Working in your business vs on your business? How to Strike the Right Balance

Are you working on your business or working in your business? How are you striking the right balance between these two?

Yes. I know. The question might be ambiguous.

“No person will make a great business who wants to do it all himself or get all the credit.” – Andrew Carnegie

Having gotten used to doing it all alone, most business founders often find delegation difficult. Many entrepreneurs struggle to pull themselves away from the minutiae of day-to-day operations. However, learning to differentiate between working on and working in your business will empower you to be the leader of your growing business needs.

As Lisa Firestone, the founder of Managed Care Advisors, succinctly put it: “(Delegating) took a while to build trust, but once you do, it is so empowering. We started to grow when I could focus on what I do best and not on daily minutiae.”

If you are interested in learning more about the differences between working in and on your business, we recommend that you take a look at the infographic below from the team at 2Flow. This guide includes some helpful advice for business owners about how to set boundaries and delegate responsibilities to open up more time to strategize about how to grow the business.

Statistics on Business Failure

1. 20 percent failure rate in the first year

About 1 in 5 small businesses fail within their first year, with the highest failure rates occurring in the following industries:

• Information sector (25 percent)

• Arts and entertainment sector (23 percent)

• Transportation and warehousing sector (22 percent) (Source: Bureau of Labor Statistics)

2. 50 percent failure rate within five years

Approximately 1 in 2 small businesses fail within five years, with the failure rate increasing to:

• 55 percent for businesses with fewer than 5 employees

• 45 percent for businesses with 5-9 employees

• 35 percent for businesses with 10-19 employees (Source: Bureau of Labor Statistics)

3. 70 percent failure rate within ten years

Around 7 in 10 small businesses fail within 10 years, with the failure rate varying by industry:

• 80 percent in the retail trade sector

• 75 percent in the accommodation and food services sector

• 65 percent in the professional and technical services sector (Source: Bureau of Labor Statistics)

4. Insufficient time working on the business

Less than 20 percent of business owners dedicate the required 20 percent of their time to working on their business, contributing to business failure.

• Ideal allocation: 20 percent strategic planning, 80 percent operational tasks

• Reality: Most owners spend less than 10 percent on strategic planning

5. Lack of daily reflection

Fewer than 1-2 hours are spent daily thinking about business growth and strategy.

• Recommended daily allocation: 1-2 hours reviewing finances, marketing, and growth strategies

• Reality: Many owners spend less than 30 minutes daily on strategic thinking

 

Working in your business vs on your business

As a business owner, it’s essential to strike a balance between working in your business and working on your business. Here’s a breakdown of the two:

Working IN Your Business

Working in your business focuses on daily operations and tasks. This includes:

1. Meeting Clients: Building relationships, understanding client needs, and delivering services.

2. Answering Queries: Responding to customer inquiries, resolving issues, and providing support.

3. Paying Invoices: Managing accounts payable, ensuring timely payments, and maintaining cash flow.

4. Invoicing Clients: Creating and sending invoices, tracking payments, and managing accounts receivable.

5. Dealing with Conflict: Resolving disputes, managing difficult customers, and maintaining a positive reputation.

6. Customer Service: Handling customer complaints, providing solutions, and ensuring satisfaction.

7. Bookkeeping: Managing financial transactions, maintaining records, and ensuring compliance.

8. Managing Staff and Resources: Recruiting, training, and supervising employees; allocating resources efficiently.

9. Handling Administrative Tasks: Maintaining records, managing paperwork, and ensuring regulatory compliance.

10. Maintaining Infrastructure and Equipment: Upkeeping facilities, upgrading technology, and ensuring operational efficiency.

11. Ensuring Quality Control and Standards: Implementing quality assurance processes, conducting audits, and maintaining industry certifications.

12. Supply Chain Management: Procuring materials, managing inventory, and ensuring timely delivery.

13. Employee Development: Providing training, mentorship, and performance evaluations to enhance employee skills.

Working ON Your Business

Working on your business focuses on strategy, growth, and innovation. This includes:

1. Planning for the Future: Setting long-term goals, developing strategies, and creating contingency plans.

2. Education: Staying updated on industry trends, attending workshops, and enhancing skills.

3. Setting Goals: Defining objectives, creating action plans, and tracking progress.

4. Automating Processes: Streamlining operations, implementing efficient systems, and reducing manual labor.

5. Talking with Mentors: Seeking guidance, sharing experiences, and gaining valuable insights.

6. Market Research: Analyzing competitors, identifying opportunities, and staying ahead of the market.

7. Innovation and Development: Creating new products/services, improving existing ones, and expanding offerings.

8. Developing Strategic Partnerships: Collaborating with other businesses, forming joint ventures, and expanding networks.

9. Enhancing Leadership Skills: Developing leadership style, building a strong team, and succession planning.

10. Building a Strong Team: Recruiting talent, providing training, and fostering a positive company culture.

11. Exploring New Markets and Opportunities: Conducting market research, identifying trends, and expanding into new areas.

12. Creating a Business Continuity Plan: Developing a plan for unexpected events, ensuring business continuity, and mitigating risks.

13. Staying Up-to-Date with Industry Trends: Attending conferences, reading industry publications, and participating in online forums.

By balancing both, you’ll ensure your business runs efficiently today while building a strong foundation for tomorrow.

How to work on your business effectively

Visionary leadership is vital for a business to survive the tough early years. Some experts say that a lack of long-term planning is one of the primary reasons why just 30 percent of businesses reach the ten-year mark.

Ideally, business owners need to spend between one to two hours every day developing ways to move their organization forward. Some examples of tasks that fall under the umbrella of working on your business include:

• Planning for the future

• Spotting problems and delegating solutions

• Goal-setting

• Researching ways to automate processes.

Here are some strategic ways to work on your business effectively:

1. Find Elements of Your Business You Can Delegate

Identify tasks that consume your time but don’t require your expertise.

• Conduct a task analysis to pinpoint delegable tasks

• Train employees or hire freelancers to take on delegated tasks

• Establish clear expectations and performance metrics

2. Find One “Number” in Your Business You Know Little About

Identify a key performance indicator (KPI) you’re unfamiliar with.

• Research industry benchmarks for the unknown KPI

• Consult with experts or advisors for guidance

• Develop strategies to improve the unknown KPI

3. Find a Time-Consuming Task to Outsource

Identify tasks that consume excessive time and resources.

• Evaluate outsourcing options (e.g., freelancers, agencies)

• Assess potential cost savings and efficiency gains

• Implement outsourcing solutions

4. Find Something Wrong with Your Business

Conduct a SWOT analysis to identify areas for improvement.

• Identify weaknesses and threats

• Develop corrective strategies

• Implement changes and monitor progress

5. Find a Way to Further Differentiate Your Business

Enhance your unique selling proposition (USP).

• Conduct market research to identify competitor weaknesses

• Develop innovative solutions or services

• Refine your marketing messaging

6. Find Some Hard Evidence on Your Assumptions

Validate business assumptions with data by:

• Conduct market research or surveys

• Analyze customer feedback and reviews

• Adjust strategies based on evidence

7. Find Out if Employees Have Ideas on How You Could Improve the Company

Encourage employee feedback by:

• Regular town hall meetings or feedback sessions

• Anonymous suggestion boxes or online portals

• Incentivize employee-driven innovation

By implementing these strategic steps, you’ll optimize your business operations, drive growth, and stay ahead of the competition.

Difference between working on and working in your business?

As a business owner, it’s essential to distinguish between working “in” your business and working “on” your business. Working in your business refers to tasks that could be delegated to trusted employees, such as:

• Answering customer service queries

• Paying invoices

• Meeting clients

• Managing day-to-day operations

• Handling administrative tasks

New business owners often fall into the trap of handling these tasks themselves, investing excessive time and energy. This can lead to:

• Burnout and exhaustion

• Limited time for strategic planning and business development

• Inability to focus on growth and innovation

• Reduced productivity and efficiency

Consequently, without dedicated time for top-level strategizing, the business may struggle to:

• Develop a competitive edge

• Expand into new markets

• Stay ahead of industry trends

• Achieve long-term sustainability

To avoid this pitfall, consider the following:

• Delegate tasks to trusted employees or freelancers

• Establish clear processes and systems

• Focus on high-leverage activities, such as business development, marketing, and innovation

• Schedule dedicated time for strategic planning and review

• Continuously evaluate and adjust your role within the business

By working “on” your business, you’ll be able to:

• Drive growth and innovation

• Build a strong team and infrastructure

• Stay focused on your vision and goals

• Ensure long-term success and sustainability

How to stop working in your business

Here are some steps to help you stop working “in” your business:

1. Identify Delegable Tasks

Conduct a task analysis to pinpoint tasks that consume your time. Categorize tasks into:

• High-leverage activities (strategic planning, business development)

• Low-leverage activities (administrative tasks, customer service)

2. Develop a Delegation Plan

• Identify employees or freelancers who can take on delegable tasks

• Establish clear expectations, processes, and performance metrics

• Provide training and resources for successful task execution

3. Establish Systems and Processes

• Develop standardized operating procedures (SOPs) for repetitive tasks

• Implement project management tools for task organization and tracking

• Automate tasks where possible (e.g., accounting, marketing)

4. Focus on High-Leverage Activities

• Schedule dedicated time for strategic planning, business development, and innovation

• Prioritize tasks that drive growth, revenue, and customer acquisition

• Continuously evaluate and adjust your focus

5. Build a Strong Team

• Hire employees with expertise in areas you want to delegate

• Develop leadership skills to effectively manage and motivate your team

• Foster a culture of accountability and ownership

6. Monitor Progress and Adjust

• Regularly review task delegation and system effectiveness

• Gather feedback from employees and customers

• Make adjustments to optimize efficiency and productivity

7. Start Small

Begin with delegating one task or process. You can:

• Identify a low-risk task or process to delegate

• Choose an employee or freelancer with relevant expertise

• Monitor progress and adjust as needed

8. Communicate Clearly

Ensure employees understand expectations and goals.

• Provide detailed task descriptions and requirements

• Establish clear performance metrics and deadlines

• Schedule regular check-ins for feedback and guidance

9. Trust Your Team

Empower employees to take ownership and make decisions.

• Foster a culture of accountability and autonomy

• Provide necessary training and resources

• Encourage calculated risk-taking and innovation

10. Continuously Evaluate

Regularly assess your role and adjust as needed.

• Schedule quarterly reviews of task delegation and system effectiveness

• Gather feedback from employees, customers, and mentors

• Make adjustments to optimize efficiency, productivity, and growth

11. Document Processes

Create standardized operating procedures (SOPs).

• Document repetitive tasks and processes

• Establish clear workflows and checklists

• Review and update SOPs regularly

12. Leverage Technology

Automate tasks where possible.

• Explore software solutions for task automation (e.g., accounting, marketing)

• Implement project management tools for task organization and tracking

• Monitor technology effectiveness and adjust as needed

13. Develop Leadership Skills

Enhance your ability to manage and motivate.

• Attend leadership workshops or conferences

• Read leadership books or articles

• Seek mentorship from experienced entrepreneurs

14. Establish Boundaries

Set clear limits on your work hours and tasks.

• Define your work schedule and stick to it

• Avoid micromanaging and focus on high-leverage activities

• Prioritize self-care and personal time

By following these steps, you’ll be able to transition from working “in” your business to working “on” your business, focusing on growth, innovation, and long-term success.

Conclusion

“Don’t tell people how to do things, tell them what to do and let them surprise you with their results.” – George S. Patton

The first thing you will need to do is assess how you are spending your days, and to identify jobs that can be passed on to someone else. It’s important to hire reliable and conscientious staff that you can trust to make smart decisions and think on their feet.

Offer comprehensive training and let them know that you are there to help, but be clear in communicating what tasks you do not want to be bothered with. Build a trusting relationship with your employees by communicating clearly and by emphasizing transparency.