Changing from Entrepreneur to CEO can certainly be a struggle. But there is a way to succeed.
Investopedia defines an entrepreneur as “an individual who creates a new business, bearing most of the risks and enjoying most of the rewards.” And certainly, beginning with the Great Financial Meltdown in 2008 and through the pandemic, there have been millions of people who have, from one motivation or another, become entrepreneurs.
But there is a significant difference between being an entrepreneur and being an Owner/CEO. One is the business, the other runs a business. Many “entrepreneurs” struggle to navigate the transition to CEO and as a result their business plateaus.
How to Transition Successfully
The first and hardest step is making the conscious decision to develop the organization of the business. This includes building trust with your staff and bringing in professionals.
Almost every business starts out small; an idea, (maybe a vision), a few employees (often only 1), and a little bit of money to launch. Then it begins to grow. For a period of time, the entrepreneur can manage this as they do everything or rely on 1-2 people (often family or friends) to help. But they still retain control over every facet of the business.
As the business grows, employees are added, roles are created. In many cases, the structure still revolves around the entrepreneur’s need for control. Organizationally, the company structure is still flat. Supervisors or managers may be in place, but their authority is limited to overseeing daily activities without much thought about goals beyond month-end.
Often areas of neglect include the Accounting, Human Resources and Legal functions. As these are not revenue producing departments, entrepreneurs are often reluctant to spend on staffing these areas. Many of these duties are either add-ons to someone’s regular workload or the entrepreneur adds them to his/her list. The result is that the entrepreneur spends more and more time in administrative work instead of building the business.
At this point the entrepreneur is faced with a decision: Delegate control or stagnate. This is a harder decision than most will admit. Many will deflect by insisting that they already delegate, and on a task level they do, but often only the smallest of decisions do not require the entrepreneur’s approval.
Bringing in professionals or outsourcing certain functions not only frees the entrepreneur to focus on continuing to build, but also brings in viewpoints and expertise to accelerate that success.
When you move beyond “Entrepreneur” you have created a business where managers who know the vision, daily operations run without your input, and you are focused on strategic growth.