Stage 3: The Art of Delegation Takes on New Meaning

The Art of Delegation Takes on New Meaning

As companies grow and move through the Stages of Growth, new dynamics arise that test the leadership capabilities of the CEO. As a Stage Three company (20-34 employees), it’s critical to understand that what has worked in the past may not work any longer. 

One of the most significant changes that occurs when a business reaches Stage 3 is that the leader is no longer in control of the organization entirely on his or her own.  Work and decision-making authority must now be delegated.

The key objectives at the Delegation stage include:

  • Moving from a leader-centric to an enterprise-centric organization

  • Setting a productive organizational climate by defining clear expectations, supporting the team to reach those expectations, and rewarding them when the expectations are met.

  • Creating a manager/supervisor layer within the organization, providing training and empowering them with decision-making authority.

  • Focus first on People, then Process, and finally Profit

What To Do When Things Change

Leaders that fail to adapt to the changing “rules of the game” will eventually hit a wall – their organization will become stuck.  Stage 3 is the most dramatic change for the founder/owner of a business.  If you insist on doing things the same way, you greatly increase the risk of ‘entrepreneurial burnout’ due to the inability to effectively delegate work and responsibility. 

As a Stage 3 company, the organization has grown beyond the CEO’s span of control. It is now enterprise-centric, meaning that the organization needs to learn how to function without the leader being involved in every facet and decision. 

It’s typical in Stage 3 to notice work being handed out, but there is no actual empowerment of the supervisory layer of the company.  The supervisors are simply expected to “do the work”.  If something goes wrong the leader responds, “What happened, they didn’t do it the way they were trained” or “They didn’t do it the way I would have done it”. 

This gap is addressed by the Owner/CEO focusing a significantly increased amount of energy toward the Manager “face of a leader”.  This new emphasis on the Manager “face” can be difficult for the CEO, especially if they have little experience as a manager or lack the skills. (Learn about Rewild Group’s Exceptional Manager Program)

The Rules

Some of the Non-Negotiable Leadership Rules for Stage 3 are:

  • Differentiate components of Business Development by separating Marketing, Sales, and Customer Service into three distinct teams.

  • Revamp the company's Business Model to optimize margins, refine Revenue Groups, and adjust Customer Segments.

  • Establish a 3-Year Strategic Plan and a 1-Year Operational Plan.

  • Make sure every employee understands their positions and roles.

  • Delegate both responsibility and authority to 3-5 capable managers and mentor them with regular meetings.

  • Clarify and strengthen communication with all employees.

Focus on your People

With the increased level of complexity brought on by the addition of new employees, the leader must delegate authority and responsibility. This hand-off is one of the toughest challenges for a typical entrepreneur to do. Making the necessary changes as a company moves into and through Stage 3 requires diligence, hard work and the willingness of the leader to ‘let go’ of many of the things they feel comfortable doing and begin to focus on themselves as a Manager.

In Stage 3, your business needs you to be a leader that mentors the team, fosters a collaborative environment of trust and respect, and upholds high standards of success.

So, for a Stage 3 company, the leader has now shifted their Face of a Leader to 60% Manager, 10% Visionary and 30% Specialist. 

Coaching maintains its place as the primary leadership style, but it is not blended with Democratic and Pace-setting as secondary and tertiary styles

Until Stage 3, it has been a juggling act for the CEO or leader to manage, lead, and perform the work. Now, the juggling must stop.  It’s important that the company starts to act more like an independent entity, separate from the leader.  The newly revitalized entity becomes much more tangible and measurable. As a leader, this is the first time you must begin to rely on your leadership skills to run the company instead of your technical skills.  And it’s the first time the leader is not involved in the day-to-day operations of the company.

Once you’ve mastered the art of Delegation, it’s time to move onto the Professional Stage.


Next: Stage 4 - Professional