Last year, I had both boys to myself. One was three (almost four). The other was one and a half.

We had a big morning planned. Zoo, lunch, then play outside.

I got them dressed, packed the stroller, and was about ready to leave. Everything felt smooth.

Then, right as I stepped out the back door, I caught the unmistakable smell: the little one had pooped.

I told my three-year-old, “Hold on. I need to change your brother’s diaper.” As I’m changing the diaper, I hear a few noises. Nothing wild, but enough to make me think, “What is the older one doing?”

Then I hear a sound I could not mistake.

The garage door is opening.

I run out, pants-less baby under one arm, and find my three-year-old climbing out of the driver’s seat of the car.

“Come inside now,” I said.

He looks at me and says, “I was just putting some things in the trunk.”

All was well, but in the few seconds before I wasn’t sure.

But that moment stuck with me, because it exposed a truth I see in small businesses every week:

A system is not a system if it only works when your best person is in the room.

YOU DON'T HAVE A PEOPLE PROBLEM. YOU HAVE A COVERAGE PROBLEM.

Most businesses have at least one “financial hero.” The person who knows what to do, where the logins are, and catches the weird stuff before it becomes a problem.

And when that person is present, things feel stable. Invoices go out. Payroll clears. The books get closed. The numbers look “fine.” It can feel smooth enough that you assume you are safe.

If you have a smaller business, this is even more common. Your “best person” might be you, an office manager who knows the entire back office, a bookkeeper who has been around forever, or an outside firm that “handles it.” None of those are bad. But if one of them is the system, you are one weird week away from a cash surprise.

THE THREE-HAT RULE (START HERE)

So, how do we fix this? We create overlap in jobs. Think “full coverage” not org chart. Org Chart tells you who does what job, but not who covers or backs up a job.

In accounting, especially, it’s important that if you have someone doing invoicing who goes out for two weeks, invoices don’t start. That, and other primary accounting functions, can quickly turn from “we’ll handle it when they get back” to “we have no cash and can’t make payroll.”

So when thinking of each job in accounting (and even anywhere in the business), think in terms of 3 roles or functions:

1. PREPARES
2. APPROVES
3. RECONCILES

In a small business, one person may wear two hats. That is normal.

But if one person prepares, approves, and reconciles everything, you have major problems. Not only from a “coverage” front, but also from a fraud front. If someone prepares, approves, and reconciles, they’re set up to easily commit fraud.

When we think someone isn’t capable, that’s when we’re most exposed.

But back to the coverage, different roles for different people matters for a few reasons:

1. It projects you from someone leaving or being out
2. It helps ensure the timing (and provides accountability) of the completion of the job
3. It creates a feedback environment to improve the process of doing the job

These three roles help you get away from the “good people will take care of it” mentality and transition to a real business with systems.

HOW THIS SHOWS UP IN THE CYCLE (A QUICK REMINDER)

If you read our recent article on the accounting and finance operating cycle, you already know the stages.

What I want you to see here is how “people-as-system” breaks the cycle in predictable places, especially when one person is wearing all three hats:

• INPUTS: reality does not get captured consistently (coding rules, commitments, accruals, exceptions).
• CLOSE: nobody knows what “done” means, so the close drifts and quality slips.
• ANALYSIS: the team debates the numbers instead of learning from them.
• DECISIONS: meetings end with “we should research…” but no owner, no deadline, no follow-through.
• FEEDBACK: decisions are not tracked long enough to learn, so the same problems repeat.

That is why the goal is not “better reports.” The goal is a finance function that can run without heroics.

I think about people (internal or external) through two models: support and substitute.

A support model is when a person supports the system. They make it run better, faster, and cleaner, but the process is still owned by the business.

A substitute model is when a person becomes the system. Things “work,” but only because they are present. When they are gone, the business does not have continuity.

This is where outsourcing can be misunderstood. Owners will say, “We outsource it, so we are covered.”

Sometimes you are.

But you cannot completely outsource understanding, because the company still has to approve money, reconcile reality, and notice when something feels off.

You are running a substitute model (internal or external) when:

• access lives in one inbox, not a shared vault
• rules are not written down, so things change month to month
• the close happens “when we can get to it,” not on a cadence
• exceptions get resolved by memory instead of by standard
• nobody inside the company can run the basics for two weeks

I’m not anti-outsourcing, as hey we help people with that! But you need a good partner and who doesn’t say “we got this, don’t worry” but instead says “we got this, but we’ll create a system that informs and educates you too.”

The goal is not “someone else does it.” The goal is that the business can run this function without heroics.

THE 2-WEEK COVERAGE SPRINT (A PRACTICAL WAY TO BUILD DUPLICATION)

A lot of owners read something like this and think, “I get it, but I do not have the bandwidth to build a full finance department.”

Good. You do not need that. You need minimum viable redundancy.

The goal is not “no risk.” The goal is “no single point of failure.”

In a small business, that might look like one person who runs the process, one person who can run it 70% as well when needed, and enough documentation that the second person is not guessing.

This is the simplest way I know to build coverage without turning it into a big project.

This can also be overlap passed among just 2 or 3 people (internal or external) but passing from one to the other, then back to the one.

So, let’s talk about the process of working on this.

WEEK 1: MAKE IT VISIBLE

Start by listing the core money flows: billing, A/R, A/P, payroll, reconciliations, and reporting.

For each one, answer one question: If this person is gone for two weeks, what stops first?

Then write down what “done” means for that flow (one sentence). Not a perfect SOP. Just the definition of done.

Finally, write the minimum standard: what we always do, what we never do, and what triggers an exception.

WEEK 2: MAKE IT RUNNABLE

Now package it so someone else can actually execute it.

Create a simple “finance home base” (one page or folder) with:

• the checklist
• the recurring schedule
• where the documents live
• where access is stored (in a vault)

Then record 3 to 5 short Loom videos for the most critical tasks (invoicing, payroll, paying bills, reconciling, and pulling the weekly cash snapshot).

Assign a backup person next to each process, then think about a person for each of the three functions:

1. Prepare
2. Approve
3. Reconcile

The backup can be the approver and the preparer can be the reconciler (if the reconciliation is also approved). It’s not ideal, but in small teams it can be huge.

Even 70% competence is a win, because you are not trying to be perfect. You are trying to be resilient.

If you don’t have the right team internally, look for an external resource. Paying $1-3,000/month for controller-type duties seems expensive, but I’ve seen businesses get millions stolen from them over 10+ years because they didn’t want to pay.

Frankly, it’s just a cost of doing business and protecting yourself.

COVERAGE OVER PEOPLE

We still made it to the zoo that day. No disaster happened.

And that is exactly why this is so easy to ignore. Small failures often have no immediate consequences. So owners stay asleep. Until the failure is big.

This week, pick one process and make it survivable without your best person.

Start with invoicing or payroll, because cash and trust matter most.

Good people are a gift, but a business that depends on one good person is a fragile business.

Build coverage.

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