Tuesday, December 15, 2009

Loss of control

What do you do when your business reaches the point where more capital is required for further growth? This is the question that has been worrying one of my clients recently. He asked me; "Is this a leadership or a management issue?"

Its both.

On the surface its a simple management issue - focus on your vision, develop appropriate objectives/goals/strategies (including capital raising), and implement. But underneath is the emotional/leadership issue of power/control/ownership. There are many examples of entrepreneurs dealing with the money issue successfully only to fail because of the underlying emotional one - "I have (or am about to be) losing control!"

There is no question that my client will be able to raise the money he needs - the question relates to the source of the money and the impact that this will have on his role. Will it result in a change of organisational culture so that economic indicators become the total focus rather than the "how' things are achieved as well as the "what" is achieved?

Right now we are exploring the following questions:
  1. how do the sources of finance fit with my vision and goals?
  2. what role will the sources of finance expect to have in the business?
  3. what are the implications of this on me and my staff?
  4. what are the risks and how do they measure up against the returns?
  5. what preparation will I need to make with my staff and clients/customers if changes are going to occur?
  6. what is my "gut feeling" about this source of finance and what are the implications of this?

Leadership and management are not distinct disciplines. In this instance there is a very clear overlap and serious attention needs to be paid to both sides.

More information about Doug long and how I may be able to help you at http://www.dglong.com

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