Key Person Risk Indicator
Creating time for business owners and directors
63% of business owners and directors work more than 50 hours every week. Often we see this because too much time is spent dealing with emails, customers and employees (time spent on the wrong tasks).
Why is key person risk important?
Businesses leaders who spend 60-80% of their time working on activities that create growth and increase asset value create more valuable companies.
Those who spend more than 40% of their time working in the business (day to day activities) find the company cannot run without them – this is key person risk and impacts the ability of businesses to grow and be sold.
Therefore we have created this this calculator to provide a quick illustration of how you can think about changing your focus.
It works by breaking your daily activities into 3 areas:
Income – revenue generating activities that include sales, marketing and customer management.
Expenditure – background administration including finance, IT, operations and employee management.
Strategic – spending time actually growing the business i.e building strategy and asset value.
If you are unsure how you split your time then you should complete a diary for at least 2 weeks.