In today’s business environment, leaders are encouraged to speak in a transparent, honest way to their employees, customers, partners, suppliers, shareholders and any other party that may be somehow connected to their organization. Some even take the opportunity to speak of their failures just as readily they discuss their successes. From Facebook executive Sheryl Sandberg to blog-savvy entrepreneurs, CEOs have found new and ever-more intimate ways to remind the rest of us that they’re human, too.
Sometimes their openness reveals deep-seated challenges within their organizations.
Case in point: Tesla CEO Elon Musk’s recent sit-down with the New York Times, in which he detailed the personal turmoil he’s experienced over the past year. Part of that difficulty stemmed from production delays in getting the electric car company’s new Model 3—not to mention its other, hugely popular, yet expensive models—off the assembly line and into customers’ hands. Musk described entire weeks spent sleeping at the factory, nearly missing his brother’s wedding and, generally, having a toppling pile of responsibility mount on his increasingly-strained shoulders.
A common entrepreneurial challenge
Sound familiar? You’ve probably had similar thoughts when reflecting on the challenges of running your own company, but without the high-profile venue of the Times to share your emotions. Indeed, choking back tears, Musk revealed that he was near his breaking point. He could also see potential legal challenges in the future after tweeting his plans to take the publicly-traded Tesla private—since rescinded—that took unsuspecting investors, not to mention the entire auto industry, by surprise.
The interview highlighted a lesson that every entrepreneur should heed: it’s absolutely critical to delegate senior management responsibilities once a business enters a major growth phase, or scales past the point where a single owner-manager can no longer effectively manage its continued growth.
That’s usually easier said than done. Many business owners liken their businesses to family (hence the old ‘my business is my baby’ adage) and take full (e.g., too much) responsibility for their management. This works only to a point. At some stage, even the most competent and experienced manager must find others to whom they can offload work. Balancing multiple companies and a plethora of headaches at Tesla, it seems as though Musk was loath to fully embrace this advice, even though the company does have a fully-staffed senior leadership group.
Hire managers with different skills
The reality is that your business depends on having a strong management team with different specialties. Having an experienced chief financial officer, a head of operations and other C-suite positions filled with the right people could mean the difference between the success and failure of your business. Can’t support those hefty salaries? We often encourage our clients to seek out high-level help on a part-time basis. Many senior executives at or nearing retirement don’t necessarily want to fully retire, but would still enjoy consulting for a growth-focused company that can leverage their expertise to remain on that trajectory.
CEO burnout, as evidenced by Musk, is a problem that can plague even the most steadfast executive. An excessive workload forcing some business owners to walk away from their companies altogether is not unheard of—we’ve seen it happen. This heartbreaking outcome is entirely avoidable with the right planning. Beyond considering part-time C-suite help, we encourage business owners to monitor growth trends. If you’ve just signed several new clients with considerable deliverable expectations, think six months ahead and consider who will manage that output. If those responsibilities fall entirely to you, it’s time to consider bringing on extra help now, even if it negatively impacts your bottom-line in the short term.
Delegating requires ample financing
That brings us to financial considerations. Many CEOs are reluctant to call in the managerial cavalry because the immediate expenditures risk compromising cash flow. That’s why it’s so important to have sources of financing such as loans or open lines of credit on tap to prevent making potentially deleterious financial decisions with disastrous long-term implications.
The last point to consider—and one that we see affecting CEOs on a regular basis—is stubbornness. They think they can do it all, and better, than anyone else, and are determined to prove the point. Hubris on the part of otherwise rational, dedicated and capable entrepreneurs has brought countless to heel. Our message is simple: take your own ego out of the business and realize that its ongoing success depends on making smart managerial decisions that allow you to focus on working on the business, rather than in it.
Delegating work is also your ticket to managing some sort of work-life balance as you continue to grow your company. Take it from Elon Musk. Shouldering the burden of managing a rapidly-expanding company only invites unwanted problems. Putting your faith in others to run the business is daunting at first, but it’s only once you have the right managers in place that your company can thrive.
Marshall Egelnick, Managing Partner