Why Entrepreneurs Should Learn to Delegate
Byron Ramirez, Ph.D.
PUBLISHED:
March 21, 2024
According to estimates from the Financial Times, there are over 500 million entrepreneurs on planet earth. This figure includes new business start-ups that emerged during the Covid-19 pandemic. Since the start of the pandemic, several countries have experienced a boom in new business formation. The US Chamber of Commerce reports that 5.5 million new business applications were filed in 2023 in the United States, setting a new record. The U.S. Census Bureau also indicates a continuous increase in the number of new business applications during the past few years. Entrepreneurship is on the rise.
For many aspiring entrepreneurs and new business owners, establishing their own business offers the opportunity to pursue their passion, be their own boss, and have greater autonomy. However, many entrepreneurs often times do not have experience managing various aspects of a business, including managing people. As such, as they attempt to scale their operations and grow their business, they often encounter challenges.
As someone who has served as consultant to entrepreneurs and small and mid-sized organizations (SMEs) across different countries, I have learned that people decisions are the most crucial to the success of any enterprise. A small business can potentially develop and offer the ideal product or service that meets the needs of the market. But in the long run, if the entrepreneur or small business owner does not learn how to manage people, may that be 5 or 25 staff members, the organization will encounter critical issues that will impede its growth and development.
Entrepreneurs tend to be passionate individuals who are committed to achieving success and offering value to their customers. Many entrepreneurs also enjoy the sense of being independent and having autonomy to decide what is best for their business. And as founders and owners of organizations they certainly have the right to choose how to manage them. But in the pursuit of independence and autonomy lies the danger of potentially not including others in the organization in critical decisions that affect the organization.
Working with entrepreneurs for several years has taught me that those who are most successful do not try to do everything on their own. They are comfortable delegating some tasks and responsibilities. The most effective entrepreneurs also make efforts to enrich their employees’ knowledge, skills, and understanding of the organization and industry. They assign important projects to them and include them in planning and strategic decisions. Effective entrepreneurs give their people opportunities to comment on processes, activities and systems, so that they are inclined to seek ways to improve them.
In my years of consulting, I have learned that entrepreneurs must learn to trust their people with important decisions and grant them greater responsibilities so as to prevent the organization’s culture from becoming satiated with conformity, inflexibility, and risk aversion. Entrepreneurs must learn to trust their people to take the initiative and introduce change. Promoting trust, delegating responsibilities, and holding people accountable will help develop people into leaders.
In spite of the complexity and rigor of managing the day-to-day operations, entrepreneurs must also make time to plan for the future and unify the team around long-term goals. Entrepreneurs should stimulate critical thinking across the organization, and encourage problem solving and the exploration of multiple solutions. Dialogue should be promoted to give everyone in the organization an opportunity to voice their opinion and contribute to the enterprise. Entrepreneurs should also make an effort to encourage employees to challenge the status quo and think of ways to enhance existing processes, activities, and products.
It is also important that entrepreneurs continually listen to their employees. Valuable lessons can be learned if one simply listens attentively. Asking questions and listening to employees not only will inform entrepreneurs, but will also serve to build employees’ morale, which can then increase motivation, and in turn increase performance. I believe that employees value an entrepreneurial leader who takes time to ask questions and listen. Hence, I would encourage entrepreneurs to make a conscientious effort to listen to their team.
Several successful entrepreneurs I have met followed the motto: “Never ask anyone to do something I am not willing to do myself”. Many of us admire leaders who are not afraid to get their hands dirty and put in the work. Diligence is admirable. However, it is important to realize that the entrepreneur cannot and should not try to do everything under the sun. I have met some entrepreneurs who have tried to handle every task and make every organizational decision from product design to marketing strategy to payroll. And although these entrepreneurs believed they were being productive; they were inadvertently creating a culture where others did not feel comfortable sharing ideas or taking any initiative. Some entrepreneurs unwisely believe that the best way to lead the organization is to do everything by oneself, and thus they are often reluctant to delegate work.
Entrepreneurs need time to decompress and re-energize, and attempting to tackle every issue and manage every task will not allow the entrepreneur to take time to think and reflect, and even get some needed sleep. It is vital that entrepreneurs take time to slow down and contemplate. Delegating some tasks can free up some time to give thought to important questions and issues related to the enterprise. Moreover, entrepreneurs also have the responsibility to lead their team and to model behavior that will be conducive to effective teamwork and high performance. And in order to accomplish this, entrepreneurs need to learn to delegate and model the behavior of entrusting tasks and responsibilities to others.
Every employee has the potential to make a difference. And entrepreneurs can foster an environment where people are able to contribute. Empowered individuals are more likely to generate creative ideas and solutions. As such, innovation and creativity should be encouraged and promoted in the startup, scaleup, and scaler organization because they can become continuous sources of growth and improvement.
Entrepreneurship is complex and demanding. But learning to delegate can help alleviate many of the issues that entrepreneurs and small organizations face. Entrepreneurs can certainly learn to manage people and organizations. And learning to delegate is an important step towards effectively managing an organization, and building a sustainable enterprise.
References
Financial Times. (2020, December 29). Pandemic triggers surge in business start-ups across major economies. Valentina Romei. Retrieved from https://www.ft.com/content/3cbb0bcd-d7dc-47bb-97d8-e31fe80398fb
U.S. Chamber of Commerce. (2024, February 02) New Business Applications Surge Across the Country. Stephanie Ferguson and Lindsay Cates. Retrieved from https://www.uschamber.com/small-business/new-business-applications-a-state-by-state-view
U.S. Census Bureau. Business Formation Statistics.
Retrieved from https://www.census.gov/econ/bfs/index.html
On December 13, 2024, we lost a seminal management philosopher and theorist: Charles Handy. Like Peter Drucker, Handy was a social thinker and management theorist who emphasized the human side of work as more important than profits and valued individual growth and development in organizations. Handy was born in Ireland and studied at Oxford. In 1956, he went to work for Shell, working in Borneo, where he met his future wife, Elizabeth Hill. Disillusioned by corporate life, Handy left Shell in 1962 to study management at MIT in their executive program. Inspired by their humanistic approach, he returned to London in 1967 to start the London Business School. Handy knew Drucker and was a regular keynote speaker at the Global Drucker Forum in Vienna. The two men had much in common in terms of their approaches to management and social theory. Like Drucker, Handy became an author (although, unlike Drucker, Handy was a corporate executive before he turned to writing). Handy wrote not just on business but also society, serving as much as a social ecologist as Drucker was. In his pivotal book, The Age of Unreason (1989), Handy argued for the disruption of discontinuity – resulting in a new world of business, education, and work that was highly unpredictable. He rejected shareholder capitalism and saw the organization as a place for human purpose and fulfillment, based on trust. Like Drucker, Handy advocated federalism in organizations, disseminating authority and responsibility to the lowest possible levels. He also saw “the future that had already happened.” Handy coined the term “portfolio life,” where knowledge workers would increasingly work remotely and for multiple organizations. In the 1980s, he posited that society consisted of “shamrock organizations”: those that had three integrated leaves: full-time employees, outside contractors, and temporary workers. Handy thus foresaw the new “gig economy” and increasingly autonomy of knowledge work. Finally, like Drucker, Handy had a life partner who not only supported his career but was an independent woman with her own interests. Liz Handy, like Doris Drucker, was an entrepreneur who ran an interior design business, and later was a professional photographer and Charles’s business agent. Minglo Shao, founder of CIAM, remembers Handy as a warm man who made several important contributions to what we see as the fundamentals of Management as a Liberal Art. We are thankful for Handy’s contributions to management theory and social thought, and for his legacy at the Global Drucker Forum in the form of the Charles and Elizabeth Handy Lecture Series.
For 15 years, Charles Handy did us the enormous honor of choosing the Drucker Forum as a privileged platform for delivering his message to the world, and particularly to the younger generation in which he had such faith. Following up on our initial announcement of Charles’ passing Charles Handy (1932–2024) , we are honored to share a selection of his key contributions to the Forum with our wider community. Charles’ brilliant keynotes at the Drucker Forum have become legendary. Normally accessible only to members of the Drucker Society, from today they are available as recordings to the wider public for a period of 30 days. At the first centennial Forum in 2009, Charles talked about his debt to Peter Drucker while outlining his own fundamental management concepts that he had developed over the years. Two years later, he touched on the ideas of Adam Smith and demonstrated how much more to them there was than the celebrated “invisible hand” of self-interest. In his landmark closing address in 2017, pursuing a thread developed in his 2015 book The Second Curve, he called for a management reformation that would turn it into a tool for the common good – thus drawing the first contours of what we would announce six years later as the Next Management . We took to heart his exhortation not to wait for great leaders but “to start small fires in the darkness, until they spread and the whole world is alight with a better vision of what we could do with our businesses”. Management’s "second curve" will be the focus of the “Charles and Elizabeth Handy Lecture Series” in 2025. Following the loss of his beloved wife Elizabeth in 2018 and a severe stroke, Charles was much reduced in mobility in his last years – but not in his determination to continue spreading his message of hope to the world. He couldn’t participate in person in the Drucker Forum 2022, but he participated in a moving online interview with his son Scott, who directed young actors in a short performance of Beckett’s Waiting for Godot by Beckett to illustrate some points. Charles also contributed valued digital articles for our blog and for Drucker Forum partners. Even during the most difficult period of his life he continued to write and develop his ideas in weekly columns for the Idler magazine. This entailed first memorizing the article, then dictating it and finally reviewing it by having someone it re-read to him – a remarkable feat of memory and determination. The article is a jewel and most appropriate for Christmas and the season of self-reflection. Have a wonderful Christmas, happy holidays and a healthy and prosperous New Year.
Interview with Karen Linkletter at the 16th Global Peter Drucker Forum 2024 Video Interview
CONTACT US
+1 (626) 350-1500
1000 S. Fremont Ave - Mailbox #45
Building A10, 4th Floor, Suite 10402
Alhambra, CA 91803
ABOUT
IMPORTANT LINKS
Subscribe for Notifications:
Subscribe
