[EDITOR'S NOTE: Vistage Connect contributor David Shedd wrote this three-part series in response to issues raised for a recent CEO Entrepreneurship session — but the advice and ideas these articles contain are applicable to any business facing (or anticipating) related issues.]
The Issue: My company is launching commercially next month. As the sole employee, how do I create sufficient resources to cover all my bases?
David Shedd writes:
The key issue for this entrepreneur is akin to the “chicken and egg” syndrome. Do I bring people on in order to scale up and get revenue coming in more quickly, even if I do not have revenue coming in or the cash to pay them? Or do I wait until the revenue comes in and I have the cash to pay people?
This is a milestone that all entrepreneurs face. The answer really depends on the entrepreneurs’ risk tolerance and confidence in his or her product or service. There are not really survey data to determine when entrepreneurs should bring on their first few employees. But in the long term, to be successful all entrepreneurs will have to bring on people, whether they have the cash or not.
Some items for this entrepreneur to consider:
1. If the perfect employee, the “golden child” for your business, is available and wants to come on board, then you should really consider making the move now, even if it means dipping into your own pocket.
2. Here are suggestions on things that the entrepreneur can do to delay making the decision of bringing on additional employees by being as personally effective as possible:
a. Prioritize ruthlessly, focusing on the most important — only do the essential tasks to launch the product.
b. Become more effective in what you do.
- Do the important tasks first thing in the morning, and at times when your natural body rhythms and energy are at the highest.
- Shut off the phone, e-mail, and other distractions.
- Get it done quickly! Do 80 / 20: Get the product as good as can be (80 percent) in 20 percent of the time. Even if you strive for perfection, you will not reach it. No new product or service survives contact with the battle line of the marketplace.
c. Consider out-sourcing as much as possible.
- Get a virtual assistant to help with your unimportant, mindless, and time-consuming tasks. These can be done by the hour or the task.
- Use Elance and related services to get someone to do your graphic design, website or other related work.
- If need be, use iDictate to dictate work or issues and then get the text of what you dictated sent back to you the next day.
3. Finally, if the “golden child” is not currently available, the entrepreneur will need to spend time networking (preferably in the evenings, when the important tasks have been done for the day) to find the right employees, heading toward that time when you will have to hire.
a. Many entrepreneurs fail after their first success because they don’t have the contacts and networks to bring in good people. Tremendous time and effort is thus spent finding people, who then do not work out. This becomes a tremendous distraction for the entrepreneur, and the business then sputters.
David Shedd has 10 years of success as president of a $200 million group of manufacturing and services companies, having overseen 19 different B2B businesses. Currently, Shedd is principal of Winning B2B Leadership, an advisory firm focused on small- to middle-market B2B clients, while looking for his next company or group of companies to lead. David blogs at www.helpingleaderswin.com and his book, Build a Better B2B Business: Winning Leadership for Your Business-to-Business Company, is now available on Amazon.com.