21 Mar Are you Invaluable or Indispensable?
When you were younger, did you ever participate in a spelling bee? I recently reconnected with some childhood friends and it reminded me of something I hadn’t thought of in a long time – the day I lost the 5th grade spelling bee. I lost on the word “indispensable.” Though the sting of that day is long gone, the lesson has stayed with me. That’s how it is with things that don’t come easily to us – once we’ve mastered them, we rarely repeat the mistake. Which is a good thing, because that word “indispensable” comes up a lot in working with family owned businesses.
“If I want it done right, I have to do it myself.” If you’ve ever said that, or even thought it privately to yourself, it’s understandable. Most of today’s family businesses were started by entrepreneurs who were willing to risk it all for the chance to build a company under their own control. But that word control comes with a price. After risking so much, many leaders are reluctant to let other people take over from them. Even if those people are highly qualified. Even if those people bear the same last name. And yet one of the most important lessons family business leaders can learn is that they are most valuable when they become dispensable. Here are four important reasons why.
- The more dispensable you are, the more valuable your business. This is counterintuitive for some people. Yet if the business is dependent on a founder or senior generation leader, it’s just not as valuable. The opposite is also true – if the business can operate day to day without your direct involvement, it’s far more valuable. Indispensability also limits growth. When important decisions in the business flow through one person the majority of the time, instead of through a team of qualified people, it becomes a constraint on how much the business can grow.
- Stronger focus means stronger results. Entrepreneurial leaders sometimes discount the importance of dedicated focus. In fact, many pride themselves on their ability to multi-task and handle dozens of priorities in a day. For example, Cory thought that no one could bid jobs in his construction company as well as he could. Though skeptical, he brought in an estimator whom he thought could do a “good enough” job. In the first four months, new projects increased significantly. It worked out that way partly because as head of the company, Cory was spending only 25% of his time on bids and estimates, while the new employee spent 100% of his time on it. Even if the new employee was only half as good as Cory, the fact that he spent so much more time on it meant they could go after more projects. The benefit of dedicated, focused resources applies to nearly every area of a business, from IT to sales to accounting.
- If you’re indispensable, you may be wasting money. Imagine yourself at home on a Saturday morning. The doorbell rings and it’s the Sunshine carpet cleaning company. As you let the crew in, you hand them a check for $350 and say, “Come on in guys, I just made a fresh pot of coffee. Why don’t you settle in on the couch and I’ll get started on the family room carpet. I made up my own batch of spot remover last night, so I’m gonna try that out, too.” Sounds silly, right? Yet aren’t we doing essentially the same thing when we have capable people on the payroll and can’t stop ourselves from telling them how to do their jobs? Or worse, from doing their jobs ourselves?
- Working on your “dispensability” is good practice for succession planning. If you think there’s even a chance you’d like to pass the business on to another generation, it’s never too early to practice. A smooth transition of leadership isn’t going to happen spontaneously at the exact time you’re ready to turn over the business. Leaders need practice in letting go and successors need practice taking the reins. Neither of which can occur when leaders operate as if they’re indispensable to the business.
If you want to grow your family business and see it last for another generation, your contributions will be invaluable if you don’t make yourself indispensable. (Or indispensable.)