Half-Retirement© Blue Print

Half-retirement is an alternative to selling your business. You work two half-days a week doing the work you enjoy while keeping your existing income.

Over decades of business ownership, your fingerprints are imprinted on virtually every aspect and process of the business. To create a business that runs well without you in the building, you must create a process that runs smoothly without your involvement.

Today, this may seem like a pipe-dream. Do not be discouraged. Every business owner is capable of creating a business that runs well (and profitably) without them. However, you do need a roadmap to take you from where you stand today to the promised land. That’s where the Blue Print to Half-Retirement© can help.

Blue Print to Half-Retirement©

Most business owners take one year to complete the phases. Remember, it took years to create your business. Sorry, you won’t be able to create a viable exit plan over a weekend.

Below are the eight phases of the Half-Retirement© Plan:

  • Phase 1: Discover your Picasso work
  • Phase 2: Use a process (e.g. 98/2) to shift lower-value work to the team
  • Phase 3: Shift from owner-driven enterprise to employee-driven enterprise
  • Phase 4: Create a “this is how we do things” culture, so you do not need to be the standard bearer
  • Phase 5: Create a strong second in command
  • Phase 6: Strengthen systems so the systems run the business and the people run the systems (and not the other way around) (line up under Strengthen)
  • Phase 7: Create tight financial controls to protect your income
  • Phase 8: Enjoy the spoils of Half-Retirement©

Half-Retirement© Blue Print Detail


Phase 1: 

Discover your Picasso work

Business owners have a “get-it-done” mentality that is a powerful driver for their businesses. Unfortunately, this same mentality leads to many business owners having 743 responsibilities each week. Not every task you perform requires the top person in the organization to complete it. Usually, there is no genius or “magic” required for all these tasks, but rather a unique ability to juggle.

This presents an opportunity to unravel the work where special skills/genius IS required from the rest. We call this special work the Picasso work. There are many tasks necessary to conceive, create, and sell a work of art. However, it only took Pablo Picasso touching the brush to the canvas for it to be called a Picasso. Cut your work down to the high-value Picasso work and you are on your way to Half-Retirement. Here are some examples of Picasso work:

  • Client/vendor relationship owner
  • Driving strategy, innovation, etc.
  • Acting as the “standard bearer”
  • Wearing “The 16 Hats”. Short version: the high-value, low frequency work that only the owner can perform effectively. Watch a presentation on this topic. (make squeeze)

We use a tool called the Delegation Grid to segment the highest value (Picasso) work from the rest. You can see the Picasso work represented in the chart below.


Phase 2:

Use a system to shift low-value work to the team

If you have ever tried to delegate something important, you know that it’s one thing to WANT to delegate, it’s another to successfully do it (wink). Delegation is hard because most of us practice what we call all-or-nothing delegation. It works like this, I used to do all of this task/responsibility and now I’m going to do none of it. This 100% then 0% delegation is difficult to pull off, so we found a better way.

We noticed that successful delegators almost never delegated all of a task. They only delegate 98% of it. They keep the Picasso work or the work that’s simply too hard to delegate. Think about it. I If you offload 98% of a responsibility, you still save a ton of time.

It is not possible to jump from 100% responsibility to 2% responsibility. You must remove the work in stages. We have a process called 98/2 Delegation that uses a five-step process to shift the work from you to them. The chart below shows the five phases of delegation.

The primary tenet of 98/2 Delegation is fractionalization. You must change how you think of a process or task. No process is only one step. Even changing a light bulb involves quite a few discreet steps as you can see in the graphic below.

By fractionalizing the task/process, you can offload the mundane portions while keeping the highest value work yourself.

Take the full 98/2 Delegation Course


Phase 3:

Shift from owner-driven enterprise to employee-driven enterprise

Entrepreneurs have many qualities that help drive a successful enterprise. However, some of these qualities will work against them when trying to half-retire. For instance, the willingness to jump in and solve problems works well if you are working in the business, but when you are not present (half-retired), who will jump in?

To make things worse, you may have inadvertently trained your employees that they don’t need to jump in, because they know you will. We call this “the falling ornament test.” Problems in a business are like a falling glass ornament. Employees are perfectly capable of catching it before it breaks, but the owner has more information and always sees the ornament falling before the employees do. Many owners jump immediately and catch the ornament, depriving their employees of the opportunity to catch it and teaching them that they don’t need to try.

This is just one example of how things getting done inside your business need to change. You need to shift from an enterprise driven by you, your time, talent, and actions to one that is driven by your strategies and the employees’ time, talent, and actions.


Phase 4:

Create a “this is how we do things” culture, so you do not need to be the standard bearer

One of the key roles of the owner is that of the standard bearer. The standard bearer is the person who determines:

  • The expected/minimum level of quality of work sent to customers
  • The highest/lowest pricing allowed
  • The acceptable effort level of employees
  • Keeping performance-pay ratios in line

Put another way, this person determines “This is how we do things around here.” When you are not in the building, this standard may leave with you.

In order to have the business run properly, you must create an organizational culture that enforces the standard rather than a person (i.e. you) doing so. You can begin this process immediately. Simply follow these steps to shift the standard.


  1. Eliminate your ego. It feels good to be the standard bearer, but it feels better to Half-Retire. Learn to feel pride in the standards being met, not enforcing them yourself.
  2. Make a list of the most important standards or business axioms important to you, your customers, and your employees. Examples might be: In a situation of conflict, employees first, customers second; we will never cut prices to secure a deal; raising your voice to a customer will not be tolerated.
  3. Adopt the phrase “This is how we do it” or “That’s not how we do it here.” This will shift the conversation to standards of the company vs. your standards.
  4. Identify the most respected and cooperative team members. Solicit their help in reminding other team members “how we do it.”
  5. When you catch something below standard, try to get a key team member to rectify it instead of you. This will speed the organizational standard bearing.
  6. Pay attention to how often you have to enforce the standard vs. the self-correcting cultural mechanism. Once you do not have to enforce the standard for several months, your work on this aspect is nearly finished.

Create a Powerful culture

Southwest Airlines has 53,000 employees who smile. At Southwest, it’s universally expected to be light-hearted and friendly. The CEO doesn’t need to enforce it, everyone does.

Find the 2 or 3 principles that make your company great, and burn them into every employee via culture norms. You are probably doing this instinctively now, but it will need to sustain itself when you are not around every day.

Once you have identified the key principles that guide the company, be sure to empower everyone on the team to live them. Allow anyone and everyone to enforce the standard. If employees are supposed to greet customers with a smile, anyone on the team should be able to say, “ Hey, don’t forget to smile” to anyone else, regardless of rank.

Be prepared to invest time and money to accomplish this aspect of the plan. Once you demonstrate that the key cultural principles are important enough to invest in, people will change.

Lastly, learn to get joy from employees’ successes, not yours. It’s hard when you have been a “doer” for so long, but shifting from doer to coach is a must to accomplish Half-Retirement.


Phase 5:

Create a strong second in command

The buck needs to stop with someone besides you – but who? Is this person currently on staff? If so, great. If not, what happens to morale if we leapfrog existing team members?

These are all considerations for choosing a second in command. In our experience, most businesses do not have one person who can perform all the duties the half-retiring CEO mastered. After all, if this person was on staff, you would already have them running the business, right?

So what do you do if you do not have one person that can successfully manage all the key areas? You fractionalize the responsibility. This sounds easy, but done wrong, you end up with a four-headed beast and decision-making nightmares. Here is the formula that has worked for other business owners:


  1. Delineate all the decision-making and functional areas
  2. Is there someone on staff who can effectively manage this area?
  3. Try to keep the list of people on the second-in-command list to four or fewer. The fewer on the list the better.
  4. Add an area of responsibility called “Ultimate Decision Maker.” This person breaks ties, settles impasses, vetoes bad ideas, etc. This role is critical if the fractional responsibility plan is going to work. Without one person in charge if needed, the plan will fail.
  5. Make sure the team understand the roles and authority lines and is willing to abide by them. For instance, there could be a situation where the customer service manager can override his boss if he is second in command for a particular issue.


Phase 6:

Strengthen systems

If you are like most business owners, YOU are part of the system. Removing the Jenga piece called “you” will hamper the system somewhat. In order to ensure your Jenga tower (a.k.a. business) does not topple over , you will need to invest in tightening up your systems.

The goal is to create strong systems for your talented people to leverage. Sometimes, CEOs who have created strong teams miss this. For Half-Retirement to work, the people must leverage the systems, not BE the systems. Great people are a good start but are no match to strong system.

There are two options of where to start. Option one is to tackle the highest impact systems first. For instance, if you are the key salesperson and deals do not happen without you, this is where you should start. The impact of removing you from the system is significant and immediate, so big Jenga pieces first! Option two is easier because you start with some easy victories and build momentum. Examples of this might include setting a formal discounting plan or refund policy vs. the current “ask the boss” system.


Phase 7:

Create tight financial controls

First and foremost, people are not controls or systems. “I implicitly trust Bob/Mary” is a good start but a bad system. Your entire future is riding upon the financial outflows of the business, so let’s make sure your money is secure.

Some small measures can go a long way. Be sure to:


  • Spot check invoices, credit card statements and other bills every so often.
  • Have bank statements sent directly to you. Glance through them quickly. You know who your vendors are and can see when something is awry.
  • Acid test income check. We also call this “Economic Profit.” Have you ever made a profit on paper but you don’t feel any richer? That’s because all your profits are in assets/liabilities that do not add to your immediate wealth. Doing a quick plus and minus on a few key items (cash, accounts receivable, accounts payable, debt, inventory, hard assets) will reconcile your income quickly and also make fraud more difficult.
  • Trust is not a system. Repeat , trust is not a system. It’s a little lazy to trust that Bob/Mary will treat your money the same way they treat their own.
  • Here is a good article where to start if you are not an accounting pro.
  • http://accounting-financial-tax.com/2009/04/effective-internal-control-for-small-medium-business/


Phase 8:

Enjoy the spoils of Half-Retirement

You can’t simply turn off being a business owner. It’s in your blood. Your business is a long-term labor of love. However, you have done your part growing it and now it’s time to reap the rewards. The best way to accelerate the process is to try out Half-Retirement. Take a two week period and work two ½-days. A bunch will go wrong but nothing will kill the business. Take note of what happens, both good and bad, while you’re away. These are indications of which systems need fixing. Start with these and tighten some bolts. If you systemically fix what doesn’t work when you are gone, you will automatically set your business up for Half-Retirement.

Next, allow yourself to dream:

  • What if you never needed to worry about money?
  • What if you completely removed the stress of your business?
  • What if your calendar was completely open?

Part of Half-Retirement is allowing yourself to enjoy life in new ways without financial stress. Give yourself permission to let go a little.


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