What if you were to die tonight? Would you company cease to exist tomorrow? If so, then it's obvious that all of the client relationships with key clients rests with you. This exclusive dependance on YOU can have a devastating impact on your brand. Since YOU are the brand - it all rides on your staying around forever.
All of your stakeholders rely on you and your exclusive relationships. As much as it gets you the billings you need to grow the brand, it is a ticking time-bomb. Maybe your long-term plan is to sell the company at some point and bow out. But what you may not have predicted is the fact that since clients rely on YOU, can you be so sure that they will accept being "sold" to another party. Chances are greater that they will walk. I have a colleague who had exactly this happen to them. It immediately killed their succession plans. It was a rude awakening. When they did sell, it was for "substantially" less, because the book of business was not assured.
All of your employees, suppliers and dependents will suffer needlessly unless you act now to bring on a lieutenant and instill the values and work ethics than each client has grown to love in you. Your brand needs another YOU to succeed long after you've departed.
3 comments:
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Ed, I have talked a lot about this problem on my blog. I work with a lot of people that are, in fact, the business and haven't considered hiring anyone else.
I suggest that people in these situations, especially if they want to grow their business substantially, hire a key employee. Not only does it help in succession planning, it takes some of the pressure for success of the business off of the owner. Many business owners find that without a key employee they stop generating income unless they are actually working. What about vacations or unforseen problems. I hadn't even related it to more long-term strategies such as succession.
I think you are dead on. Small business owners definitely need to consider having a key employee. The benefits are innumerable.
Brandi,
I would say what is just as important is to have a documented system in place. This prevents the eventual standoff that a "key employee" may eventually have with management.
I remember one key guy I worked with was asked by management to not ride his motorcycle because he was the only one that knew how certain code worked. Can you imagine being told you can no longer have fun just because you are the key guy/gal?
Btw, I do not think a brand that is independent of the originator is not always possible. Think Apple (what comes to mind?). Same with Microsoft, Ford, etc.
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