SMB Minded: When the Owner is the Problem

 “Mommy, why don’t all small businesses grow?”

There are many answers to this question. Let’s put aside the fact that there are some business owners, often 1-person shops or those with a few employees, who are running lifestyle businesses and are content with their cash flow. Other than these, I have observed that the biggest obstacle to growth often can be the business owner her or himself. The obstacles usually stem from two overarching themes:

1. The owner has not adapted to the changing business landscape (how people buy, new technology, disruptive new competitors). This is a very common problem and will be the subject of a future post.
2. Or, the owner’s leadership or management style has not evolved as the business has grown.

Here are 4 of the most common ways that business owners fail to evolve:

1. They don’t let go. When you are starting a business, you do most, if not everything, yourself. Your ability to wear many hats is crucial to the successful start of a business. At some point, usually around the $1 million revenue mark, if the owner doesn’t let go and delegate some responsibility (not just tasks), he or she becomes a bottleneck and the business struggles to grow.
2. They practice “drive-by-delegation.” I learned this term from Strategic Coach.  This is when someone delegates something, but doesn’t make the effort to explain the results that they are looking for. The result? It is never good enough and never right, everyone is frustrated, and scale is impossible. I have seen this many times (and have been guilty of it myself).
3. They don’t build processes. It is hard to scale without processes and automation. The interesting thing about this is that most of the business owners that I know are terrible at creating or following processes. Referring back to #1 above, they don’t need to create the processes, but rather to communicate value of them and delegate to someone better suited.
4. They don’t develop the team. In the first few years, a new business needs people who can wear many hats, since opportunities and needs are many and headcount is small. However, as the company grows, it needs fewer generalists and more specialists. This often requires hard decisions, including sometimes letting go of the generalist who can’t adapt to a specialist role, or a long-time employee who resists a new process. Many owners are reluctant to let go of loyal employees who were “there since the beginning.”

How might this affect your B2SMB marketing efforts? We’re constantly saying that the primary goal of your marketing – and thus your content – should be to help SMBs with the issues they face in running their businesses. Provide resources with best practices and peer success stories that show how owners have dealt with the above-mentioned problems. Here are some examples of how this might look for SMB companies in different industries:

• (Banking) – 5 Ways to Reduce Time to Pay Bills (including having someone other than the owner prepare the payment for bills with online bill pay)
• (Marketing Software) – How to Delegate Your Email Newsletter (including how to explain to others what you are looking for with the email newsletter)
• (HR Services) – Building a Team to Double Your Revenue (including how to identify the characteristics you need in your next hire given the size of your company)

Many of my friends own small and midsize businesses. I’ve seen first-hand how the willingness of the owner to recognize the need to change and then to drive change effectively can make or break the fortunes of their company. Your company can help by producing content that positions your product as a solution to these challenges.

SMB Minded is our monthly column providing insights into the minds and hearts of small business buyers.

Get insights and tips for marketing to small and mid-size businesses from the people who speak SMB.