Unless your business is a one-person band, you will need to delegate authority to your staff, authorising them to make decisions and to sign certain documents on your behalf.
The level of delegated authority you hand over should be relevant to your needs and relevant to their skill set. Some questions you may like to consider include:
- How much control do you want to relinquish?
- What level is the staff member currently operating at?
- Are there any historical trust issues you need to consider?
- What risks are created and how do you manage them?
- Delegated authority may apply to a particular role or in some cases it may be specific to a particular person. Either way, you need to document and discuss the details:
- What decisions are they allowed to make?
- What types of documents are they allowed to sign?
- Is it acceptable for the delegated authority to be re-
delegated down the ranks? - At what stage do you want them to escalate
issues back up to you?
Be particularly careful when staff are signing contracts on behalf of your business as this area is fraught with difficulty – contracts are legally binding and lock you in to a certain course of action with consequences.
It only takes a third party to convince one of your staff to sign a contract, or perhaps a naïve or over-confident manager who is prepared to take matters into their own hands, and WHAM you have a problem!
Levels of delegated authority need to be reviewed regularly: as the business grows and roles develop, you will need to modify levels. Review annually at least.
The more you delegate, the more you risk becoming isolated and ill-informed as to what is happening in the business.
How many times have we witnessed CEOs in the media providing the stock standard answer “I didn’t know anything about this”, when being held accountable for some serious situation. Of course, this generic line can be an indicator they are disconnected and out of touch with the business; however, it is often a symptom of delegation in play without escalation. The person with the delegated authority needs to know the risk they are sitting on, the decisions they are expected to make and the stage they should let you (or their manager) know of an unravelling situation.
When a problem is spiralling out of control, the quicker you step in and provide advice, clarity and offer possible solutions, the sooner you will be able to contain the problem and ensure you minimise reputational damage and possible financial loss. Problems start small and grow with time.
I always found that weekly meetings with my direct report managers kept me in the loop of what decisions they had made, what decisions they were intending to make, and it gave me the opportunity to offer advice on how they could handle tricky situations.
Setting clear expectations, ensuring communication is effective upwards and downwards within the business and being accessible to your team will all help.
At what stage is that person (with delegated authority) able to ring you after hours to discuss an out-of-control problem? I personally operated with an open-door policy.
In addition to weekly meetings, they knew they could pop in discuss a problem any time, including ringing me day or night. This gave them confidence to actively manage and gave me confidence in knowing I was connected.
Be present – stay connected and look out for your team.
