You Down With DLC?

by | May 8, 2024 | Uncategorized

“The idea is not to live forever, but to create something that will.” – Andy Warhol

In 2017, we opened the doors of Revolution Engineering with bright eyes, bushy tails, and five employees. For a while, we operated from my kitchen table. We quickly realized (as the vacuum was running or the pig was oinking) that we needed to move to an actual office.

Prior to that, in 2011, I opened an office with two employees: my wife and me. I was responsible for design, drafting, review, stamping, signing, printing, accounting, invoicing, client meetings, business development, marketing, proposal writing….you get the picture. My wife was responsible for party planning and helping me maintain my sanity by keeping everything else in order in our world. For that, I am eternally grateful.

While my sole proprietor business was fun and exciting, it wasn’t built well for growth. While doing the work, I missed out on business development opportunities. While doing business development, I couldn’t invoice people to get paid. And while I was invoicing, I wasn’t working on projects. It was a vicious cycle that created long hours and many lonely nights at my computer.

In hindsight, my #1 employee should have been an administrative assistant. Even if that person were part-time, it would have been a game changer at the time.

Fast forward to 2017, the creation of Revolution Engineering and four other people joined me from the start. Those people were:

  1. Mechanical Engineer
  2. Mechanical Designer
  3. Electrical Designer
  4. Administrative Assistant

I am an Electrical Engineer, so we didn’t need someone to fill that position. We then hired a third-party bookkeeper to invoice and perform general accounting. My wife also did some business development (aka The Beer Fairie) and became our “Director of Shenanigans,” still planning parties and maintaining order in the rest of my world. Again, I am eternally grateful. I don’t count her as one of the original five because she wasn’t paid at the time (but she did have the best benefit package!).

We quickly realized a sixth person was needed: a highly skilled plumbing designer. That person was added within three months, and we were off to the races. While we had ups and downs, we never missed payroll and always pushed for growth.

Here is my very long-winded point: growing your business can be challenging if you don’t have the right people in the right position. In order for me to grow from 5-6, 6-12, and now 12-17 and beyond, I needed to find people to do the things I couldn’t do successfully. You have to be down with DLC – Delegate, Lead, Create

To grow my business, I needed to look at two things: 1) what my highest and best use was and 2) what I could delegate to others. Those two questions are the start of growth. To grow, you must delegate and lead. Once you can delegate and lead, you can create. Create new work, create new leads, create new content. Whatever you want to create to drive your business to more growth. Let’s break down the entire process.

Delegate

The first step in delegation is determining what doesn’t fall into your highest and best use. Using the example of my single-person firm from 2011, my “highest and best use” was project management, project design, and business development. I shouldn’t have been doing invoicing, response letters, contract writing, and other general administrative duties. Since I was a small firm and couldn’t afford a full-time person, I could hire a virtual assistant or part-time person to do those tasks. Realize that the person I hire to do those tasks should be good at those tasks. It doesn’t do any good for me to hire another engineer to do invoicing and admin duties. “Administration” should be the person’s highest and best use.

Fast forward to my 2017 firm, and notice that an administrative assistant was one of the five people I hired from day 1. She wasn’t good at invoicing and bookkeeping, so we outsourced that to a third-party bookkeeper. Now, I had the time to do what I did best (business development, engineering, and project management) while those people did what they did best (administration and bookkeeping).

A good rule of thumb for delegation is the 95/5 rule. Find the 5% of your work that is your “highest and best use,” then delegate the other 95%. What is the 5% of the work you do to bring in 80% of your business? Continually evaluate your 5% to narrow it down further and further, finding the person or people who can do the other 95% for you.

Using the 2017 example again, my next hire might be an electrical designer. My workload has now shifted from business development, engineering and designing plans, project management, and minor assistance with the admin team when they need help to business development, project management, and occasionally helping the designer and admin team. You can see how I can continue to hone this process to focus on what brings in the most business for our firm: business development with our best clients.

Here’s a quick synopsis of the process:

  • Delegate what doesn’t fall under your highest and best use. Find the people to do the things you can’t and lead them properly. Hire for the things you aren’t good at.
    • Accounting
    • Marketing
    • Design
    • HR
    • Social media
  • Find and hire help by paying, giving equity, or other means (third-party services) to bring in the right people.
  • Delegate 95% and focus on the 5% that is your best use.
  • Continue to evaluate your 5% for more 95% projects that can be delegated to others.

Lead

As you start to hire the best and brightest people to take your 95%, you will have to lead them properly so they know what you expect from them. The first step is to have a set of values for your business. These values will be the stepping stones for success with your team.

Value promptness? Maybe your value is “100% on-time delivery of all products.” Or “We respond to all emails and inquiries within 24 hours.” The point is that they are your values; you get to decide what they are. You can certainly use your team’s ideas, but the ultimate decision is yours as the owner.

The next critical step is to set expectations for your team, using the company values as the guiding system and holding them accountable for their expectations. What are the repercussions if the team knows you expect a 24-hour response time, and the response comes in 25 hours? Being clear about the result will set the team up for success.

Finally, ensure your values and expectations are spelled out clearly in your systems. A system is written or in some way available to all people on your team without asking you for the information. A system is not “in your head.” It must be written or in a video or some other way that anyone can access anytime without your presence.

Your most important processes must be documented. If you don’t know where to start, ask the person running the process. Have them document the critical steps of the process. Again, this can be written in an outline, done on a webcam, or with keystroke recording software on a computer. There are several resources for recording the process as a person performs the task that doesn’t require them to be seen on the video (for your camera-shy folks).

Once the values, expectations, and systems are clear and understood, you can lead these people to success. When you hire other people to their team so they can focus on their 5% and delegate the 95%, you have developed leaders who can lead a team. You lead your leaders, leaders lead the teams, teams lead the systems.

To recap:

  • Develop values for your company. Use your personal values as a baseline, or ask your team what they think the values should be. Ultimately, it’s your company, so you must choose them.
  • Set clear expectations and hold people accountable to them.
  • Document the most critical processes for your businesses.
  • Systems need to align with your values and expectations.
  • Systems and process need to be in place. If an employee has a highly skilled position, have them document their processes to be repeatable.
  • Lead your leaders. Leaders lead the teams. Teams lead the systems

Create

Now that you’ve determined your highest and best use, created a team to do your weakest tasks, delegated those tasks to your team, and led the team to success, it’s time to do what you do best: Create more opportunities!

As the business owner, you know your company’s strengths and weaknesses better than anyone else. You also have a grand vision for your company. Where you want to grow, how you want to grow, and when you want to grow. And if you’re not growing, you’re dying. Your company must constantly be growing to be successful.

Think about it like this. If you had cash in your hand today, would you invest it for growth or put it under your mattress? Any successful investor would say, “Invest!” because they know you are losing money if it’s under your mattress. Inflation and other factors will make that money less valuable in the future.

Your business is the same way. If you stay stagnant, it will be worth less in the future. So, you have to be growing to be successful in business. And, if you’re not in business to be successful, get out now and work for someone else. Even non-profit organizations need to be successful for their clients.

As the owner, you need to create opportunities for success and growth in your company. That could be more clients or fewer clients willing to pay more per project. It could mean higher pricing or lower pricing with more volume. It could mean new office locations, new products, or new divisions. The point is you know better than anyone how to create those opportunities.

The opportunity may be a critical hire that replaces you as the CEO while you guide the team as a founder. These opportunities don’t have to mean more work for you. It means YOU create the opportunities and find the right person to do the work. Dr. Benjamin Hardy and Dan Sullivan call this “Who Not How” and wrote an entire book with the same title.

Now, your job becomes creating opportunities for growth and continuing to focus on your highest and best use. You’ve put the systems in place to delegate and hold people accountable to create success for you and them. You have clear expectations and have solid values for yourself and your employees. Your business is growing so you can lead your leaders, and the cycle continues to repeat to create the ultimate want of most business owners: a self-managing business that generates profit for everyone.