The traditional way to build a business is to build an owner-reliant business.
You, the business owner, gather up the reins of power -- you manage the key activities of the company, you make all the key decisions (or at least review them), you create the plan, and you lead the execution of that plan.
Sure, you have people to help, but they're there to do just that--help--not to lead or take ownership of central parts of your business.
The core knowledge of how to manage and direct it is locked up in the gray matter of your brain. If something should happen to you, your business would crumble.
If you manage to somehow escape for a short vacation, you probably sneak your laptop or iPhone® with you on the trip and check email when your spouse and kids aren't looking.
What's the real reason driver for the typical business owner to build an owner-reliant company? They fear "losing control", scared that if they don't stay in control, things will go wrong. They're afraid that their staff will screw up and they'll lose a customer or face a lawsuit, or even that the company will fail. So they clutch at the security blanket of control, never seeing that it binds them in a trap that holds them in their businesses forever.
Remember the scene in Godfather III in which Michael Corleone (played by Al Pacino) wants to get out of the family business? He turns to his sister Connie and says, "Just when I thought I was out, they pull me back in!" Well, that's exactly how many owner-reliant business owners feel.
While there is nothing wrong with this traditional model, and it works to build a successful small business, it leads to three serious pitfalls.
Pitfall 1: It caps your income and your success.
If your business revolves around you and your personal production, as you become more successful, you'll smack up against the ceiling of how much you personally are able to produce for your business.
You can personally only do so much and run so fast before you just can't do any more.
Pitfall 2: It puts everyone at greater risk.
If you stop working or get injured, your business dies--quickly. This is risky for you, your family, your employees, your customers, and your investors.
If you should ever get hit by the proverbial "bus", your business will likely fold in less than 30-90 days.
Pitfall 3: It eventually corners you in the Self-Employment Trap--the more success you have, the more trapped you become inside your business.
You're so busy doing the "job" of your business that you can't step back and focus on growing your business.
As you grow your sales by personally producing more, you take on increasingly more overhead. That means each month, your starting point requires you to run even faster just to cover your fixed costs. It traps you firmly inside the suffocating blanket of your owner-reliant business.
So what's the way out of the Self-Employment Trap?
In the traditional approach, you try to escape by personally working harder. But that's like stepping on a treadmill and saying that the way to get off is to simply run faster. Not so. The faster you run, the faster the speed of the treadmill. You take on more overhead and hire more employees, but you put them into an owner-reliant model that merely increases your personal pressure to produce. And what happens if you ever stop running? You come crashing off the treadmill and your business dies.
Instead you've got to work to wean your business off of its crippling reliance on you. This means incrementally replacing yourself from more and more of what you do for your company, filling these responsibilities with the solid core of systems, team, and internal controls. This is something I've written extensively elsewhere about (just search on the list of other articles I've posted here for a real flavor, or get a copy of our free tool kit to grow your company which includes 21 in-depth video trainings to help you scale your business and get your life back, click here.
Our 2024 Coverage Needs You
It's Another Trump-Biden Showdown — And We Need Your Help
The Future Of Democracy Is At Stake
Our 2024 Coverage Needs You
Your Loyalty Means The World To Us
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
The 2024 election is heating up, and women's rights, health care, voting rights, and the very future of democracy are all at stake. Donald Trump will face Joe Biden in the most consequential vote of our time. And HuffPost will be there, covering every twist and turn. America's future hangs in the balance. Would you consider contributing to support our journalism and keep it free for all during this critical season?
HuffPost believes news should be accessible to everyone, regardless of their ability to pay for it. We rely on readers like you to help fund our work. Any contribution you can make — even as little as $2 — goes directly toward supporting the impactful journalism that we will continue to produce this year. Thank you for being part of our story.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
It's official: Donald Trump will face Joe Biden this fall in the presidential election. As we face the most consequential presidential election of our time, HuffPost is committed to bringing you up-to-date, accurate news about the 2024 race. While other outlets have retreated behind paywalls, you can trust our news will stay free.
But we can't do it without your help. Reader funding is one of the key ways we support our newsroom. Would you consider making a donation to help fund our news during this critical time? Your contributions are vital to supporting a free press.
Contribute as little as $2 to keep our journalism free and accessible to all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
As Americans head to the polls in 2024, the very future of our country is at stake. At HuffPost, we believe that a free press is critical to creating well-informed voters. That's why our journalism is free for everyone, even though other newsrooms retreat behind expensive paywalls.
Our journalists will continue to cover the twists and turns during this historic presidential election. With your help, we'll bring you hard-hitting investigations, well-researched analysis and timely takes you can't find elsewhere. Reporting in this current political climate is a responsibility we do not take lightly, and we thank you for your support.
Contribute as little as $2 to keep our news free for all.
Can't afford to donate? Support HuffPost by creating a free account and log in while you read.
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. Would you consider becoming a regular HuffPost contributor?
Dear HuffPost Reader
Thank you for your past contribution to HuffPost. We are sincerely grateful for readers like you who help us ensure that we can keep our journalism free for everyone.
The stakes are high this year, and our 2024 coverage could use continued support. If circumstances have changed since you last contributed, we hope you'll consider contributing to HuffPost once more.
Support HuffPostAlready contributed? Log in to hide these messages.