Ep. 46 - Breaking the $3 Million Ceiling
- Chad Lingafelt
- Sep 4
- 2 min read
For many business owners, reaching the $3 million revenue mark feels like a significant accomplishment. However, as the hosts of the "Unlocked" podcast, Lars from Calgary Lock & Safe, Tony from Assured Security in Minnesota, and Chad from Loc-Doc Security in Charlotte, NC, discuss in a recent episode, this milestone often comes with a frustrating "glass ceiling." They identify a common challenge where the business owner inadvertently becomes the biggest bottleneck to further growth.
The Owner as the Limiting Factor
Around the time a company reaches roughly 10-15 employees and $3 million in revenue, the owner is typically still deeply involved in daily operations. They're making sales decisions, quoting jobs, and solving technical problems. This hands-on approach, while effective in the early stages, becomes a limiting factor. The owner's capacity to make decisions is maxed out, and a cycle begins: they can't hire more people because they don't have time to manage them, and employees leave because they're not empowered to make decisions on their own.
Changing the Mindset and Delegating Effectively
To break through this ceiling, a fundamental mindset shift is required. The owner must move from a "control" perspective, where they need to be involved in every outcome, to one of entrusting others. This isn't easy and requires being comfortable with mistakes. Lars and Chad shared the "cut the grass" methodology as a way to delegate effectively. Instead of a vague instruction like "cut the grass," the owner provides clear, detailed expectations for the outcome (e.g., "cut the grass in this specific area to four inches by Thursday"). This empowers the employee to make decisions on the "how" while still meeting the owner's standards, building trust and confidence in the process.
The "Passing the Monkey" Analogy
The hosts also used a powerful analogy called "passing the monkey" to illustrate the problem of a leader taking on everyone else's problems. An employee with a problem (the monkey) will try to hand it off to their manager, who often, out of a desire for efficiency, accepts it. This reinforces a cycle of dependency. To break this, leaders must push the "monkey" back, empowering employees to solve their own problems while providing guidance and a clear process. This requires a short period of "harder work and more frustration" to retrain behaviors, but it ultimately frees up the owner's time for high-level strategic work.
Reinvesting for Growth
Finally, breaking through the ceiling is a financial decision as much as it is a managerial one. To hire a management team, a business must be willing to reinvest profits back into the company, even if it means a short-term hit to profitability. This investment in a new layer of management is crucial for creating the capacity needed to scale from 20 to 40 employees and beyond.
Links:
Comments