Entrepreneurs must learn how to delegate
"Alaskans seem willing to take risks. We seem eager to do something different, which is why we all live here," said Gary Selk, a professor at the University of Alaska Anchorage’s School of Business and Public Policy.
At the same time, Selk said, many entrepreneurs and small business owners lack a complete grasp of the skills they need to make the right decisions, particularly if the business is growing.
Fortunately, many seek advice and training, which is available through the university and a number of consulting services, he said.
Two areas where business owners commonly encounter trouble is, first, when rapid growth outpaces financial and accounting systems, and second, when it comes time to bring on more help and delegate authority, Selk said.
One local company Selk has been advising has seen rapid growth, but while the record-keeping system was adequate for the business at a smaller scale, it was completely inadequate for the size the firm has grown to or where it is headed.
"Also, no one in the management, which were also the owners, had the skills to really understand what the financial reports were telling them," he said. "They also had no clear direction of where they were going," as a business.
In this case, some help in developing a strategic plan was a starting point. But the clients were also unwilling to lose control by bringing in a chief executive officer with the needed skills, he said.
Additional training for the management team will address part of this problem, but unwillingness to delegate authority is the most common hurdle owners and managers of growing businesses must overcome.
"It’s a quantum leap to someone to give up that sense of control, but if you don’t, you’re just so caught up in day-to-day tasks that you lose the big picture," Selk said.
Selk has experienced the difficulty himself with a small nonprofit corporation he started and continues to operate, the Alaska Business Development Center, which offers management consulting services.
"It’s hard to give up control over the checkbook, hiring and firing, and other key decisions," he said.