Single Points of Dependency quietly cap growth and depress valuations. My blog post this week explains where they hide, why they harm scale, and how to start fixing them. It's practical, frank, and built for leaders who want stronger, more valuable businesses ...
Single points of dependency, Fragile and precarious, One crack, all crumbles
Every growing business faces a quiet constraint: Single Points of Dependency. They appear to be high-performance and admirable commitments on the surface, but beneath that shine lies a structural risk. When critical knowledge, decisions, or relationships are concentrated in one person, the business loses control of its own momentum.
It becomes exposed to the limits of that one person's capacity, and their intent to stay!
The pattern appears everywhere. In early-stage firms, it is often the founder, whose fingerprints are on every decision and whose approval becomes a hard gate in every workflow. In established SMEs, it is:
The operations lead - who knows how to make the machine run under pressure,
The technologist - who built the core system and remembers every undocumented quirk,
The sales director - who carries the revenue number via personal relationships,
The finance manager - who alone can decipher the spreadsheet logic behind margin.
None of these roles is the problem; the concentration of knowledge and authority is.
The cost shows up long before anyone leaves. Growth stalls, not from a lack of demand, but from an inability to fulfil it without burning out the person holding the keys. Projects drag because sign-off sits with someone who is already operating at capacity. Quality wobbles because only one individual can close the gap when processes fail.
Decision latency becomes the norm, and the organisation shifts from planned scaling to perpetual firefighting. Opportunity cost compounds quietly in the background while competitors move faster with broader benches.
Investors and acquirers see this instantly!
And this is why they ask a blunt, yet straightforward question: What happens if your top three people walk? If the answer is that revenue dips, customers notice, and critical processes pause, valuation drops accordingly.
Fragility increases risk, which in turn pushes down the price. A business that relies on a few indispensable people is challenging to diligence, expensive to insure, and slow to integrate. A business that runs through repeatable processes, shared knowledge, and clear accountability earns a premium.
Where, exactly, do these Single Points of Dependency hide? They hide in undocumented processes that live in heads and inboxes rather than in systems. They hide in bespoke tools that only one person can maintain. They hide in sales pipelines that are really personal networks, not institutional relationships.
They hide in approval chains that default to “Ask Sarah” or “Check with Raj” because no one else is trusted, trained, or authorised. They hide in file naming conventions, in unshared vendor nuances, in tacit ways of handling exceptions that never make it into the playbook.
The operational risk is matched by a strategic one. Leadership attention gets swallowed by escalation, not scale. When the same names appear on every critical path, the leadership team cannot free cycles to build the next capability, explore adjacent markets, or fix upstream constraints. The firm becomes present-focused, not future-proof. It stops compounding.
Tackling Single Points of Dependency is not a witch-hunt; it is an architectural upgrade!
We first need to move from heroics to design. Start by mapping critical outcomes rather than job titles: revenue protection, customer fulfilment, cash control, platform stability, and regulatory compliance. For each, identify the specific decisions, approvals, and knowledge assets required to deliver consistently. Then quantify the concentration: who can perform the task today, who is enabled to back them up, and what would break if they were unavailable for a week, a month, or a quarter.
From there, make risk visible and tractable. Codify the work with lightweight, living playbooks that capture the 80% standard path and the 20% exception logic. Move scattered knowledge out of personal inboxes and into shared systems with version control and access logs. Liberate key approvals by defining thresholds, guardrails, and delegated authority, so decisions occur at the right layer without creating a free-for-all. Build cross-training into BAU rather than waiting for absences to force it; redundancy should be routine, not a scramble.
Technology can accelerate the shift if applied deliberately!
Replace fragile spreadsheets with governed data models. Wrap homegrown tools with documentation, monitoring, and automated tests, or sunset them in favour of supported platforms. Dashboard core processes so leaders see flow, blockers, and error rates in real time, not in retrospective anecdotes. Automate processes where repetition and rules dominate, ensuring that the automation is documented, observable, and owned by multiple individuals.
Commercial resilience matters as much as operational resilience. Institutionalise relationships by anchoring them in teams, not individuals. Ensure multiple touchpoints exist for key accounts, with shared notes, clear service histories, and transparent renewal mechanics. Tighten contracts, protect IP, and include sensible non-solicitation and notice periods, but never mistake paperwork for continuity; process and capability are the real safeguards.
Culture either fixes this or perpetuates it. Celebrate the transfer of knowledge as much as the closing of a deal. Reward managers for building benches, not empires. Expect leaders to design themselves out of day-to-day bottlenecks and into higher-leverage work. Make it normal to ask, “If you were unavailable for two weeks, what would stall, and why?” Then remove the reasons. The best people amplify impact by making others effective; they do not hoard control.
None of this requires bureaucracy. It requires clarity. Decide what only a few should do, what many can do with the proper guardrails, and what should no longer be done at all. Shift work to the lowest competent level, make quality visible, and use post-incident reviews to update playbooks in hours, not months.
Make risk reduction a weekly cadence, not an annual initiative!
The question to hold is simple: if a key person walked out tomorrow, how much capability would walk with them, and how long before customers felt it? If the honest answer is, “too much and too soon”, then the path forward is equally clear. Start mapping, codifying, delegating, and strengthening the architecture.
The outcome is a business that scales faster, fails safer, and commands a higher valuation precisely because it is not beholden to single points of dependency.
Until next time ... STEPH BIRCH Founder & Transformation Catalyst
Would you like to know more?
If anything I've written in my blog post resonates with you and you'd like to discover more of my thoughts about building out single points of dependency to help your business scale efficiently, then do feel free to connect with me on Linkedin or call me on 07772 588024 and let's see how I can help you.
With over 17 years of hands-on experience, Steph is that rare unicorn who’s done it all - and done it brilliantly. From transforming scrappy contact centres into high-performing hubs, to leading full-scale functions across finance, tech, product, data, compliance, sales and more - she’s scaled it, fixed it, or rebuilt it from the ground up.
Steph’s superpower? Blending big-picture strategy with sleeves-up execution. She’s led operational strategy at board level in industries like Insurance, SaaS, Tech and BPOs — and knows how to drive results whether she’s supporting a scrappy founder or steering a complex enterprise. She’s passionate about people, powered by data, and obsessed with making operations smoother, smarter, and future-ready.
Are you ready to go from firefighting to future-focused, without losing the heart of your business?
Operational clarity is essential for any growing business. A fractional COO not only implements vital processes, but also clarifies roles and responsibilities. This leads to measurable progress and reduced burnout among team ...
Cracks That Cost You Millions are avoidable. Fix clarity, finances, and operational delivery before scaling. Do that, and SME growth becomes profitable, not painful ......
Here's a DIY business health check to surface real bottlenecks fast. Skip the theatre and find the friction. Every growing firm needs a clear view of reality, and a DIY business health check gives leadership exactly that ......
Here's the honest take on what to do when growth gets messy. Upgrade operations, make informed rebuild decisions, and protect your margins before chaos prevails ......
How can a Fractional COO transform operations for scaling organisations? In this blog post, I'll explain how they can help leaders gain a pragmatic roadmap for their business ......
Map what matters, make risk visible, delegate early, upgrade tools, and spread commercial exposure. These moves cut single-point risks in SMEs while strengthening business continuity, cash flow, and customer trust. Turn fragi...
My blog post this week explains how addressing tech debt transforms fragile operations into scalable growth. It outlines foundations for ownership, testing, integration and communication. UK SMEs can reduce risk, cut costs an...
Established businesses struggle when growth arrives because informal systems, founder bottlenecks, and cultural inertia collide with new demands. Without structure and visibility, risk multiplies. The right shift brings proce...
Blogging is a missed opportunity for many small business owners. You may worry you lack the time or expertise to do it effectively. With sBlogIt!, the ...
The usual question I see asked in bookkeeping groups and forums is, where can I find customers, or how can I get experience now that I have passed my ...
Curious about the HMRC R&D tax relief tool? Here's how it clarifies eligibility, reduces risk, and supports better claims. It's a pragmatic boost for ...
Here's why serviced accommodation in Milton Keynes is a smarter choice than a hotel. Expect more space, better Wi‑Fi, and the freedom to live on your ...
