4 Areas Where Entrepreneurs Need More Expertise

Three weeks ago, 20 million people witnessed a horrific sports medicine emergency on live television. Buffalo Bills NFL football player Damar Hamlin collapsed on the field and required nine minutes of CPR to keep him alive.

The on-site medical staff had done everything in their power to be prepared for such an event. They had the necessary equipment—including an AED—and they’d rehearsed emergency action plans multiple times prior to and during the season. The medical professionals met before the game to review channels of communication and the procedures necessary to respond to any on field emergency.

They were the right people with the right expertise, in the right place at the right time. And they saved Hamlin’s life.

Experts and expertise matter. 

Yet for many entrepreneurs and business leaders, expertise is often deprioritized in favor of an “I can do it myself” approach. On the one hand, I’ve always admired moxy and the entrepreneurial spirit. On the other hand, scaling a profitable firm isn’t ever time for amateur hour! Further, why expend the time, energy and opportunity ($$$) cost to figure things out when you can access expertise to show you the way?

This leads to an important and often overlooked question for leaders: What expertise is required on or around your team to achieve your goals over the next three-to-five years?

To help you derive an answer, here are four critical areas for you to consider:

Management Expertise

“If you think it’s expensive to hire a professional to do the job, wait until you hire an amateur.” – Red Adair

Entrepreneurs tend to take a DIY approach to management, even as their business scales. After all, in most cases, they bootstrapped their way to viability, so they figure this will continue to work for them. But as you scale a firm, you reach a point of diminishing returns on status quo leadership, where the size and complexity of the business catch up with you very quickly.

For example, as a firm’s employee headcount grows, it’s common to tap a top performer and promote them to a supervisory role. But just because someone is a superstar individual contributor doesn’t mean they’re cut out for managing people. I’ve seen this happen many times, and quite often, it doesn’t end well despite everyone’s good intentions.

Entrepreneurs often balk at paying more for expertise because up to this point, their bootstrap mentality has forced them to figure things out on their own through trial and error. The tricky part lies in the cost/benefit math of hiring highly qualified people with the expertise you need. Yes, buying expertise will cost you, but consider the potential return and the opportunity costs of figuring things out on your own (or not!). 

As you scale, this opportunity cost becomes more and more expensive. By bringing someone in who already knows how to manage a team of your size and scale it to the next level, you’re paying for that expertise, and you’ll end up saving.

The same principle applies to larger organizations as well. If you’re running a $50 million firm and want to scale it to $250 million, think about your current head of sales. Yes, they’ve gotten you to this point, but do they have the knowledge and skills to build and operate a quarter billion dollar high-performing sales force? Are you willing to take the risk that your current sales leader can get you there?

Financial Expertise

“If you talk to a top accountant about his field of expertise, it’s mind boggling.”

– Vincent Kompany

Most business leaders don’t come from a financial background. And yet, your job as CEO or senior leader is to drive financial results.

Consider the inception of the financial function in a small firm: When the entrepreneur decides to take the accounting function off of their plate, they typically hire or outsource a bookkeeper. It’s not uncommon over time for the same person to wind up in a Controller or even a default, if highly underqualified, CFO role.

Of course it’s admirable that your original bookkeeper has gotten you to where you are, but they’re rarely equipped to advise and lead the increasingly complicated financial function in your scaling firm. There are serious short- and  long-term implications to your financial decision-making whether you realize it or not, which can put even your future personal financial security at risk.

More timely and more accurate information that supports better decision-making and data-driven outcomes is another benefit of expert financial leadership. Entrepreneurs tend to fly by the seat of their pants when making decisions, but as their firms scale so do the risks. An expert CFO uses data to ask the right questions that frame more productive conversations and decisions.

Over the years, I’ve had several coaching clients who spent lots of money to acquire the right financial expert to help scale their firms. In every case, about six months later, the CEO said to me: “I should have made this investment much sooner.”

You should too!

Operational Expertise

“Chess masters don’t evaluate all the possible moves. They know how to discard 98 percent of the ones they could make and then focus on the best choice of the remaining lot. That’s the way expertise works in other fields, too. Wise practitioners recognize familiar patterns and put their creativity, improvisation, and skill toward the marginal cases.” – John Dickerson

Operations is the business of your business—whether you run a product or a service firm, it’s how the proverbial sausage is made. And at scale, it’s an area where entrepreneurs rarely have the right expertise.

An operations expert is able to cut through the noise. Instead of chasing down every aspect of the business and trying to improve it, the expert can separate the operational red herrings from the right levers to pull.

For example, I have a client in the technology sector who decided three years ago to step out of operations and hire a president to run the firm. He made the decision because he disliked running operations and because he knew he didn’t have the expertise to scale the firm operationally to facilitate an eventual, highly profitable exit.

As CEO, my client still charts the course, but he brought in an expert to make the right operational moves. It’s working: the firm’s growth has accelerated and, more importantly, they’ve consistently hit their profitability targets, which they weren’t able to do before.

How could high-level operations expertise transform your firm’s results?

Learning and Development Expertise

“Never become so much of an expert that you stop gaining expertise. View life as a continuous learning experience.”

– Denis Waitley

What are you doing to integrate learning into the operation of your business?

I’ve never seen an organization whose growth exceeds the personal growth rate of its people. But for many firms, accountability for continuous learning and development is disbursed and embedded within the roles of the senior leadership team who, by the way,  usually have very little knowledge or experience about professional development.

To facilitate growth, you must invest in it. Are you? Or are you talking about how important learning is and then leaving it to your underqualified team to figure out how to execute?

I have a coaching client who trains their staff extensively. To their credit, they hired a head of learning and development, but that person wasn’t the right fit. Once they hired the right expert to lead learning and development, everything changed. Line managers were able to stop stressing out about curricula and learning, and the employees became better trained and more effective in their roles.

The costs of not having an expert who can run a successful development program can be devastating, including the loss of top performers and the stagnation of your team.

Whether in-house or outsourced, how can you acquire the expertise to accelerate your team’s learning and development?

Conclusion

The price you pay for settling in lieu of acquiring the right expertise for your firm is invisible: It only becomes clear in hindsight—like getting a new pair of glasses and only then realizing how poor your vision was before. 

But be careful to not allow someone’s expertise to overshadow their cultural fit with your firm. Yes, experts matter, but if they don’t fit your culture, they will end up doing more harm than good. I’ve seen this play out also—usually at very high levels—and it never ends well. If anything, you must apply MORE emphasis on fit than normal when screening for an expert.

There is no substitute for expertise to accelerate the profitable growth of your firm. You can only bootstrap for so long before the diminishing returns become a stealthy drag on performance and results.

Each client I’ve coached who decided to invest in the right expertise for their business ultimately had the same reaction after the fact. They said they wished they made the decision and investment much sooner.

Now it’s your turn.

Which of the four areas of expertise–Management, Financial, Operations, and Learning and Development–are required to achieve your goals over the next three-to-five years?

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