The Number One Problem for 75% of the Businesses in America
You’ve heard of “Mom & Pop Shops”. It is a name given to a small family-owned business. Ones where Mom or Pop are both the chief cook and bottle washer. They might be running a restaurant, a local grocery store, or an auto repair shop. But they could just as easily be running an IT business, a medical clinic, or a construction company.
These businesses are dependent on Mom or Pop. Dependent on their knowledge, their financial credit, their willingness to do what it takes, their relationships, and so on.
Mom & Pop shops make up the vast majority of businesses in the United States. In fact, most business leaders run their businesses like Mom and Pop. “Mom” or “Pop” may have a fancier title, like “President & CEO” or “Managing Partner” or “Principle.” They might generate millions or even tens of millions of dollars. They might even be highly profitable. From the outside, they could look great.
But, they are built and balanced on the owner, the founder, a strong leader, or a small partnership team. They are dependent on a single (or very small group) of leaders.
These organizations provide autonomy for the owner. At least from having to answer to an employer.
But they rarely provide meaningful freedom. The owners often depend on the business for their income — but the business can’t run well without them.
The owner or the leader is often trapped. They can’t go anywhere — without fear of everything falling apart or shutting down. They don’t really own a business. They do own their job.
This is the number one reason why only about 20% of all businesses ever find buyers. Because without Mom & Pop, or their equivalent, they aren’t worth anything.
Dependency on the leader:
- Caps growth: The organization can’t grow beyond what the leader can personally take care of.
- Reduces organizational resiliency: The leader has become a single point of failure for the organization.
- Builds a culture of dependency: The leader often doesn’t train and may actively discourage a culture and team of decision-makers and leaders.
- Creates organizations that:
- Ultimately cannot sell
2. Struggle and often fail during succession
The most common reasons for this dependency:
- Lack of Systems and Structure: Many leaders are great entrepreneurs, rain-makers, or technical experts. They haven’t taken the time or don’t know how to transfer what they do naturally or informally into a replicable, understandable system anyone can follow.
- Lack of Trust: They don’t trust others. “No one else cares as much as I do.” “No one else will provide the quality that I do.” “I’ve been taken advantage of before.” That’s likely all true. And most of these objections can be answered with strong systems of accountability.
- Need to be needed: Many leaders, even owners, will tell me, “People will think that I’m not pulling my weight if I’m not doing X, Y, and Z.” And in some cases, the leader has a need to be the smartest person in the room, the hero, or the fixer.
What to do if this is you:
I find this observation challenging: Always remember that there is someone less competent, intelligent, and driven than yourself who is accomplishing more.
What’s different about those people?
- They are often more than willing to receive help.
- They build or oversee the building of systems.
- They learn to trust others (good systems make that easier).
- Their identity is less closely tied to their business or what they do.
If you feel like you can’t escape your business, perhaps even like you are your own worst boss, you aren’t alone.
But it doesn’t have to stay that way. Find and get help. Take the time to build systems and structures that allow the business to run without you. Learn to trust others. Cultivate a sense of self that is more robust than the service you offer.
The Path to Freedom
All of the above is easier to say than do for most. I get that. But it is also the path to freedom. The good news about this path to freedom is that it is accessible to most owners and business leaders.
I walk people down this path all of the time. They usually discover the biggest obstacles were mindsets — not the economy, not the difficulty finding good (or any) employees, or being too busy. And mindsets are entirely within your control.
The rewards? Discretionary time. Time with family and time for healthy activities. Increased peace. Often, also, there are increased revenues and profits. Businesses grow and take less work to run. Can you imagine that?
I don’t have to. My clients experience this on a regular basis.
If you’d like freedom in your business — get help. If you are ready to start but don’t know who to reach out to — give me a call or send me an email.
Take good care,
Originally published at https://www.christianmuntean.com on July 19, 2022.