Amber is a business owner with a few employees. She has a fantastic model for her virtual assistant services. Work is spreading out of town and even out of state. She has found a way to feed her pipeline, both for clients as well as part and full time employees. Once her systems are in place, the sky is the limit! Oh… except that she is still 64% employee of her own business. What’s up with that?
What’s the Difference
An employee isn’t just defined as someone who gets a check every week or month. It’s defined as a person who performs a task for a salary. Michael Gerber may call them a technician. They have a skill and get paid for performing that skill. The business is dependent on skilled employees.
A business owner is the person who owns the idea, the product and the systems by which it operates. They hire employees to perform the work that generates revenue. Business owners cast vision, create new products, acquire capital assets and run the show.
Almost all small business owners are a split percentage of employee and business owner.
What does that Look Like
64% or 106 hours a month, Amber is a virtual assistant herself. She has contracts that demand the very skill that feeds the business. It produces income. 26 hours a week, she is on the phone, typing papers, adding information to data bases and a host of other virtual assistant duties. She is an employee at her own business.
36% or 60 hours a month, she is a business owner. 4 hours of administration. 12 hours of marketing and sales. 8 hours interviewing prospective virtual assistants. 12 hours mentoring and training employees. 4 hours receiving professional coaching. This is called running a business as a business owner.
The American Dream
Going into or running a business is the American Dream! Freedom! Make your own hours! See your name on the sign across the store front!
I coach a lot of those people. And yes their name is on the sign. But it is also on a number of other important papers such as the Franchise agreement, the SBA loan, accounting login, purchase order validation, the work schedule, the sign-out sheet for the last person going home and the first one to open the doors. And on the Emergency Contact number.
This is a formula for burn out! Even bankruptcy if something happens to that key employee (you)!
This happens everywhere. Paul owns a commercial painting franchise. Mary owned a PostNet. Larry runs an insurance agency with 5 other agents. Bharat owns a factory where he is the chief chemist. And when we looked at their numbers, they were more employees than business owners! OUCH!
Look at Your Numbers
This was a big wake up call to Amber. Looking at the percentage in real numbers (how much time you are actually on the clock as a technician) made her realize that she was too much employee and not enough business owner. So we set a course and created a timeline for her to strategically transition those numbers to a reverse order!
Amber really enjoys the technician role in her business and has determined to keep her fingers in that pie for selected clients. But she also realized that her true American Dream wasn’t to be an employee but a Small Business Owner. By the way, Tom Sawyer was a fence painting business owner!
What do your numbers look like?
Let’s talk about it.
To the American Dream!