How to Transition from an Owner to a CEO

owner to ceo

This may sound strange. You might say, “C’mon, I run a small business, why should I transition to a CEO? What could we possible have in common?” More that you think.

Over the years, we have helped a wide range of small business owners.  There’s been one clear theme that we have found. Many of the challenges successful small businesses face arise from the need to transition from an owner to a CEO.

Your business is doing well. But what’s next? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

Transitioning from an owner to a CEO

So, what’s the difference between an owner and a CEO? And why should I care? It all starts with the mindset shift.

Owner

    • Has complete control of the business
    • Is highly involved in the day-to-day operations
    • Has an intimate knowledge of all the details
    • Plays multiple roles
    • Is not usually accustomed to delegating
    • Business model, systems & processes are usually not optimized

CEO

    • Has shared control of the business
    • Focuses more on strategy & growth, much less on the day-to-day
    • Relies on others to manage the details of the business
    • Focuses on leading & managing
    • Understands that delegation is a way of life
    • Business systems & processes are much more formalized and optimized

Why is this important?

The problem with the owner model is building scale. Unless you can clone yourself, your sales are capped at your maximum capacity. You can see signs of this, bookkeeping that gets put off, working 12-14 hour days, lopsided sales cycles (peaks when your selling, nothing when you’re working), etc. There are countless examples, which generally lead to trouble of burnout (see blog post “How to survive the 3-year itch”)

How do you make the transition for an owner to a CEO?

That’s the harder part, and we’ve found that many people struggle.  We’d suggest you get help, but if you wish to do it on your own, here are a few tips on how to transition from an owner to a CEO.

Learn to let go by taking little steps:

Delegate some minor operational activities to an employee or new hire.  See how it goes.  If it works out, delegate more.  If it doesn’t, find out why?

Hire the right team

No one person has all the skills needed to run a successful business.  It requires a team.  If you try to do it all on your own, you are likely to burn out.  Finding the right talent makes delegation easier.

Ask yourself where you want to be in 5 years?

Knowing where you want to go can significantly help you structure the business so that it can get you there.

Work on your business systems and processes

Clear processes lead to clear communication and timely information.  Both make delegating easier.

Develop your leadership and management skills

There are a number of great online resources that you can use to help build those skills. We also offer some free business tools as well.

It’s not easy making the transition from the owner to the CEO, but ProStrategix can help

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.

Running a Small Business- The Unfortunate Truth

running business unfortunate truth

If you are a small business owner, you probably started running a small business because you loved being a doctor, a lawyer, a craft brewer, or whatever your passion is.  However, the unfortunate truth about running a small business is that you need to have the business skills in order to be successful.  That doesn’t mean you, the owner, need to have those skills, but you need to have people on your team who do.  Let’s face it, no one is an expert in everything that is needed to run a successful business.  If there were those people, there would be a millionaire on every block. That’s where we at ProStrategix Consulting step in.

Feeling like your business isn’t going the right way? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

What should you do to manage this unfortunate truth about running a small business?

Our firm, ProStrategix Consulting, was founded to help small businesses bridge this skills gap they have when running a small business. Based on our experience, there are a couple of key hacks to follow so you can avoid this problem.

ceo mindset

What does having a CEO mindset mean? A CEO has shared control of the business and relies on others to manage the details of the business.  When running a small business, he or she understands that delegation is a way of life.  To make delegation easier and more effective,

 business systems & processes are much more formalized and optimized. This might sound like a mouth full, but it doesn’t have to be as hard as it sounds. Simple things can help. For example, a weekly staff meeting where key staff report on the past week and align on goals for the coming week can help free you up from managing them day-to-day. .

Have a detailed understanding of the business model

A detailed understanding of the business model doesn’t mean having piles of spreadsheets. It requires you to know four key areas when running a small business, and it is important for knowing how the business can grow. First, it is important to know how and why you delight your customers. Are there any who are more valuable than others? Second, how you create value for them. What makes you special? Third, it’s also important to know how you deliver that value. What does it cost you? Lastly and less sexy, it’s important to know how you realize your profits. This is numbers part. Sorry, but there’s no way around that. 

Having a business plan

Did you know that 1/2 of small business don’t have one? Having a business plan is very important when running a small business. Having a business plan is a great way to document your business model. It’s also critically important for loan applications and funding.  It’s often overlooked, but having

 one makes you twice as likely to be successful than not having one.

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.

If You Don’t Plan for Growth Now, You’ll Hate Yourself Later

plan for growth

Most business owners start a business because they love what they do, not because they love marketing, business models, etc. But, if you don’t plan for growth, now, it can create a number of problems later.

If you wait until you start growing before you plan for growth, it’s easy to feel overwhelmed and unsure about what to do next. That’s not a great feeling.

ProStrategix was founded to help small businesses navigate this challenging period.  We found a few good hacks to help you plan for growth early, so you don’t hate yourself later.

Your business is doing well. But what’s next? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

Know what drives your demand so you can plan for growth

It’s important to know what factors drive demand so you can predict it. This will help you ensure that you have the right team in place to handle it, and you are investing wisely. Most small business owners don’t usually spend a lot of time thinking about their

business market plans and models. It’s not the sexy part of the job, but an important one.

Have a detailed understanding of the business model

A detailed understanding of the business model doesn’t mean having piles of spreadsheets. It requires you to know four key areas when running a small business, and it is important for knowing how the business can grow. First, it is important to know how and why you delight your customers. Are there any who are more valuable than others? Second, how you create value for them. What makes you special? Third, it’s also important to know how you deliver that value. What does it cost you? Lastly and less sexy, it’s important to know how you realize your profits. This is numbers part. Sorry, but there’s no way around that. 

Having a business plan

Did you know that 1/2 of small business don’t have one? Having a business plan is very important when running a small business. Having a business plan is a great way to document your business model. It’s also critically important for loan applications and funding.  It’s often overlooked, but having one makes you twice as likely to be successful than not having one. 

Where do the greatest inefficiencies lie?

It’s not just important to know how you drive sales, but also the cost it takes to service it.  If an increase in sales causes you to spend a lot more, accelerating growth can lead to decreasing profits.

To plan for growth, you must invest

This last point is key, and it’s the scariest part.  When you plan for growth, you often must spend the money before you see the reward.  Investing wisely in people, business processes, and business systems can ensure that you have the right people in the right roles at the right time.  It can also ensure that you are efficiently driving sales so it leads to growing profits.

This last point is key, and it’s the scariest part.  When you plan for growth, you often — but not always — must spend the money before you see the reward.  Investing wisely in people, business processes, and business systems can ensure that you have

the right people in the right roles at the right time.  It can also ensure that you are efficiently driving sales, so it leads to growing profits. Taking the time to plan for growth is worth the effort. But, if this isn’t your passion, we get it. Luckily: It’s ours.

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.

Accelerating Small Business Growth: 5 Proven Methods

you don't plan now hate yourself later

One of the concerns that people come to us with most frequently is knowing how and when to grow sustainably. They’re doing well already, but how do they keep improving without falling apart. This article should start to answer some of those questions.  

Your business is doing well. But what’s next? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

1. Don’t Just Satisfy Your Customers, Fulfill Them

People are emotional creatures.  As much as we like to believe that we make decisions solely on rational facts, weighing the pros and cons, in reality… we don’t.  We are driven by our emotions.  It’s important to understand the emotional needs and emotional state of your customers. Emotionally satisfied customer are repeat business, which is one of key was to accelerate small business growth.

Key Questions to ask

What’s driving them to come to you? Are they stressed? Worried about something? Hoping for a better outcome?  Whatever it is, you want to make sure that your product or service leaves them in a better emotional state than when they came in.  If you do that consistently, you’ll have a customer for life.

Have the right team in place

Accelerating small business growth can’t happen if you don’t have people there to handle the demand. Making hiring decisions is one of the most challenging, but the most important decision a small business can make. Finding the right talent is key to expanding and helping your business in all respects. It’s important to be honest with yourself about where your gaps lie.  Small business owners are used to wearing multiple hats and are often afraid of the expense of hiring new people.  However, having the wrong people in the wrong place can severely impact growth. 

Know what drives your demand and can accelerate your small business growth

Knowing your business model is key, and it is often overlooked by small business owners. It’s important to know what factors drive your sales funnel so that you can proactively plan for the demand, and it helps to know what to market and how.  Being able to predict the demand will help you ensure that you have the right team in place to handle it, and you are investing wisely to accelerate your small business growth

Reduce inefficiency

It is worth repeating. Knowing your business model is key.  It’s not just important to know how you drive sales, but also the cost it takes to service it.  If an increasing demand is creating an imbalance in costs, accelerating small business growth can lead to decreasing profits.

Invest wisely to accelerate small business growth

This last point is key to ensure that you are successful in #2-4.  Investing wisely in people, business processes, and business systems can ensure that you have the right people in the right roles at the right time.  It can also ensure that you are efficiently driving demand so that accelerating small business growth leads to accelerating profits.

More information can be found on Small Business Trends. Their post focuses more on online marketing, but it does provide some additional useful information. But if you are looking at how to expand in all markets and all aspects, turn to us. We know what we’re doing, and we know how to help.

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.

How to Survive the 3-Year Itch

3 year itch

Did you know that twice the number of business fail or go out of business in their 3rd to 7th year in business than do in the first 2 years? It’s because of the 3-Year Itch.

Unsure of how to take your business from good to great? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

Just like in marriages, business owners seem to hit an ‘itch’.  It just happens a bit sooner.  Instead of the 7-year, you have the 3-year itch.    The US Bureau of Labor Statistics publishes the survival rate of businesses, and its data shows remarkable consistency.   Regardless of economic conditions, roughly the same percentage of businesses exit between the 3rd and 7th year of existence.  Why?

The 3-year itch comes down to basic human nature.  Just like in a marriage, it generally boils down to 4 key factors

  1. Feeling overwhelmed
  2. Feeling unrewarded
  3. Hidden money problems
  4. Failure to communicate or delegate

Most business owners start a business because they love what they do, not because they love running a business.  It’s easy to feel overwhelmed by everything that needs to be done.  The love of what you do can keep you going for a year or two, but after a while, it takes its toll. Then, 3-year itch starts.

What are the symptoms?

That feeling of being overwhelmed can lead to feeling unrewarded.  Business owners with partners or employees can also have difficulty in communicating or delegating.  Without good communication, it’s more likely that problems will be hidden, which can become a crisis due to inattention.

How can you survive the 3-Year Itch?

  1. Be honest with yourself about what you know and where you need help
  2. Have an impartial party analyze your business and business model to ensure that no one person is carrying too much of the load
  3. Have an impartial party review your business processes to ensure transparent and timely communication
  4. Know which parts of your business are most sensitive and/or carry the most risk

If you find yourself facing the 3-Year Itch, ProStrategix can help

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.

How to Get a Small Business Loan Painlessly

small business loan painlessly

The most important thing to think about when getting a small business loan from a lender is your personal credit.  Few small businesses have a long enough track record to have a long credit history.   Even those that do, if you or one of your partners own a material part of the business (usually about 20% or more), their personal credit can affect your chances of getting a small business loan. 

Unsure of how to take your business from good to great? ProStrategix knows how to help. Read some of our other articles below, or feel free to connect with us and get a complimentary thirty-minute consulting session.

Getting a small business loan from a commercial bank will usually require a personal credit score of over 700 for all the principal owners, partners, or shareholders. At ProStrategix, we’ve seen this be a big problem for a client trying to get a loan. They’re often surprised by how important personal credit is. 

Why is personal credit such an important factor, even if the company has a good track record?  It’s all about risk.  When getting a small business loan, banks worry about how a principal will react when challenged by personal debt.  Will his or her behavior affect the business?

What can you do to raise your score quickly before getting a small business loan?  According to Experian:

    1. Pay Your Bills on Time.
    2. Get Credit for Making Utility and Cell Phone Payments on Time.
    3. Pay off Debt and Keep Balances Low on Credit Cards and Other Revolving Credit.
    4. Apply for and Open New Credit Accounts Only as Needed.
    5. Don’t Close Unused Credit Cards.

By improving the credit score of your principals, you will be able to take the pain out of getting a small business loan.

There are other challenges, when applying for a small business loan, but they are much more easily solved than poor personal credit. If you have questions about whether your business is ready to apply or need assistance with an application, ProStrategix can help.

At ProStrategix, we know you have concerns.  We’re designed to help give you the business support you need so you can focus on doing what you love.  If you would like to learn about how we might be able to help you, please contact us.