In a business made of stick, the owner is still very much in day-to-day control, making all the decisions.
Remember the ‘straw’ business, where every customer ‘thing’ is the most important ‘thing’ – and every ‘thing’ is handled by the founder? By contrast, a ‘stick’ business is one where the owner has invested in some key processes to delegate decision making for the mundane and routine things.
Delegation allows the owner to employ more people. But they have to work with processes that are unlikely to be documented, so misinterpretation, short-cuts, and forgetfulness ultimately invite a visit from the wolf.
The limit for how many people can work in a business made of stick is typically up to 35. But why? The more customers you amass, the more activities need to be done to service and satisfy them. That extra load now challenges whether your people can consistently deliver the important things again and again, when you can no longer personally keep control of every person.
The first sign of a load beginning to be too much is when the founder finds themself asking ‘If only people would do their job! Is that too much to ask?’ The answer is then to add layers of supervisors and managers. The reward is less hands-on relationships (phew) and yet it comes with a few twists: an increased wage bill; more distance from the front line; and an increased likelihood of instructions being misinterpreted. This again invites visits from the wolf.
The owner is still knee-deep in the business, working to hold back the rising tide of: rework and write-offs, repeating errors, and lack of accountability.
It’s just like the business made of straw, but with more people and customers. Is the payoff and the stress worth it?
The choice lies, again, between the business staying as it is and the owner investing in a business made of brick.
A quick read, deceptively brief. None of the usual formula of using several examples to support a theory. This is a story about every business which you will be thinking about long after you close the back cover.
Business books are significantly more effective* when they are read in hardcopy. With its bright yellow cover, this one will be visible on your desk or dropped on the coffee table – it will be calling you to read it and implement the wisdom within!
*Big claim, based on donkey's years of experience.
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