A sole proprietor is someone who wants to go out on their own. Working for someone else? That’s not the goal. Instead, these ambitious entrepreneurs want to be their own bosses.
And while there are nearly 31 million people who fit into this category, many want to escape their role.
Do they want to quit? No, they want to go from sole proprietor to CEO.
Breaking free from wearing every hat in your organization is only possible when you make this transition.
What are the Benefits of Transitioning from Sole Proprietor to CEO?
At least once a year, someone tells me, “I want to remain a sole proprietor instead of having a team.” For some reason or another, the person wants to be the lone wolf. Maybe they don’t want to deal with the hassle of hiring someone else, or they’re comfortable doing things as they’ve always been done.
But there are many advantages to hiring a team that they may not realize.
But there are many advantages to hiring a team that they may not realize.
Sometimes, a lightbulb moment happens when the person realizes that those tasks that they dread doing can be passed on to someone else. Once they have clarity on this answer, it’s easier to know:
- What kind of person to hire
- What mindset fits the business
Often, a full-time employee isn’t what you require. Start with bringing someone on part-time and then go from there. You’ll be shocked by how much progress your business will make by having someone to delegate tasks to.
You have a lot of weight on your shoulders. Transitioning to a CEO takes responsibilities off your plate so that the business continues to run smoothly when you take a vacation, get sick, or have an emergency.
Sole proprietors who create a business plan that turns their dreams into reality often overlook that a one-person operation:
- Puts all of the business on their shoulders
- Means if you go on vacation, money stops flowing in
- Limits your potential to grow because there’s no one to fall back on
Shifting to CEO alleviates all these headaches. You can grow your business without needing to take on every burden alone. For example, want to go on vacation? Your team can handle things while you’re away without risking lost business or clients.
How to Make the Transition from Owner-Operator to CEO
1. Clarify Your Expectations
If you could hire someone, what would this look like?
- What does the person’s success look like in 30, 60, and 90 days?
- What decisions can the person make without you?
- What tasks will they relieve you from?
- What skill gaps will the person fill?
- How will the person’s role evolve?
Once you have the expectations for this employee written down, it’s time to delegate tasks.
2. Delegate Basic Tasks
What is the one task that you would put at the top of your delegation list? Try delegating it to your new employee. Think of the tasks that:
- Tie up your time
- Drain your energy
- Stop you from focusing on core tasks
- Create bottlenecks that hold your growth back
Some of the tasks that I recommend delegating first are:
- Administrative tasks
- Bookkeeping
- Marketing
- Production/service tasks
For a sole proprietor who does it all on their own, delegating tasks can be daunting. You don’t have to go to extremes from the very start. Hire someone part-time, or, if that’s too much, consider working with an independent contractor.
Delegate a task to them that is hard to get wrong but still frees up your valuable time.
When you’re more confident in your employee, continue adding more tasks to their plates. If you run into issues along the way, reflect on your workflows and how you can make them easier for your employee to complete.
3. When Hiring, Focus on Attitude Over Skillset
Your first employee? They may be a great fit, or they may be a bad one. CEOs must build a healthy work environment, and this requires you to consider each candidate’s:
- Skills
- Experience
- Attitude
Skillset is important, but attitude beats a good skillset all the time because you can often train the person. Attitude, on the other hand, is hard to change and can create cultural issues in your business that are hard to rectify.
4. Monitor Your Team’s Progress and Provide Feedback
Communication and expectations must be clearly explained to your team. Be upfront with your expectations. For example:
- What to expect in the beginning
- How your working relationship will function
- What success will look like
You’re delegating tasks, but this doesn’t mean that you abdicate anything. Fraud and embezzlement happen the moment you stop looking over your bookkeeper’s work, because then there are no checks and balances.
Going off the bookkeeper example, you need to at least look at your bank statements to prevent fraud.
But you’ll have much more than a bookkeeper on staff. You should:
- Start the employee off with basic tasks
- Monitor tasks and provide feedback
- Continue to help the employee improve
Over time, you’ll begin to trust the employee’s work more and can start pulling back on the handholding. Until that point, check in with your team regularly, praise them when work is being done properly, and give constructive feedback when things aren’t going as planned.
Your team will eventually take over the monitoring as it grows. Managers or team leads will become responsible for those under them, and this is when CEOs take their business to the next level.
5. Grow Your Team
After your initial hires are in place and you’re comfortable with the work they’re performing, it’s time to scale what’s already working even further. Maybe you bring on high-level team members to take on some of the more complex tasks that you’re in charge of.
Scaling up your team, when the time is right, and it’s financially possible, means you free up time that is better spent on strategic growth.
Over the long-term, consider whether an in-office or virtual office is the right choice for you. In-office teams are easier to monitor and manage, but virtual offices expand your potential talent pool while requiring you to be more intentional with your communication and oversight.
Final Thoughts
Transitioning from a sole proprietor to a CEO requires intentional steps. Start with the small tasks that you can’t wait to offload because they make your day drag on, and as you feel more comfortable with expanding your team, that’s when a one-person operation turns into a business.
Schedule an appointment to discuss how we can help you transition from sole proprietor to CEO.