“I would have caught that.” She was really frustrated with herself. “If I’d been in the room, I would have seen it coming.”
I was talking to a founder about one of her latest projects. Her team were really great, but the project itself had gone a bit sideways, not badly, not totally catastrophically, but enough that the client had noticed and mentioned it to her directly. Her first reaction wasn’t frustration with the team or what they’d done. It was that she knew if she’d been there, she would have been able to do something about it.
And she was right.
She would have.
Your gut built this
You started this because you’re good at the thing. You won your first clients because of how you do the work, the way you think, the instinct you bring to it. You hire people and they’re good, genuinely good, but they don’t see what you see because they haven’t lived it.
You stay close to everything:
You check the work before it goes out.
You sit in on the meetings that matter.
You hold the thread.
Then one day you realise you can’t be in every room anymore. There are too many projects running at once, too many conversations happening without you in them, and the business has got bigger than what you can feel from where you’re standing.
The bit nobody tells you
When it was you and two other people, you knew exactly what a good project looked like, what it cost, what it was worth, how long it should take, what made the client come back. You knew it because you were in it, you could ask the right questions of your team directly.
As you’ve grown, that’s changed. Maybe you’ve added services, maybe the mix of clients has shifted, maybe you’ve got people on salaries now instead of day rates, or contractors where you used to have employees. The way the business creates value, the equation underneath it, has shifted too, gradually, without anyone writing it down.
You can feel which clients are good and which ones drain you, you can sense when a project is going over before anyone tells you. But you can’t point to it, you can’t show someone else and say “look, there, that’s the thing.”
The same shape, different variables
Every business makes money in broadly the same way. You charge for something, that something costs you to deliver, your clients value it in some way that keeps them coming back or referring others, and you need new clients coming in while you grow what you’ve already got. That’s the shape, and it’s the same shape for everyone.
But the variables inside each of those are completely different for every business, and they change as you grow. The way a tree surgery business makes money when it’s three guys doing day-rate domestic work is nothing like how it makes money when it’s investing in heavy machinery for commercial contracts. Same business, same founder, completely different equation underneath.
And nobody sat down and wrote the new one.
The equation has changed, and everything you’re using to run the business, the reports, the tools, the conversations you have on a Monday morning, is still answering questions about the old one.
More reporting doesn’t help
The instinct at this point is to get better visibility, more reporting, better dashboards, a new project management tool. But all of those things sit on top of the equation. If the equation underneath hasn’t been defined, hasn’t been pulled out of your head and put on paper in a form you can actually look at and question, then better reporting just gives you better answers to the wrong questions.
The first job is defining the equation itself. Getting it out of your gut and into something visible, so the tools, the reports, the team knowing what good looks like without you in the room, actually have something real to sit on.
What it looks like when the equation is on the table
Think about marketing. Before you can write a single piece of copy, before you can run a campaign or build a website, you need to know what value you’re bringing to the market. Without that, everything you build is guesswork on a nice template.
The equation underneath your business is the same kind of foundation. Before you can build any reporting, any system, any dashboard that actually tells you something useful, you need to know how your business actually makes money, specifically, in its current shape, with its current people and its current clients.
Once that’s on the table, things start to shift. Your team can see what a good project looks like without you explaining it every time. You can spot something going sideways without being in the room. You stop carrying the whole picture in your head because other people can finally see it too.
I’ve started calling this operational economics, because it’s the bit that sits underneath everything else, underneath the tools, underneath the reporting, underneath the Monday morning conversation. It’s not accountancy, your accountant tells you whether you made money last year. This is about knowing whether the thing you’re doing right now is actually working the way you think it is. It’s foundational, and almost nobody has it written down. - - - If any of this is landing and you’d like to talk it through, I run free 15-minute fit calls. You tell me what’s going on, I’ll tell you straight whether I can help. There’s a link in my featured section.