31st August 2017

Business Imperative

One of the best things about owning or leading your own business is that you are accountable to no-one. One of the worst things about owning or leading your own business is that you are accountable to no-one.

It is ironic that one of the major attractions about running your own business is the opportunity to be your own boss; to not have to answer to anyone other than yourself, should also turn out to be one of the greatest challenges as you endeavour to scale up that business. There are many challenges with scaling up a business when it is an independent, privately owned firm. One of them is quite simply the challenge of accountability.

In larger businesses, there is usually a structure which although it may be frustrating also has significant benefits. In larger companies everyone has a boss, someone or something to whom they are accountable; a manager, a general manager, a regional manager. Even the managing director will have the board to whom he or she is accountable, or indeed it will be that most demanding of masters, the city or the shareholders. In smaller businesses, too often that structure of accountability doesn’t exist, or where it does it is not effective enough.

Within that structure of accountability, we often find ourselves having to justify almost every decision. Our outcomes are regularly and closely scrutinised. We stand or fall by our results. That same level of scrutiny is often absent in smaller businesses and consequently performance can suffer from the absence of the same level of discipline and scrutiny.

There is often an imperative to perform well in a large disciplined structure which can be absent in smaller enterprises. In a group situation, a manager, at any and all levels, might find himself constantly compared with the results of his peer group. Comparisons and benchmarks are everywhere.

Having been part of businesses at both ends of this spectrum I am not simply suggesting that larger businesses are more demanding, more professional or better managed so much as pointing out the challenges that smaller businesses may have in creating an effective set of imperatives that demand consistent high performance.

An SME that can create the right balance of freedom, flexibility and structure and discipline can create something really special, for team, shareholders and customers alike. It can become a great place to work and to do business.

I was recently reading about an Olympic athlete who, at one point, jettisoned his national squad’s training regime to go and ‘self-train’ and I was struck with just how difficult that must have been for him. It reminded me of the challenge that many small business owners face. The athlete eventually succeeded but he couldn’t completely abandon all accountability or the benchmarking regime as he had to attend national trials and qualifications, so he wasn’t totally cast adrift. He had those deadlines to meet and qualification times to hit.

I wonder what the accountability structure is in your business and how effective it is? Are you developing a culture of accountability and excellence across your business? If you are a business leader or owner, to whom are you accountable? Is that working for you?