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4 signs your organization is too dependent on its leaders

If all the decision-making power and responsibility rests in your hands, it’s time to reevaluate your business operations.

4 signs your organization is too dependent on its leaders
[Photo: Leong Thian Fu / EyeEm/Getty Images]

As a business leader, sometimes you have no choice but to be the lifeblood of business operations, but it shouldn’t become a habit. You can be involved in the high-level aspects of managing a business while knowing when to get out of the weeds as a leader. Otherwise, you’ll only hinder your chances of scaling the business beyond your efforts.

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What’s wrong with being your company’s lifeblood, heartbeat, and brain? For one, your business won’t be able to exist without you, which will create challenges when it’s time for you to transition out. Potential buyers won’t be interested in acquiring a company that depends on a single individual for its survival, and employees will be less likely to remain loyal in the long run.

Being too involved in every aspect of your business operations management processes also limits your organization’s ability to run efficiently. It’s hard to optimize processes when they all funnel toward the same source, and feeling like every decision rests on your shoulders will only lead to burnout. Taking a step back and allowing your team or direct reports to take on some of those responsibilities will ultimately allow your organization to run more effectively while also taking some of that weight off your shoulders.

If you decide to step away from being the lifeblood of your business, you’ll also be able to visualize your system more objectively. You may find out you no longer need to work over 50 hours a week. You’ll also be more engaged as you effectively run a business, where both executives and employees foster a company culture of innovation and teamwork. To find out if you’re too intertwined with the workings of your business, look for the following red flags in your current business operations.

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1. Everything requires your sign-off

You’re a bottleneck to productivity if you require a sign-off on everything from invoices to paychecks before it goes out. Although this can be manageable and understandable from a quality assurance standpoint when you’re operating a boutique practice, it only burdens the business when you start to grow. Lee Iacocca, the former Chrysler executive, used to explain that he hired people who were smarter than him and then got out of their way. If your work structure turns you into a veritable babysitter, you’re undermining your employees’ morale and your company’s growth potential.

Start by reevaluating all the chains of command that lead straight to your desk. Your organization will run more efficiently when management doesn’t make a habit of being a business bottleneck. Allow employees the space and means to perform their duties unhindered to optimize processes and keep tasks from piling up on your desk. When you allow your employees the room to make big-picture decisions, you create an organization that is effective and desirable for not only future employees but also potential buyers.

2. Operations fall apart when you walk away

Does the thought of taking even a three-day weekend make you wince? It’s time for a different approach. You should have the option to go away for a few weeks without worry, but don’t feel bad if you can’t. Most owner-led organizations leave all major decisions to the founder. The solution to this problem is to regularly deputize your leadership team to take ownership of specific responsibilities that you would normally handle.

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Additionally, you should start creating standard operating procedures and similar documents for processes across the entire organization. Your goal should be that any employee, whether working for years or months, could understand and use your specific systems right off the bat. After all, potential buyers will not give your organization a second glance if you are the only source of documentation. Over time, you’ll find it easier to trust your team and documented processes—and ultimately take that three-day weekend.

3. You have no succession plan

A UBS survey shows that 48% of owners haven’t mapped out their succession plans. Yet research from The Exit Planning Institute shows that 75% of owners want to transition out of their businesses within 10 years. These figures show a serious disconnect. Without a founder CEO succession strategy, your company could crumble the moment you leave. After scaling your dream, you don’t want to see that occur. Instead, talk to an adviser about succession planning. Find out how to step down from a leadership position in the most practical, prudent, and profitable way.

Not only will your company have a better chance of succeeding without you at the helm, but your employees will also feel a heightened sense of job security. By taking a more elevated view of your business, you’ll be able to enjoy the benefits of objectivity. As a leader, you should be running a business, not working a job. Planning for succession ahead of time will help you reach that goal.

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4. The business has no diffusion of responsibility

From sales to marketing, you drive it all. Your personality and sheer energy keep clients coming back. In fact, you insert yourself into all significant sales calls and marketing meetings. However, since you’re so enmeshed in the smallest details, you end up hurting your corporate revenue stream. Sure, you can bring in clients, but every hour you spend playing the role of dealmaker or quality control specialist steals time away from other tasks that only the CEO can do.

Ultimately, these constant sources of stress will burn you out and put your business’s success at risk. Instead, work on creating dependable and decentralized systems that harness the collective intelligence of your employees and team members. Allowing your employees to hone their talents and build confidence will allow your business to scale and remain successful even after you move on to other ventures.

Think you might be the lifeblood of your company? The good news is you can start reversing course right away. When you do, you might just be amazed at how much of an improvement it makes on your company’s culture, operations, and bottom line.

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Jeff Meade is the founder and CEO of MEADE, a management consulting firm.

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