In 2010 the Cleveland Cavaliers led the NBA with a record of 61-21. The following season, they went 19-62, finishing second to last in the league.
What caused the dramatic downfall?
After the 2010 season, LeBron James decided to take his talents to South Beach to play for the Miami Heat, leaving Cleveland in ruins.
The Cavaliers missed the playoffs for the next three years, failing to win more than 33 games in a single season.
In 2015 James made his triumphant return to his hometown of Cleveland, leading the Cavaliers to the NBA finals and, ultimately, their first championship.
With James, the Cavs were unbeatable. Without him, they were terrible. Like a basketball team, a business can also become too dependent on a single team member, and often that person is the founder.
Building a business with you as the centerpiece comes with challenges:
- You’re unable to take a vacation without interruptions or constantly being worried.
- Your time is spent fighting fires. You get stuck deep in the weeds of your business instead of focusing on your company’s growth. Much of your professional life disintegrates into dealing with customer complaints.
- With you as the bottleneck, your company will forever be capped on how big it can become.
- Businesses that are reliant on their owner are less valuable. The Value Builder System™ analyzed more than 70,000 businesses, and the data shows companies that can sustain a three-month absence of the owner are more than twice as likely to receive a premium offer (defined as >6x pre-tax profit).
- You get held hostage in an earn-out when you sell your business.
The good news is that businesses aren’t built like NBA teams. Unlike basketball teams, companies don’t rely on a once-in-a-generation athletic talent. Instead, you can replace yourself relatively easily by creating systems for employees to follow when you’re not around.
How Jodie Cook Got Her Business to Run Without Her
When Jodie Cook started her social media agency, nothing happened without her involvement. She was effectively the LeBron James of her company. She described her predicament in a recent Built to Sell Radio episode:
“Although I had account managers, I was our clients’ main point of contact. It felt like I had a bunch of assistants, which isn’t conducive to a growing business.”
Desperate to free herself from the minutia of running her company, Cook started to systematize her business with standard operating procedures (download our guide to creating SOPs free). Cook began writing down all the tasks she accomplished daily in a spreadsheet. Then Cook categorized the list to distinguish which tasks took up most of her time.
With a clear picture of which functions were occupying the bulk of her day, Cook set about creating SOPs so she could begin handing off duties to her employees. She started with simple tasks to not upset her clients, which helped build trust with their new point of contact.
For example, she created an SOP for starting a meeting with a client. The level of detail she went into made it easy for her employees to do on their own.
With each task Cook successfully relinquished, the freer she became. Once she successfully handed off all her daily duties, Cook set her sights on creating systems for the rest of the company.
Cook empowered her staff to make SOPs for their own roles as well. Systems provided her employees more time to be creative, leading to happier customers.
It was at this time when Cook realized she had accomplished the goal of fully systemizing her business. Cook found she could take a vacation without worrying about her clients. The company grew through the sales efforts of others, and when she decided to sell, Cook managed to attract a premium cash offer without an earn-out.
Winning feels good, but if your company’s success relies on your efforts, your victory may be pyrrhic. Systematize your business with SOPs, and your company will be able to thrive without you, which is the most significant victory of all.