The Four Causes of Owner Dependence

You hire managers you believe are capable, give people responsibility, build systems, write procedures, and tell people you want them to make decisions. And somehow, a surprising number of those decisions still find their way back to you.

A customer wants something outside the normal rules. An employee situation gets complicated. Someone wants to spend money. A manager has two reasonable options and wants to know which one you prefer. Eventually the question lands back on your desk: What do you want me to do?

If you have owned a business long enough, this can become so normal that you stop noticing what it costs you. For me, the biggest cost was one thing.

Peace.

The constant feeling of “I’m needed” becomes an anchor around your mind, body and soul. It goes with you no matter where you are physically. You can leave the office, go on vacation, sit with your family, or take a walk, but some part of your mind is still attached to the company because you know the next decision may still need you.

I know that feeling because I lived it. And eventually I had to admit something less comfortable:

I helped create it.

We’ll come back to that. Before we go any further, though, we need to define what I mean by owner dependence.

Owner dependence is not owner involvement

I don’t believe the goal of owning a business is to make yourself irrelevant. I also don’t believe there is anything inherently wrong with an owner working a lot. I like working. There are parts of my businesses I intentionally keep because I enjoy them and because they fit what I’m good at—marketing, technology, creative work, research, new ideas, you get the idea.

If somebody told me a mature business means I should stop doing those things, I’d be glad I don’t have a “mature business.”

Then I’d ask:

Why?

When I use the words owner dependence—also called owner dependency—I mean a business that relies on the owner for decisions, context, authority, or judgment that the organization should be capable of carrying without his constant involvement. That is different from simply having an involved owner. The problem is not that the business needs you. Of course it does. The question is whether it needs you for the right things.

Two owners can work the same number of hours and have completely different situations. One may spend fifty hours a week doing work he deliberately chose because it is valuable, energizing, and exactly how he wants to own the company. Another may work twenty hours a week but still hold the few decisions everybody else needs before anything important can move.

Which company is more dependent on its owner? Hours don’t answer that. Neither does whether you take vacations, work from home, or call yourself owner, founder, president, CEO, or anything else. You have to go further upstream.

Start with the end

The starting point is the question explored in What Does Your Business Actually Need From You Now?: what properly belongs with the owner, and what has simply stayed there?

If an owner says, “I want the business to run without me,” my first question is: Why? Do you dislike working?

Maybe the answer is yes. Fair enough. Then we’re talking about a different problem. But maybe you love working. You just hate the work that currently owns you. Then I want to know: What is it that fills you with energy—that if you just did that, you would work until you dropped?

And then: What is stealing your time from that? You can’t intelligently decide what should leave your plate until you understand what should remain on it. What is it that you want?

Before we ever get to delegation, authority, management, or systems, I would start with: Why did you create this business in the first place? What are your goals for owning it now? What is the company supposed to provide? What responsibilities properly belong to you? If you don’t start with the why, all of this is window dressing.

You don’t fix symptoms. You fix the root, and then the symptoms start to subside. Your goals matter, but they aren’t the only thing that matters. The business still has obligations to its customers, its employees, its financial health, and the work it exists to do. What you want from ownership has to fit inside that reality.

So the larger question is: What should this business properly require from the owner in the first place? Once you have answered that, the practical question becomes: Should this decision belong with me?

Some decisions should. A major strategic decision may properly belong with the owner. A large risk may belong with the owner. A piece of work may stay with the owner simply because he is unusually good at it, enjoys it, and intentionally chose it as part of his role. There is nothing wrong with that.

But once you decide a decision should live somewhere else in the company, and it still keeps coming back to you, then you have something to diagnose.

The same symptom can have different causes

When ordinary decisions keep returning to the owner, there are several possible explanations. Maybe the person isn’t capable of making the decision well. Maybe he can make it but does not believe he has the authority. Maybe he is missing information you have. Or maybe the facts are there, but the reasoning behind how to weigh them still lives in your head.

I see four common causes: capability gap, authority gap, information gap, and unexported reasoning. They can look very similar from the owner’s chair. They also aren’t mutually exclusive. The same decision can come back because somebody lacks information and also isn’t sure he really has the authority to act.

The point is to diagnose what is actually there before you start fixing it.

Cause 1: Capability gap

Capability is an easy conclusion to jump to. A manager brings you a solution you think is bad, or hesitates when you think the answer should be obvious, and the temptation is to decide he simply doesn’t have the judgment for the role. Maybe. But hesitation doesn’t automatically mean a person lacks capability. Neither does one bad decision.

I would first ask more questions and gain context. He has a solution, but does he have all the facts? What does he know that I don’t know? What do I know that he doesn’t know? Is he missing reporting or access to something I have?

Who has more context?

That matters because context is reality, and reality informs the mind. This happens to me all the time. I can start out thinking my answer is right, hear the context somebody else is working with, and change my mind. The owner doesn’t get to be right simply because he owns the company.

I also want to know whether the person has actually been trained. It is easy to say, “I told them.” That does not mean they were trained. It doesn’t even mean they understood you. If the person doesn’t understand the expectation, can’t use it, and can’t apply it when the situation changes, I’m not sure I would call that training.

Sometimes what looks like a capability gap is really a management problem. The diagnostic I would use is: If the authority were clear, the information were available, and the reasoning had been taught, would I trust this person to make a sound decision? If the answer is still no—and I’ve truly trained him and given him a chance to exercise judgment—then you may actually have a capability gap.

At that point, more delegation isn’t the answer. Giving somebody more authority than his judgment can support just creates larger mistakes.

You can develop capability. You can coach it. You can give someone more experience. You can let him make reasonable mistakes and learn from them. In fact, you have to. Nobody develops judgment without exercising it.

But eventually you may have to admit the person isn’t growing into the role. That doesn’t make him a bad person. It may simply mean the role requires something he doesn’t currently have. Before I make that call, I want to know I did my job first. Firing somebody for not knowing what you never gave him doesn’t solve much.

You just hand the next person the same problem.

Cause 2: Authority gap

Sometimes the person is capable. He just doesn’t believe he is allowed to decide. That is an authority gap. Before assuming he lacks initiative, I want to know what happened when he made decisions without you in the past. Did you back him?

Did you second-guess him? Did you change his decision because you would have done it differently? Did you tell him he had authority and then teach him, through your actions, that his authority only exists when he reaches the same answer you would? Because that isn’t really authority.

Define what the person owns. Define the limits. These are his decision rights. Define when something comes back to you because the risk, dollars, or consequences are outside his authority. Then honor the authority you gave him.

If I tell a manager he can make decisions up to $1,000 and he brings me a $600 decision, I might ask him about it the first time. Why do you think this? What are you seeing? Let him reason it through. If the decision is legitimate, my answer may be:

“You made a good decision. So next time make this without involving me. I trust your instincts.” And eventually:

“Is this a thousand dollars or less? Then why are we talking about it? I trust you.”

Authority is usually easier to fix than confidence. A manager can know the decision is his and still hesitate. That doesn’t necessarily mean the authority is unclear. It may mean he hasn’t developed enough confidence to use it yet.

Some people need more affirmation than others. Temperament matters. You build confidence by backing good decisions, encouraging the person, and letting experience do some work. If the authority is clear and he still keeps bringing the decision back, you may not have an authority gap at all. You may simply be dealing with confidence, which is a different management problem.

There is also a difference between needing permission and needing a sounding board. Sometimes good managers need to talk through a difficult decision. I do too. You can get inside your own bubble and need somebody who understands the situation to listen while you work through it.

Sometimes the person across from you doesn’t need your answer. He needs somewhere to think out loud. The harder test is when the manager makes a reasonable decision that is different from the one I would make. If I have facts he doesn’t have, I explain them. I tell him why I disagree. Then I want his feedback:

You work in this department and you might know something that I don’t. If I gave him the authority, then the goal cannot be that he always arrives at my answer. Real authority includes some room to decide differently. Otherwise I don’t really have a manager. I have an overpaid person that simply channels problems to me.

And once the rest of the company sees that, they learn very quickly where the real authority still lives. So the diagnostic question is: If this person knew the decision was truly his to make—and knew I would back a reasonable decision—would he still bring it to me? If not, you probably have an authority gap.

Cause 3: Information gap

Sometimes the manager has the capability and the authority, but the information needed to make the decision is not available to him. Then he makes a decision without that context and you think: How could he not see this? Maybe because he literally could not see it. If I had the information he needed and failed to make it available, that means I failed.

My view is simple: the goal of a system is to deliver the correct information to the correct person at the correct time. My goal as the owner, leader, manager, CEO—whatever you want to call it—is to ensure my team thrives. You cannot thrive on bad data. You also can’t make good decisions if the useful facts are sitting in my head, my inbox, a private spreadsheet, or some report the manager can’t see.

Suppose somebody gives a customer a concession that ruins the margin on a job. My first question isn’t automatically, “What were you thinking?”

Could he see the margin? Did he know what the job had already cost us? Did he have the customer’s history? Did he know the rule? Did he know what to look for before making the decision?

If the answer is no, I take ownership of the problem. Then I make sure it doesn’t happen again. I give him the information. I train him to look for it. I make the protocol clear.

If it happens again after that, then it isn’t an information gap anymore. Now he had the information and didn’t follow the protocol. Policies work the same way. If I have a policy and it isn’t written out, talked about, and understood, then it isn’t real.

One thing I learned in managing was that language has to be conveyed through different mediums for different people. Some need to read it. Some need to hear it. Some need a visual example, some do best with all three (which is always smart to do).

The point isn’t whether I technically communicated the issue, the policy, the rule. The point is whether the other person received and understood it well enough to act on it. Otherwise you can spend years blaming people for decisions the system almost guaranteed they would make badly.

And there is another mistake here: trying to solve an information gap with more training on judgment. Judgment without the relevant facts is mostly guessing. So the diagnostic question is simple: Could he make this call if he could see what I see? If the answer is yes, stop trying to fix his judgment.

Fix the information.

Cause 4: Unexported reasoning

This is also why your company shouldn’t need your best thinking for ordinary problems. Your experience should help the organization develop judgment it can use again.

The fourth cause is different. The manager can have the authority. He can have the information. He can be capable. But the reasoning still lives in your head.

This is the part that gets hidden inside the owner’s “it depends.” Of course it depends. The problem is when why it depends has never been taught to anybody else.

What are you weighing? What matters more? What would make you bend the normal rule? What would make you refuse? What are you protecting? What does the company actually stand for? What are you trying to accomplish?

That can’t all live in your head forever. One practice I like from Dan Martell is that before somebody brings you a question, he comes up with three possible solutions, tells you which one he prefers, and explains why. I like that because now I get to see how he thinks.

What did you consider? What did you miss? What are you protecting? What consequence are you worried about? What do you think matters most?

And a funny thing happens after people do this enough. They stop bringing as many questions because the process of forcing themselves to find several possible solutions often reveals the answer before they ever ask. That is what I want. I don’t want to export my answers one decision at a time. I want to help people develop a way of thinking.

And in reality, how would I automatically know which solution is best if I’m not working in this data or with these people all the time? I may have more experience. He may have more current context. Both matter.

This is why I don’t want somebody merely trying to predict what Jonathan would do. If I’ve done my job well, he should understand the standards of the company well enough to make a reasonable judgment of his own. This is where SOPs only go so far.

An SOP can tell someone what to do in the normal situation. But what happens when the situation doesn’t fit neatly inside it? If your answer is always, “Come ask me,” then the reasoning never left you. The wrong response is to write another procedure for every possible exception. You’ll never finish.

At some point the company has to understand the principles underneath the procedures: what standards matter, who we are, what we are trying to accomplish, how we treat customers, what ethical lines we don’t cross, what risks we accept, and how we make tradeoffs when two legitimate things compete. If those answers only live in the owner’s head, then every exception requires access to the owner. You can have beautifully documented processes and still have an owner-dependent company. Turning that private judgment into reusable decision assets gives the company something it can carry forward.

Here is the diagnostic I would use: Have I actually taught the reasoning behind this class of decision? And if this person had the same facts I have, could he explain how to weigh them and reach a reasonable decision without trying to guess what I want? If the reasoning has never been taught, you probably don’t have a capability gap.

You have unexported reasoning.

Sometimes the owner is the problem

Here’s the uncomfortable part: sometimes I was the reason the company depended on me. I was the crutch. I trained people to come back to me.

For me, it came from fear of poverty and fear of failure. I had to know everything going on, so decisions had to come back to me. Then I hired managers that didn’t know how to manage. Each bad manager further confirmed in my mind that I had to retain control. Then the company became more dependent on me because I kept the decisions attached to myself. And that dependence started to feel like proof that I had been right all along:

See? They really do need me.

That’s how the feedback loop closes in on itself. Fear creates control. Control creates dependence. Dependence starts to look like proof that the control was necessary. So you control more.

For me, that loop affected my health, my mental capacity, my vision, my family, my sleep—everything. It made it harder to get my mind far enough above the immediate problems to really see the business. And sometimes there is no complicated diagnosis left. If your managers are good, the information is there, the authority is clear, and you keep checking and overriding them because it is your company, then you have to work on yourself and change or nothing else will change.

The problem is you. Own it.

If you have been the crutch, fixing that starts with a conversation. Explain the rules going forward. Set the expectations. Hold them accountable, and hold yourself accountable too. If you have spent years being the crutch, you don’t get to complain that everybody learned to lean on you.

Be willing to accept that some people may leave because you changed the rules. It’s life. And don’t expect the transition to feel good.

Of course the business will suffer. Accept the pain and move through it. You don’t build muscle sitting on the couch. It takes pain to grow.

The key is to define things before you start the process in the first place. What should improve? What authority is moving? What should stop coming back to you? What would tell you this is actually working?

If you don’t define that ahead of time, pain will make you want to retreat back into the old system. Don’t confuse temporary discomfort with failure. And don’t confuse repeated irresponsibility with growth either.

Let people learn without removing accountability

Once you move a decision away from yourself, you also have to accept that the person making it will sometimes get it wrong. If you give somebody authority, he makes one mistake, and you immediately take the authority back, what exactly did he learn? If every time your kid fell while learning to walk you wrapped him in bubble wrap so he couldn’t try again, how would he ever learn to walk?

People are going to make mistakes. And yes, some mistakes cost money. Duh. How much have your mistakes already cost you?

The issue isn’t that somebody failed. The issue is whether he learns from it. When somebody makes a bad decision, I like to start by talking about decisions I’ve made that failed miserably and what they taught me. Then I ask:

What is this situation teaching you? What would you do differently next time?

What I’m listening for is ownership. Does he immediately take responsibility, or does he give me a list of excuses? Does he tell me what he is going to change—and then actually change it?

If he owns it and takes action, help him. Maybe he was overwhelmed. Maybe he moved too fast. Maybe he wasn’t delegating enough. Dig deeper. The goal is to help him understand why the mistake happened so he makes fewer of them.

But if the same class of mistake keeps happening, and he keeps making excuses or refuses to change, then the problem is no longer the original failure. Now you are dealing with somebody who is unwilling to learn from it. At that point, as an owner or manager, you have an obligation to protect the rest of the company.

You can help people. You can’t change people who refuse to change themselves.

My rule has generally been: Fail and fail quickly, but don’t do the same thing twice.

Diagnose the decision before you fix the company

The next time a decision comes back to you, don’t immediately answer it. Start where we started this article: Should this decision properly belong with me? If yes, make it. If no, then ask why it came back:

• Capability gap: Can he do it?
• Authority gap: Is he truly allowed to do it?
• Information gap: Can he see what he needs to see?
• Unexported reasoning: Does he understand how to weigh what he sees?

And before you blame the person, ask what part of the problem you may have created yourself. The goal isn’t to push every decision away from the owner. The goal is to put decisions where they belong.

At Clean Pro, operations used to come back to me. Now I stay out of it.

The business should need you for the right things

Owner dependence isn’t solved by disappearing from the company. It also isn’t solved by reaching for the same fix every time something comes back to you. Sometimes you need a better manager. Sometimes you need clearer authority. Sometimes the person simply cannot see what you can see.

Sometimes the real problem is that the way you make the decision has never left your head. And sometimes the problem is you.

That is why the diagnosis matters.

The same symptom can come from very different causes, and each one asks something different of the owner. So before you hire somebody else, write another SOP, or take the decision back yourself, ask the harder question:

Why did this come back to me?

Once you know that, you can decide what actually needs to change.

What does this business actually need from me now?

Maybe it needs your judgment. Maybe it needs your creativity. Maybe it needs you to make the big call. Maybe it needs you to get out of operations and let the people you hired actually manage. The goal isn’t to become unnecessary.

The goal is to own the business in a way that fits what the business is for, what you are trying to accomplish with it, and what properly deserves your time and judgment. The company should still need you.

Just for the right things.