The Stages of a Business
In our work over the years, we have outlined three general stages that a small business will go through as it grows. They are the Technician, Owner and CEO phases. While each of these phases can be broken down into further segments, we will focus on these three overarching stages in this article.
When speaking with Shannon Miles, CEO and Co-Founder of Belay Solutions, we discussed her and Bryan's (husband) journey through these stages. They experienced a three year start up phase. At that point, they had to make some changes in their mental approach to get into the Owner stage. Now they are clearly in the CEO stage. Listen to the episode to learn more.
While these stages exist and are clearly defined on paper, they may actually blend into each other. There is a definite difference in the skills needed in each stage as well as the mental approach. It will be important to learn, hire and/or develop the skills needed first for you as a leader and then for the team.
This is the the start up. When you hear a business owner say they wear many hats, this is the phase they are talking about. During the start up phase the owner is usually adept at the technical side of the business and is very involved in the 'hands on' aspects of the business. Many times the technical aptitude is exactly why they decide to start their own business.
If you are doing the actual work for the customer, then you are in the technician phase. We hear the common refrain from business owners in this phase, "I am working 60 to 70 hours a week and can't get seem to find any extra time." This is because in the start up finances are slim and hiring a large team doesn't even seem possible. You may even have a small team, but your are still working long hours.
Unless you have the availability of large amounts of capital at start up, you will likely need to work hard, long hours at the beginning. You will have to get hands on and do direct work. That is expected. However, you must make a mental shift to being an owner and work on the business and not for the business. While you may own the business, without transitioning to the Owner Phase, you have basically created a self-employed job.
While transitioning to the Owner Phase, focus on marketing and sales in the technician phase. You need to build a sales pipeline so it can help to propel your business into a growth stage that makes the next two stages easier to transition into. Without increased revenues, you will find it difficult to make it to the Owner Phase.
The Owner phase is where you work on the business processes and people. This may seem counterintuitive, however it is imperative. The operations of the business are what are key to master in this phase. In the discussion with Shannon, she mentioned the advice given to her husband, Bryan, by his friend Jeff. Jeff said, "The day the business doesn't need you, then you own it." Building systems and processes, along with the right team members, is exactly what he was talking about.
You have to begin building a core team that you can delegate to in the Owner Phase. You cannot be effective and grow without the right people. The people need to have the right attitude and character first and foremost. Then they either need to bring the skills with them or they need to be developed. They also must support the values of the organization.
The people on your team will help you create and master the business processes. As the systems of your business are built you will find you, as the owner, will have more time freedom and energy to dedicate to owner responsibilities, while the team does the day to day work.
The owner responsibilities in this phase revolve around building the best business possible. Areas such as delegation, hiring, sales, marketing and operations needs the owner to work on them proactively and intentionally. It will also be imperative to spend quality time growing and developing the team. This is one of the most important activities for the owner as they prepare to move into the CEO Phase.
The CEO phase begins after the people and processes have been put into place and the Owner can step away, yet the business continues to perform. The key focus in this phase is strategy and leadership. With the structure built in the Owner Phase and the added leadership focus, combined with a clear strategy, business scale is possible.
As the CEO, the owner is not running the day to day, but setting strategy and looking into the future. The owner is also developing the leaders the business needs to continue to grow and scale. This is the critical and often missed key to this phase.
When a business reaches this phase, the focus on team and culture are paramount. The culture of the business is how the customers will be treated after all. To maintain the A players the owner brought on board, a healthy culture is a priority.
There are many businesses that make it to the transition point into the CEO Phase and either fail or shrink back to the Owner Phase. This is because they either didn't have the structure (systems and processes) in place as it should be or they haven't spent the energy they need to to develop the people, especially the owner.
The greatest impediment we have seen is the lack of leadership skills from the owner. Sometimes it is because they haven't realized their bind spots or have resisted changing. Regardless, the owner must realize the business cannot and will not grow beyond your leadership ability.
In our conversation, Shannon was very clear how she sought to become a better leader. She reads books, attends seminars and continuously learns in multiple ways. She and Bryan not only grew into the owners they should be, but they are mastering the CEO Phase as well.
Shannon even talks about the lingering feeling of being inadequate to run such a growing company. The hunger to learn and grow herself is paralleled by the growth of their company. With 750 team members and growing, they are doing the key strategic and leadership activities required to be successful.
"The functions of the job are secondary to the leaders health and ability to lead through despite challenges, insecurities and frustrations." - Shannon Miles
Another key point in our conversation was what name they call their contractors and employees. They call them Team Members. This is intentional. This is the mark of a leader thinking through a detail that impacts culture. It is important to the people that work with Belay. They want to all feel a part of the same team.
Shannon also mentions that the key to growth was the focus on intentionally developing leaders. As we spoke about in the CEO Phase, this is one of the key responsibilities of the owner. Without building a leadership pipeline, the business will be constrained. With a leadership pipeline, their is no limit to growth.
One parting piece of advice to the business owner, find time to be introspective. Spend time working on you, whether leadership skills, mindset or health. The business is so dependent on your ability to lead it with energy and a clear mind. You need to give it your best.
You must build this into your schedule. Saying you will do it isn't enough. You must plan, schedule and communicate it to your team. This is a priority for you. Go make it happen. It will pay dividends to you and your business. You must be the model of self care to your team.
Enjoy the Journey!
I thank Shannon for her time and wisdom. If you are looking to grow your team and are considering VA's as part of a solution, reach out to Belay Solutions. They know exactly what you need and where you are headed. They've been there too!
Books mentioned by Shannon Miles:
The Road Back to You by Cron and Stabile
The Founder's Mentality by Zook and Allen
The Gifts of Imperfection by Brene Brown
Shannon's book - The Third Option
If we can help you in any way on your journey from Technician to Owner or from Owner to CEO, reach out to us at www.BusinessOwnerFreedom.com or www.GregoryGray.com. We have several ways to work on your business and your leadership transformation, including coaching, masterminds and programs.
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