learn how to delegate and push responsibility and control to others.
Sounds easy enough – right?! Well it would be if you haven’t already developed some bad habits. Most of these habits are keeping you away from having an absentee owner business!
The most difficult part isn’t learning these new skills. It’s unlearning the bad habits you may have created along the way.
Understanding what factors drive your business and how to measure them
This is just learning how to systematically manage your business. We created our management model for tuning your revenue engine as a method to more easily learn how to predictively manage your business. By understanding the cause and effect within your business you can understand what will most likely happen with certain decisions which guides you to make better decisions.
Creating systems to create consistent predictability in your revenue and profits
I talk about systems all the time. Systems are nothing more than documenting what you’re doing (procedures). Then making sure that everyone is following those procedures when they accomplish those tasks within the business. Read the post 5 Steps to Establishing a Repeatable and Sustainable Business to find out more on this topic.
It’s the second part of this process where many business owner struggle most. How to get people to follow the procedures! This means creating performance-based accountability for everyone in the business. Then following through with regular reviews and evaluation. Here is a good post to show you how to create accountability in your business.
Learning how to delegate and push responsibility and control to others
Most people have a difficult time delegating for 2 reasons. The first one is easy to solve, in fact we already solved it with the previous 2 steps. You have created metrics to monitor performance of the business. Then you created systems that put the performance into action. Now you can easily delegate work and know that you will get the results you want.
The second reason delegating becomes a challenge is mental.
Making a Mental Shift in Your Absentee Owner Business
Owners often struggle with giving up control of their business. They are too emotionally attached to it. Believe me, I get it. You put a lot of hard effort, blood, sweat, and tears to get it here!
However, to get it where you really want (absentee owner business) you have to change the way you think about your business!
This is why the first step of our BGS Growth Framework helps you define your passion. You are more likely to change if you understand what you really want out of life. Then you can better look at how to use your business as a vehicle to get you there. If you think of your business as a vehicle to achieve your ultimate desires, then it will be much easier to let go! Our personal and business goal assessment can help you get better clarity here if you’re struggling to figure out your WHY!
So, there you have it. If you want an absentee owner business you need to become a better owner. That means:
- Understanding your metrics
- Create systems to scale your business
- Learn how to delegate to build a team.
Which of these items do you find most difficult? Share your story of successes and failure so that others can benefit from you knowledge!