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Startup CEOs: Delegate Responsibility Don’t Outsource It

So here begins a possible series of posts for startup CEOs and founders, based on my experience with Standout Jobs (and before that). I have a few ideas to work on, we’ll see what comes of them. Here’s the first…

The role of startup CEO is to delegate responsibility, not outsource it.

I’ve mentioned before that startup CEOs need to do sales. At the same time I’ve also recommended that startups get a ton of help for non-core activities such as bookkeeping, accounting, etc. Those might sound a bit at odds, but they’re not.

Startup CEOs absolutely need to do sales. At some point once you’ve figured out what’s working and what’s not, to the best of your abilities, you should delegate the process (and refinement of that process) to someone else. But the minute you think about outsourcing sales, you’re giving up your own responsibility for it, and that can be extremely dangerous.

Startup CEOs absolutely should hand over non-core work to others. Bookkeeping and accounting are great examples. And in effect, you are outsourcing this. But the ultimate responsibility for the financials lies with you. Investors and employees aren’t going to turn to the bookkeeper or accountant for answers on why there’s no money left in the bank. They’re coming straight for you. And that means you have to delegate this responsibility vs. outsource it. You have to understand the numbers, how everything works, and have your finger on the pulse of your startup’s financials at every moment, so you’re not abdicating responsibility just delegating some of it.

The role of Startup CEO is to be involved in all key processes and activities within and around the company. That might not scale over time, but initially, it’s essential. Customer service — don’t just outsource, delegate. Figure it out yourself, as startup CEO, do the work, talk to complaining customers, field angry emails, before handing over a portion of that responsibility to someone else. There are plenty of other examples…

Outsourcing responsibility can very quickly turn into, “I’ll give this work to someone else so I don’t have to think about it anymore.” That’s a very, very dangerous place to be.

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May 4, 2010 Posted in Startups by

  • http://consultski.blogspot.com consultski

    >> Figure it out yourself, as startup CEO, do the work <<

    Great start from the “new and improved” Ben Yoskovitz.

    You bring a unique vantage point to the table (having just engineered your exit from Standout Jobs) that demands entrepreneurs (and would be entrepreneurs) pay attention. I look forward to more words of wisdom. This first post was a great reminder of a concept that can easily “get away” from the busy CEO.

  • viemax

    Wau,, thank you for your nice information. and I will try it

  • Pingback: Startup CEOs and Startup Founders Need to Focus on Alignment with Investors, Customers and More

  • http://www.raduprisacaru.com Radu Prisacaru

    I really enjoyed this post. I have read over a few other posts you have up and I will say you do a great job of blogging. I will be looking for new post daily…Keep up the good work! I invite you to see my post, I hope you will find interesting too.

  • benlanders

    Care to expand on this point: “But the minute you think about outsourcing sales, you’re giving up your own responsibility for it, and that can be extremely dangerous.”

    Just because someone else is doing sales for your start-up company doesn't mean that the CEO has given up responsibility for it. What's the big danger?

  • benlanders

    A ha… just read your other blog post on sales.

  • http://dallastxlofts.com Chase

    Good point. So many startups tend to outsource too many of their responsibilities and therefore, fail to understand some essential aspects of their business. There's a happy medium between doing it all your self, and outsourcing all of your work, that you must pin point to be successful.

  • http://startups.com/ M_Dilli

    Is it me or the concept of delegating and outsourcing is being confused in the article?
    Even if that's not the case I don't think it is a good way to go to do everything yourself. Why not? Because it is impossible!!! And when you are dealing with a lot of things at the same time rather than gaining control, you are loosing focus on each and every single activity you are performing. It is true that it can be difficult to find people to be trusted in order to delegate important tasks but there is no other way to go through this.

  • Jamie Lee

    I think that there is danger behind it but instead of focusing on it why not try to look for the good point of outsourcing since there are a lot reason why some business do outsource not just because they want to let someone work on their responsibility.

  • http://creditcard.usavisacard.com John Foo

    You're absolutely right on this —> The role of startup CEO is to delegate responsibility, not outsource it. By the way is there any CEO outsourcing his responsibility?

  • http://www.aydinla.com aydin

    Thanks for the article!

  • http://www.instigatorblog.com Benjamin Yoskovitz

    Outsourcing is a reality of doing business. And a necessity. I've recommended in the past, for example, that you outsource things like bookkeeping and accounting to people who know what they're doing. But there's a difference between outsourcing and delegating, where people take outsourcing to the point of not being involved whatsoever in what's going on. That's dangerous.

  • http://www.instigatorblog.com Benjamin Yoskovitz

    I'm definitely not arguing for “doing everything yourself” — but I do think it's important to be careful about what you have others do, especially if you don't understand what's going on and how it's being done.

  • http://www.instigatorblog.com Benjamin Yoskovitz

    The danger – as described in one of my other posts – is that you don't know how to do sales before you outsource them. If that's the case you're outsourcing the process of figuring out the sales effort, how it's done, who is responding, who isn't, etc. Outsourcing that is like asking someone else to breathe for you.

  • http://petstoreunlimited.com/dog/dog-training-collars/sportdog-stubborn-dog-100-yard-trainer-sd-105s.html Logan

    I completely agree with this. Its a very dangerous thing to do. You never know if somebody else managing your money would ever decide to run.

  • http://plr.web.id plr

    wow good posting, wonder why i just found it now. Maybe someday i’ll back again. 01:43

  • alexdropshipping

    Being responsible is really important especially if you have a huge task. Just like what Spiderman said “With great power comes great responsibility”. CEO is a great responsibility because on wrong move will result into a disaster. The option of outsourcing is not really an option because idea of the people will only result into a disaster. Different ideas will be mixed up and your own ideas will not run smoothly.

    Great idea! Thanks!

    Alex

  • http://www.pornoiizle.net/ porno

    Responsibility should be delegated, not outsourced Thank You admin

  • http://bisnispenghasildollar.blogspot.com/ yandi

    yes it should

About Ben Yoskovitz
I recently joined GoInstant as VP Product. GoInstant changes how we use the web, making it shareable like never before.

I'm also a Founding Partner at Year One Labs, an early stage accelerator in Montreal. Previously I founded Standout Jobs (and sold it). I'm a hands-on startup guy, helping companies grow successfully from the idea forward. You can reach me at byosko at gmail dot com.

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