Employees are often both our largest cost in business as well as the most important asset to effectively manage. As any business owner knows, the management of this important asset is one of the most complex aspects of running a business. I recently heard Rand Fishkin speak about the difficulties of management in a technology start-up and realized the principles he was working on in a fast growing start-up were the same as what we deal with in the RV and Marine industries on a regular basis. Some business problems are the same, across all industries and it made me want to know how others have dealt the age old problem of how to best manage a team of smart, hard working people in order to get maximum efficiency and profitability for our businesses.
Hiring the right person for the company, the job and the existing team
As a manager there are few things more important than hiring the right people for my team. I often hired based solely on an applicant’s experience and ability to do the job. I didn’t take things like company culture, personality fit and future goals of the employee and department. There was a hole to be filled and I wanted to fill it with someone that could do the job. I now see what a short sighted mistake that was and how building a team involves a lot more than just someone’s skill level. As a matter of fact, that probably isn’t even the most important trait when building a team. Skills can be taught. Things like attitude, teamwork, and work ethic are much harder to ingrain in someone that doesn’t naturally have them.
Hiring well takes a asking a lot of hard questions, both of the applicant and yourself. What traits are the most important for the growth and well being of your team, department and business? Are you hiring the person that has both the most competence and is a cultural fit?
We have all experienced different versions of these types of employees. They are characterized as the person that works long hours, they appear totally stressed out and seem constantly overworked. Not particularly what I would call “the ray of sunshine” in the department but management typically considers them valuable because of their experience and history with the job. Discounting the drain on morale and culture someone like this can have on an organization, they are often promoted or favored because of how much they work.
Let’s contrast that with the employee that isn’t necessarily the most productive team member but brings a strong positive energy to the team. Customers love them, team members enjoy working with them and teamwork comes naturally. How do you value this type of employee? It certainly can’t be tied to the amount of dollars that person produces for the organization.
Rand showed this graph during the presentation that demonstrates the different culture and competence factors.
At Exuma we have talked about company culture before and the importance that some forward thinking companies are putting on it. Do you know what your company culture is? Is it something you have written down and have made readily available to everyone on your team? I have found there is always a culture, whether or not it is being tended to and molded by the business owners is another matter.
Promote the person that is best at their job, duh!
Another common sin I committed in my management history is to assume that because a certain technician was killing it on the line, had the best efficiency, the least come back rates and the greatest work ethic, that they would make a fantastic supervisor. Let’s pull them off the line, lose all of their money making productivity and have them manage 10 other guys. I swear this sounded like a perfect plan at the time.
Another unique point of view on the topic came from Dr. Laurence Peter, who wrote The Peter Principle: Why things go wrong. In a radical statement of the times, Dr. Peter outlined the belief that in a hierarchy every employee tends to rise to their level of competence. Meaning, an organization will continue to promote a good employee until they are in a position that they are incompetent for.
The salesperson that is so great at their job they are promoted to Sales Manager, where they know how to close a deal but have no idea how to mentor other sales people. I have personally made this mistake in a dealership and promoted a salesperson to their level of incompetence.
This has been done time and time again within businesses because when an employee is doing great at their job, everyone (both the employee and the business) assumes the next step is to promote them to management. A great employee does not automatically translate to a great manager. The employee may not even want to move into management but feel that they must to avoid hitting a ceiling and being stuck in a dead end job. According to the author Daniel Pink, when asked “What makes us happy at work” most people responded with: 1. Autonomy – the desire to direct our own lives. 2. Mastery— the urge to get better and better at something that matters. 3. Purpose — the yearning to do what we do in the service of something larger than ourselves. If you take away the opportunity to progress with any employee, they will lost motivation to the do any meaningful work anyway.
If you keep Daniel’s three points in mind, you should be able to design a system that rewards both those employees with leadership skills destined for management, and those that want to hone their skills and perfect their craft, whether it’s repairing boats, selling RVs or tackling challenging accounting issues. With this in mind you can map out a career for your team members that will allow them to grow and advance in your company without losing productivity.
Are you having this conversation in your business? How are you approaching it? Please comment below.