Sunday, June 24, 2007

Is Your Company CEO Bound?

Is your company CEO bound? You know, it's a bit like being CPU bound.

One of the great technology books of all time was the performance monitoring book in the NT 3.5 Resource Kit. Want to know whether your bottleneck is the disc, the cpu, or the RAM? Here's your guide to investigating.

Companies are the same way: There are always chokepoints or bottlenecks. Is cash not flowing in fast enough? Do you need more labor? Are things being completed in a timely manner (taxes, filing, marketing, newsletters, invoicing)?

I'm often asked how one goes about moving from a one-person shop to two. And the move from two to three is just as hard (maybe harder).

Or the question is, when do I hire an assistant? When do I have someone else handle payroll? When do I hire a sales person?

Unfortunately, there is no one answer to these questions. For some people, hiring a technician right away makes the most sense. For others, hiring a bookkeeper right away makes sense.

But the question remains: How do you know when it's time to hire someone, and what position do you fill? Here, I believe there is a pattern.

Do a little troubleshooting in your own organzation and find the chokepoints. In most micro organizations (1-5 people), the chokepoint is going to be the owner. I call this being CEO Bound. It's a lot like being CPU Bound.

Now the question becomes a little easier: What is not being done because it relies on me to do it? Then I hire a person to do that thing. The immediate results are: 1) Way too much capacity in that one area; and 2) Lots of time for the CEO to get other things done.

For example, my first hire was a technician. That allowed me to get more clients, bill more hours, and make more money. At the same time, it gave me time to do marketing, put on seminars, give lunch speeches, and get the clients we needed to keep the other consultant busy.

Second, I hired an assistant. If you want to grow your business, or just make more money where you are, hire yourself an assistant. See

With a well-oiled machine in place, the third hire was also a technician. But with a twist. Now someone was taking on the role of Service Manager so I didn't need to do that. With each technician, I gained more freedom from delivering technology and played more of a management role.

But we followed the same pattern: When Karl becomes the chokepoint for some important function, we know who to hire next. When all the new internet accounts are backlogged (DNS changes, moving email to a new server, setting up Exchange Defender, etc.), we hired soemone to take over those special functions.

When requests for quotes were backlogged, we hired someone to perform that task.

In each case, our organization became CEO Bound and the solution was to hire someone who took care of that backlog. Of course that person worked more hours than required for the specific backlog, so our capacity for other things increased as well.

The beautiful thing about this approach is that it's flexible and customizable. Your chokepoint is not the same as mine. We have different skills and we like different things.

Remember: you will create some chokepoints simply because you hate to do certain tasks. It's not that you can't balance the check book: you just hate doing it! The good news here is that you can give up something you hate, and your business will be better for it. Sweet!

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Here are some questions to consider:

Where are you the chokepoint for your organization?

If you could give up one function, what would it be?

Is there one thing that takes 8-10 hours of your time each week? If so, how could you structure this so someone else can do it?

To what extent is fear keeping you from handing off this function?

Do you really want to grow, or are you comfortable staying where you are?

If something really needs to be done, and you're not doing it, who will?

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