A lot is written about working “on” your business, rather than “in” your business. I totally agree, but you must also come to grips with the reality of being able to achieve such independence. For most small businesses, the owner is the engine that makes things happen. Obviously, the size of your business plays a role in this reality. Smaller contractors tend to drive the day-to-day and large contractors suffer strategy loss without the owner. Throw in the fact that most owners are driven, confident, self-made individuals who act like they are invincible and the problem multiplies.

Many years ago, one of my consulting customers took over the business minutes before the owner was being wheeled into life-threatening surgery. Even though the owner had been sick for a few months, no plans or discussions regarding the worst-case scenario took place. While business continuation has no guarantees, there are certain things contractors can do to improve the odds of their business surviving if they’re out for an extended period of time.

Start with sound personal financial security practices. Try to have six months living expenses set aside to cover such emergencies. Maybe you should have a little more cash in savings before buying that building or a fleet of new trucks. Next, buy disability insurance from a reputable firm. It’s one thing to have your business struggle to survive, but it’s even worse to have your family suffer. The following simple steps may help your business survive:

1. Don’t be cheap. Sometimes the most frugal of business models can be ok, but they tend to be too owner dependent. Fortunately, frugal individuals tend to set money aside and that will help the business through the illness. However, working out of your home with a weak administrator who is little more than an answering service, leaves little to run without you. Failure to invest in a foreman learning how to estimate and help with other tasks can be short-term thinking.

2. Be responsible. We just had a company branch partner die from hitting a tree on a four wheeler.  This person had no insurance and leaves a non-working wife with four kids. Remember, you are not only responsible for your livelihood but those who work for you. You don’t have to quit skiing through the trees or partaking in adventure sports, but wear a helmet and stay within your limits. People trust their livelihood with you.

3. Learn to be a little less of a control freak. Delegate and let people do their job. Have folks who can think without your influence. It makes for better business and less worry should you become sick. Ask yourself, “If I let this person do this on their own, what’s the worst that can go wrong?”

4. Go outside the family. Consider having someone other than a family member be your office manager or administrator. Your spouse or daughter are going to want to be at the hospital with you and don’t need the added stress of keeping payroll and other vital tasks going. Even if you never become sick, a non-family administrator can allow you to go on vacation and have the business continue. A good office person can call customers, work with key employees and be a tremendous value. The stronger the administrator, the better off you are.

5. Training. Train someone to measure jobs and do estimates. You can be bedridden and help price a job, but you can’t climb up and down a ladder and measure things. Having someone that can measure jobs and schedule crews is a must. Don’t be surprised if when you try this with a foreman or sub, they are poor at it. Most tend to underestimate the amount of time the job takes and forget about things such as travel and set up. It’s not a bad business practice to have crews buy into the time required to do the job even if you never become sick. It’s hard for crews to be on time when they never knew what ‘on time’ was. 

6. Get organized. Have someone in your organization who can schedule work and organize crews. There has to be some type of leader in place and in charge. Maybe it’s merely a senior foreman, but the point is the place can’t run by committee. Most of your employees are loyal and will rally around you but they still need guidance and direction.

7. Trust others. Can you have a friend or backup? Our networking group participants are very close to one another. On more than one occasion, they’ve flown in and helped run the company in the owner’s absence or death. You can possibly form a pack with fellow association members, a family member, or a former employee, etc.

8. Policies and procedures. Larger contractors need to make sure there are procedures in place to authorize day-to-day practices such as check signing and purchasing. More importantly, all deals and strategies need to be communicated and not just in the owner’s head. If your head is sick, make sure others know what’s in the works.

In summary, we’re all human and none of us are going to live forever. Some simple structural changes to your business may go a long way in helping it survive if something happens to you.