Delegation Can Lead To More Profitability

In a small business it’s not unusual that as the business grows certain team members, especially owners and leaders, end up doing work that should be delegated to others.

This happens for a variety of reasons including:

• Lack of confidence that someone else can do the work correctly.
• The assumption that the task will take longer if delegated.
• The work is enjoyable to do.
• It’s client-facing work and is valuable in building the client relationship.

And while some of these might be true, what it doesn’t consider is profitability. While this work might be valuable, having your most experienced team members do this type of work doesn’t make sense financially. Your most experienced team members need to be free to do the strategic work that will create growth and revenue, not tasks that you can pay someone $20 an hour to complete.

This week we challenge you to consider what type of work you have assigned to each team member. Does it financially make sense to have that team member continue to do that work? Start with these steps:

• Create or Update everyone’s job description. Getting an accurate baseline of what everyone does is important. As the business grows it’s not unusual for tasks to get moved around from person to person without updating job descriptions. Ask all members of your team to document everything they do for 1-2 weeks. Use this information to create a job description or update the ones who need it.
   
• Assign value to each task. What could you realistically pay someone to do that work? Don’t allow yourself to get caught up in what your team can or can’t do now, but instead, what the value of the work is for the business.
   
• Calculate each employee’s per hour rate including their benefits.
   
• Highlight the tasks that are below that team members per hour rate.
   
• Begin to create a stop doing list. The stop doing list should be the tasks that the team member needs to stop doing completely, or at least stop doing as often. These are the tasks that you need to start delegating. You don’t have to delegate them overnight, but you should be looking at what systems and training your business needs to put in place in order to be more profitable when doing this type of work.

It may seem cumbersome to take these steps but it will pay off when everyone in the business is doing the right work and it shows in the bottom line.