James B. Harter President © 2008 Sigma Pi Consulting LLC 1248 Rolling Meadow Rd. Pittsburgh, PA p) f)

Avoiding the two headed monster of micromanaging and abdication. Delegation Done Right © 2008 Sigma Pi Consulting LLC

About Sigma Pi Consulting Not a Fraternity but a Formula for Success!  Sigma (  ) => mathematical symbol for Addition  Pi (  ) => business symbol for Profit Most entrepreneurs work hours/week.  Even if they are making money, they don’t have time to enjoy it.  Sigma Pi introduces structure and efficiencies that gives them back a life outside of work. © 2008 Sigma Pi Consulting LLC

9 Common Problems 1. Charlotte’s Web Syndrome 2. Presumption of Profit 3. Poor Record Keeping 4. No Post Mortems 5. Wrong Person – Wrong Job 6. Lack of Accountability 7. Inconsistent Processes 8. Lack of Urgency 9. Lack of Strategic Planning © 2008 Sigma Pi Consulting LLC

Charlotte’s Web Syndrome Starts out as a paradigm. Works until business gets too big. Owner who was the impetus to prior success is now the biggest impediment to further growth. © 2008 Sigma Pi Consulting LLC Root Issue Is Improper Delegation!

The Business Owner Tendency Micromanage in areas of strength.  You are the expert and no one can do it as well as you can. Abdicate in areas of weakness.  You don’t know the area so you hand it off to some one who does. © 2008 Sigma Pi Consulting LLC Both are ineffective !!!

Balancing Authority and Responsibility Low Authority / Low Responsibility => Unproductive worker © 2008 Sigma Pi Consulting LLC Authority Low High ResponsibilityResponsibility High Authority / Low Responsibility => Dictator Low Authority / High Responsibility => Frustration High Authority / High Responsibility => Engaged Productive Worker Micromanaging Abdication

Fixing the Problem The unproductive worker must be given a job to do. The dictator must be held responsible to get work done (and how). The micromanaged must be given authority w/o fear of override. © 2008 Sigma Pi Consulting LLC But Is That All?

Proper delegation is still abdication without Accountability! What gets measured gets done! If you are not measuring it, you are not managing it. © 2008 Sigma Pi Consulting LLC METRICS BUT Choose What You Measure Wisely. If you measure the wrong thing you get dysfunctional results.

Poor Metrics Good Metrics Revenue only Production only Speed only Revenue at a profit margin Production w/o defects Speed w/ customer satisfaction © 2007 Sigma Pi Consulting LLC This is the basis of a Balanced Scorecard.

The Final Piece to the Puzzle - Incentives What gets rewarded gets repeated. If you can devise an incentive plan based on increased profit, you will see improved performance in the target activity. © 2008 Sigma Pi Consulting LLC Profit based incentives METRICS

Sigma Pi Consulting Services Business Process Analysis, Rationalization, and Design KPI Identification and Measurement Balanced Scorecard Profit Based Incentive Plans Flexible Budgets Job Costing and Pricing for Profitability Executive and Staff Training and Coaching Inventory Control and Open to Buy “Over-Under” Tracking Strategic Planning and SWOT Analysis Functional and Positional Organization Charts & Reporting Structures Employee Procedure and Handbooks Job Descriptions © 2008 Sigma Pi Consulting LLC

Thank you for your time. © 2008 Sigma Pi Consulting LLC Jim Harter, President Sigma Pi Consulting, LLC 1248 Rolling Meadow Rd. Pittsburgh, PA p) f)