Recently, I interviewed a highly successful entrepreneur who owns multiple businesses and has taken several public. His was a surprising interview, because he completely lacked the typical ‘ego’ we have come to associate with success.
When asked what he felt was his greatest gift, he replied ‘My ability to see greatness in others’. ‘I learned early to value what others could do that I couldn’t, and I quickly figured out it was smarter to pay them to do what they were good at than try to do it myself’. ‘I look for the best and never quibble about their fees.’
The inability to see value in other professionals, and reluctance to delegate are one of the main reasons small businesses fail. How does this occur in otherwise highly intelligent and educated entrepreneurs?
Here’s the story of ‘Mary’, an attorney who specialized in real estate law. Mary was really accomplished in her area of legal expertise. She knew what she was worth, and charged an hourly fee of $350.
The problem was that Mary simply didn’t understand or value all the other areas of business, which were necessary to ensure she had the time to focus on her legal practice. She didn’t understand her accounting system. She tried to design her own website. She knew she needed to produce quality blogs but her writing read like a legal textbook and put her readers to sleep.
Mary checked into the hiring of a CPA, but when she found out it would cost her $90 per hour, she balked. ‘How can I be expected to pay those exorbitant rates?’ she moaned. After realizing her website was based on a template and really didn’t showcase her talent, she called a web developer. The professional developer quoted her a price. ‘Why is it so much?’ exclaimed Mary.
You get the picture. Mary valued her own expertise – to the tune of $350 per hour. What she didn’t value were the professionals who did the tasks she couldn’t do well. After all, she knew little about what a CPA or Web Developer did. It couldn’t be that hard! So, instead of being happy to find –and pay- professionals who could give her top quality work at less than 25% of what she charged her own clients, she let her ego tell her that she didn’t need them. Her undervaluing of every professional (save herself) is what eventually drove her out of business.
Next is the story of Helene. Helene tried to get everything at a discount. Helene needed a logo and tagline for her business. She bragged that she found someone for 1/3 the standard rate. What Helene got was someone who worked on these as a hobby, not as a professional. The hobbyist thought it would be ‘fun’ to come up with logos for businesses and based her fees on nothing concrete, such as the cost of overhead and taxes, net income, break even, etc. Helene’s logo looked as if it were designed by an amateur, for in fact, that is exactly what it was.
Sadly, Helene treated each area of her business the same. She hired amateurs, and got what she paid for. She never became successful, and finally went to work for someone else.
Samuel’s story wasn’t much different. He developed a product that seemed poised to sell millions. He was a brilliant engineer; a ‘think outside the box’ sort of person, who came up with novel inventions.
You guessed it. Samuel also went out of business. Why? He tried to do everything himself. He worked 18 hours a day trying to design a prototype. He also insisted that he design his own website, handle his own accounting, hired employees at a low wage and didn’t have time to train them, and acted as his own project manager. With all the tasks Samuel took on, he needed around 70 hours per day, not a mere 18! Samuel simply wasn’t able to delegate, because he was convinced that no one would do it as well as he did. Of course, he ended up not doing anything well, and it cost him his business.
So what do Mary, Helene and Samuel lack that the really successful entrepreneur possessed? Here are a few of the things shared by this successful man:
- Keep your ego at bay. There are always others who can do your job and probably do it better than you. Know you aren’t indispensable.
- Hire the best – and pay them what they are worth. This goes for everyone from subcontractors to the person who answers the phone. They each have value in the business and are critical to its success.
- Design your company so it could run without you.
- Encourage amateurs to get more experience and education, even mentor them, but know you aren’t getting a ‘deal’ by hiring them. Hiring professionals is more cost effective in the long run.
- Always look for greatness in your team. Nurture the good qualities and allow them to shine.
- Delegate everything you can. This will free you to focus on the ‘big picture’ in your business and take the company to greater heights.
- Quit trying to prove you know how to do everything. You don’t. You aren’t fooling anyone.
Truly successful business owners live by these principles. Studying and emulating those who are highly successful in business will help you avoid some of the pitfalls of those who fail.
Wild Women for Business helps women small business owners succeed! We take a look at the ‘whole picture’ of your business, make recommendations in each area, and then make it happen.