“Hire for attitude and train for skill.” People are motivated by many things besides money. The owner of a Healthy Bouncy Business knows that attracting and keeping the brightest employees involves creating a work environment that allows them to develop and grow. Giving extra special attention and building solid relationships with your staff will keep them engaged and motivated to do their best at work.
The 7 Habits of Highly Chilled Small Business owners
This is the fifth article in a monthly series on small business owners I have met or worked with over the years who developed beautiful successful businesses.
Stories of successful real business owners
In 35 years of doing business and working with some of the most inspiring people I’ve ever met, I’ve learned a very important lesson: Success in small business starts by building great habits. I call these practices the “7 Highly Chilled Habits” and I find they’re best illustrated with the stories of real business owners who I happen to have had the pleasure of coaching.
The articles are based on my E-book, The 7 Habits of Highly Chilled Small Business Owners. All of my books and other resources are available for free here
Highly Chilled Business Owners Find the Best Person for the Role
In order to build a Highly Chilled business, you have to put great people on your team, give them every opportunity to shine and remove the ones that don’t fit.
Small business owners often lament the fact they can’t afford to hire great people because big corporates have so much deeper pockets. They also often complain that managing people (especially millennials!) is a nightmare because they think the world owes them a reward for turning up and as soon as you’ve finished training them, they leave again.
It’s true that finding, hiring, engaging and keeping good people is the hardest thing you’ll ever do in your business.
But it’s meant to be hard because employing people is also your greatest opportunity to build a Highly Chilled business that makes money. And generally, in business (as in much of life, I suppose), the hardest things are where the greatest opportunities lie.
Be Careful, Like Adrian
I know lots of business owners who have struggled with employees their whole life. I’ve also met a bunch of them who get it right. Adrian is one of those people.
Adrian owns a Highly Chilled retail design, development and store fit-out business in Sydney. This is his website. Things have been going incredibly well for Adrian since he started his business in 2010. He employs around 30 people and half of them are young millennials. They come and go, get paid the industry average and have their good and bad days. But they deliver. The culture of the place is buzzing, and they make lots of money for Adrian and his business.
Adrian’s secrets are simple:
Hire the best people, not just the ones you can afford.
Hire for cultural fit AND skills/experience.
Set high expectations.
Give everyone lots of encouragement and genuine personal attention.
Get rid of them early if they don’t work out.
A couple of years ago, Adrian’s business had grown to the point where he needed a general manager. The temptation was to promote someone internally to the role. That would have been the easy, economical solution.
However, he was aware of the Peter Principle that says: “People always get promoted to one level above their ability.”
And Adrian needed someone with experience in fast-growing national and international business.
The answer was clear. The person in the business he’d considered for the role didn’t have GM experience and although a great team member, promoting this person was not what the business needed. Adrian actually knew exactly the person he wanted to have on board, a good friend, but she had a high paying job at one of the biggest corporates in Sydney (with all the perks and trappings of corporate success). What could he offer to entice her away?
She Jumped at the Opportunity
Long story short, Adrian took his friend to lunch, took the plunge and matched her corporate pay. He also offered her other financial benefits and options in the business down the track. The friend jumped at the opportunity, and they’ve been working together for 3 years with great success.
Your business is only as strong as your people. Hiring someone based on whether you can afford them, or because they happen to be there already, is a recipe for stagnation.
Adrian’s is a Highly Chilled business and Adrian is a Highly Chilled small business owner.
Your Homework (The Chilled Kind)
Here’s a short exercise you could carry out to start the process of making this habit your own.
Practice Highly Chilled habit #6:
You may not currently need to hire someone, but the next time you do need to find a new employee, resist the automatic temptation to consider promoting someone you already have on the team. First, take some time to visualise the person you’d ideally like for the role.
Are you a small business owner who’s feeling the heat? Explore Highly Chilled habit #7 as soon as it is live on my blog here
And the hard hitting truths about business management
Would you like to move out of overwhelm and start building a Fun Business that sustains you for years to come? The truth is that once you’ve laid the foundations (using the Hedgehog Principles), it’s all about learning to manage your Fun Business properly.
I won’t lie, you will need to focus on a few fundamentally dull things, small business management in other words, like goal setting, team management, planning, systems and measuring. However, I have a few shortcuts and strategies up my sleeve that make the process markedly more exciting…
A Fun Business Has Flexible Goals
Everyone knows that goal setting is a good idea. It engages your team. It improves your decision-making. It helps your business deliver on its promise. What’s more, I don’t believe your business will ever become Fun if you don’t practice goal setting effectively. To manage your business well, to build a great Fun Business, you simply can’t avoid Goal setting.
Still, goal setting is surprisingly difficult to do well. It’s hard to get people onboard. It’s even tougher to keep everyone accountable. Our world is also changing every day, so goals must be continuously adjusted to suit new realities.
SMART is a well-established tool for creating impactful goals:
I like the idea, but I believe that adding three more letters to the acronym makes it exponentially more powerful:
S tretch (you can just see yourself reaching for it)
I nspiring (for you)
P ersonal (about your personal achievements and growth. Read: not about achieving a particular profit level or buying a Porsche because unfortunately, those material things won’t motivate your subconscious brain!).
I always invite my clients to decide on a large, visionary goal for the future (Jim Collins refers to this as the BHAG or “Big Hairy Audacious Goal” in his book, Built to Last) that meets the SMARTSIP criteria and then break it down into a medium-term goal and a goal for the year.
A Fun Business Engages Everyone
Lots of businesses proclaim that their people are their greatest asset (and to be honest, whenever I read that statement on someone’s website, I run a mile), but most of them generally belie their beliefs with their actions.
Most companies prefer not to think about the fact that a business IS its people, and your business only gets to make money if your people let you. Business Management is about people first and foremost.
If your employees are only interested in their paycheck, you will always struggle to make a dollar and business will feel anything but FUN. On the flip side, if your whole team is enthusiastically pulling in the same direction then your business will move mountains.
So, how can you achieve said nirvana?
Hire the brightest: Find people whose attitude, energy, enthusiasm and resourcefulness matches your culture and team dynamics.
Move beyond money: Listen to people, recognise their achievements and give them the right tools to do a meaningful job well.
Get the team involved: Bring your people into all the processes, planning meetings and rhythms of the business.
Remember that employees are people too: Don’t just dictate – get people involved in developing their own goals.
Play the game of business: Get your people to start thinking like team members who are playing a game that they all enjoy and want to win.
A Fun Business Has a “Living” Business Plan That Drives It Forward
Human beings don’t accomplish anything without a plan. In fact, some say it is our ability to plan that sets us apart from other animals. However, most small businesses do not have a formal business plan, and if they do, it generally lives in a dusty bottom drawer.
Having a written plan (AKA one that exists outside of your head) allows other people to engage with it and understand where the business is going. It allows you and others to check progress, brainstorm, make good decisions and maintain focus on the important stuff.
Most business owners know this. I’m sure you do too.
The sticking point comes from a simple misunderstanding. It comes from believing you are expected to develop an externally focused plan in the format we are taught by accountants, consultants and government bodies (read: not designed to be useful for you, the owner) when an internal business plan is what you need.
An internal business plan is a shareable and succinct “living” document. It is created collaboratively and revised frequently. It is designed to support decision-making and internal communication about the direction of the business.
Trust me, once you let go of your idea of what a business plan “should’” look like and just get around a table with a flip chart and a group of your people, you’ll find that business planning is not actually daunting at all, but instead really powerful and Fun.
A Fun Business Has Rhythm and Regularity
Entrepreneurs are the busiest and most guilt-ridden people on the planet. They work long days, dream about their businesses at night and repeatedly scorn themselves for not living up to some impossible standards laid out by a critical inner voice [HYPERLINK TO BLOG POST 1].
As a result, most business owners operate as crisis managers. This situation has many undesirable consequences: dropped balls, neglected business development, burnout, missed family time, stomach ulcers, or all of the above. An atmosphere of stress and last-minute problem-solving also starts to develop company-wide, leading to low morale and high employee turnover. You get stuck in a loop where you don’t have time to foster predictability, develop systems or train people to handle the crises themselves and because of this, there will always be another crisis.
The way through this dilemma? Building rhythm and regularity into your business.
One of the best first steps you can take is to start a weekly operations meeting where everyone reviews the previous week and plans for the next one (a better one). Want to make it effective? Start and finish on time. Follow an agreed agenda. Ensure everyone is present. Don’t allow distractions. Focus on solutions.
Next, you might decide to look at the systems in the business because systemisation is an important contributor to a sense of calm predictability. This could be as simple as creating a script and a standard form/checklist for inbound office calls.
Remember, people want to feel safe, and safety starts with knowing what the future holds.
A Fun Business Measures the Fun
Beyond the most obvious measurements, every business has different priorities. However, there is one key measurement that all business owners should consider starting with: Fun.
Fun is the only success factor that cuts across and influences every aspect of business.
One of the reasons Fun doesn’t usually get measured is that most people believe you can’t because it is intangible. But you can measure intangibles such as Fun. Quite easily and accurately as a matter of fact.
Let’s say you asked your team every Friday afternoon to give an anonymous rating on your Fun in Business scale from 0 to 10, with 10 being the most fun you’ve ever had in business and 0 being the opposite. Next you collate and average those numbers and come up with a single “Fun number” for the week in business.
You could then have a staff meeting every Monday morning and share last week’s Fun number, asking the team what you could all do to get the number just a couple of points higher in the coming week.
The first few times you do this, your team will make silly suggestions about doubling their wages and paintball outings because it is all such a novel idea. However, I guarantee that soon enough it will become obvious to everyone exactly what real business Fun is all about and you will start having practical, productive conversations that make exciting things happen.
Your Homework (The Fun Kind)
Here’s a couple of steps you might take in the coming week(s) in respect of each of the management truths:
For Goal setting:
Thinking about the SMARTSIP structure I describe above, pick a date, ideally no more than a year from now and no less than 6 months away ad create a Goal (or set of Goals) for you and your business that inspires you and is both a stretch, yet achievable,specific and measurable and meaningful to you personally and motivating for your staff
Create a rough draft monthly plan for achievement of your Goal with monthly milestones
For your team:
Get your team involved. Organise a meeting with your team and introduce the Goal and draft plan to them and work with them to firm up the plan
Assign specific tasks from the plan to team members or groups of team members
Agree on monthly meetings with your team to update the plan, and agree on next months actions and responsibilities
For your business plan:
Incorporate your Goal in a longer term plan. Where do you want your business to be in 5 years, what is it going to look like, what is its focus, how big is it, what new developments have taken place.
On your own or with your team (or part of your team) create a SWOT and create actionable targets to address the top 3 items from each of the sections (see more about SWOT here and also here )
Start by blocking out a small amount of time each week for yourself (as little as an hour each week or as much as you can manage), to do nothing but think and plan and develop new ideas. Phone off, can’t be disturbed, go off site to a cafe if you need to make sure you’re not disturbed.
Implement a weekly half hour meeting with your staff to set up the week… Celebrate the wins from last week and plan to have more wins this week. Make sure it’s quick, efficient and doesn’t talk about why certain things went wrong last week, simply acknowledge the things that went wrong and focus on making sure things go right this week instead.
For measuring the Fun:
In your weekly and monthly meetings, start by asking everyone for one small tiny little thing they can do themselves to mak the week ahead more Fun
In your weekly and monthly meetings ask the staff for one thing you can do to make business more fun for everyone in the week ahead
This is the eighth post in the series of The Ten Priorities: Laying the Foundations for a Great Business and Life. The eighth Priority is about Managing your People. The introduction to this series on The Ten Priorities is here.
As seen on Kochie’s Business Builders
Great businesses employ great people that deliver great work.
Business owners who want to build great businesses must get good at managing people. There is no way around that.
But for many business owners, people are a source of great stress and anxiety. They spend their days hoping things will go ok, and practice the ancient art of:
Management by keeping your fingers crossed
And that’s because they Abdicate, instead of Delegate to their employees.
Abdicating is giving someone a job and hoping they’ll somehow get it done right.
Most people feel good when they have an opportunity to do good work. Human beings (and employees are in fact human beings, I promise you) get a lot of satisfaction from doing good work, but the problem is, they often don’t know what constitutes good work. They’ve not been given clear outcomes, and they’re given conflicting priorities and feedback. And so, they flounder, they make it up themselves, they disengage, and the job does not get done right.
Delegating, on the other hand, is about discussing the job with the employee; explaining to them what the required outcomes of the job are; making it clear what good work looks like; asking for input and buy-in on the job; asking what the person needs to be able to deliver the required outcomes; agreeing on time frames and check-in points, and finally, agreeing on reporting and KPI’s for the work. (More about engaging your staff here)
When you learn how to delegate while keeping your fingers on the pulse as opposed to keeping them crossed, you will start to build a great business… I promise you.
Growth is the most enduring topic of the 7 big questions of small business. There are literally thousands of business growth strategies bandied about by business experts and gurus. Every business owner that ever was has felt frustrated and stuck at some stage while wondering how they can grow their business to the next level. Which are the growth strategies that are going to work for your business?
This page lays out the 11 most important strategies to grow your business to where you want it to be. All of the 11 growth strategies are solid and proven, it’s up to you to mix and match. It’s a bit like baking a cake. Most cakes have eggs, flour and sugar in them, but you can’t make a cake just with flour or with nothing but eggs, you need a mixture of ingredients. So it is with building and growing your business. You may not need all the 11 business growth strategies, but you certainly need a mixture of them.
So … Get yourself to the kitchen and bake something beautiful.
Everybody’s favourite business guru, Seth Godin, once summed up the solution perfectly:
“To build and grow a great business, you really only have to do two things:
If you want to grow a beautiful business that stands the test of time, you must be able to answer the question: Why does your business exist and why would anybody care?
Most business owners can’t answer that question succinctly and powerfully. That’s bad because:
If you don’t know why your business exists, your customers certainly won’t either and that makes price the only differentiator. Competing on price is a dog’s game (unless you’re Aldi, where price is your purpose).
If you don’t know where to focus your energy, you will never master the greatest skill of effective business owners: the ability to say “NO”.
We’ve all heard that the first step towards business growth is goal setting. However, effective goal setting is more complicated than you might initially think.
Most of the goals we set for ourselves are ineffective at best, and at worst, actually hinder our progress. They’re often arbitrary, unrealistic and unrelated to what truly matters in our lives.
For instance, a goal to make $2 million revenue is meaningless. Why $2 million? Why not $1,956,384.13? And what happens when you reach that goal? Will you be better off somehow? What if you fall short by $100 or even $100,000? Does that mean you are a failure? Goal setting only makes a difference if you understand that goals are like a compass; they provide a direction on your journey, they are not the destination.
Marketing is about creating opportunities to sell your stuff. As such, I fervently believe that:
“Marketing is everything and everything is marketing.”
That’s why, if you want to grow your business, you must analyse every aspect of your business.
Yes, marketing is about branding, advertising campaigns, social media and your website, but it’s also about how you answer the phone, your pricing policies and ensuring your customers are happy with what you sell them. It’s about how you dress, how you present your quotes, your PR strategies and your warranty return policies.
In fact, one of the most powerful marketing strategies is maintaining a relentless focus on quality in everything the business does in order to create “raving fans”. Why? Because if your customers are all raving fans, they will do your marketing for you.
I don’t mean to imply that digital marketing is something wildly different from all other forms of marketing. However, it is useful to pay special attention to the online space because it has become such a critical component of any growth-driving marketing strategy.
Whether your business serves food, builds houses, crunches numbers, imports widgets or makes whatsits, you can’t ignore digital marketing activities, like email marketing, content marketing, social media and influencer/affiliate marketing, search engine optimisation (SEO), pay-per-click advertising (PPC) and online PR. The list is almost endless and constantly changing with emerging technology, such as artificial intelligence, voice search, chatbots, virtual reality, drones, and progressive web apps.
You could easily argue that the core principles of marketing haven’t changed, we’ve simply got a bunch of new tools to use. At one level that’s true because people still want to get to know, like and trust you before they will do business with you. However, on another level, things have changed drastically.
Ten years ago, you’d give someone a business card with your web address on it and they would immediately want to know if you also had a bricks and mortar store. These days, people want to know you’ve got a high-functioning, active web presence, including a Facebook and Instagram page, a Google My Business listing and ideally, a bunch of 5-star ratings on all the major review platforms.
The reality is, often your physical presence doesn’t even matter anymore. If you want to be taken seriously today, online engagement across all mediums and channels must be at the heart of your marketing strategy.
That’s a quote I once saw hanging on the wall at a big office. And it’s true. You won’t achieve any business growth (or even have a business!) without sales. No matter how great your product is, how beautiful your logo is, how smart your website is or how wonderful your employee culture is – if you’re not selling, your business will cease to exist. Simple.
Sales is often seen as a subset of marketing, but I’m giving it a solo section because I think of marketing as getting the customers to your door and sales as getting them to hand over the money. Lead generation vs lead conversion.
Sales is about skill, mindset and systems, but above all, it’s about making things easy for people. And that last word is the key to the whole shebang: it’s always about people. The old saying goes:
“People do business with people they know, like and trust.”
It’s especially important to remember this in small business because people do business with people. Your entire approach to sales must be built on a people-to-people philosophy.
“A business without a plan achieves everything in it.”
Nothing in other words.
Your business growth depends on planning. No human endeavour ever amounted to anything without a plan. Yet planning is guessing. It can never be anything more than guessing, because we can not know the future. So if planning is guessing, why does it matter so much and how can we do it so it works? There are two important answers to those questions:
You must understand that there are two entirely different types of business plans: internal plans and external plans.External plans are designed to impress others about your business. They form part of the documentation to obtain a loan (or other type of funding) or make a proposal to a third party. Internal Plans are designed to help the business focus. They are drawn up using meaningful goals (see above), and they help people with their day-to-day decision-making processes.
Planning is a verb. It’s not static, it’s an activity that never stops. As soon as one plan is created, we start again.John Lennon once said, “Life’s what happens when we’re making other plans,”. Planning is like that. We make a bunch of assumptions and map our actions accordingly. Next, we check reality as it unfolds and make changes to suit those new realities – every day, every week, every month and every year.
The bottom line? Business plans that truly work and make a difference are living documents.
Customer service is also a subset of marketing, and if done well, it leads to more business from those customers (plus, as I said above, everything is marketing and marketing is everything). However, it’s worth mentioning separately because of the concept of “raving fans”.
Ken Blanchard wrote a little book called “Ravings Fans” that talks about how your business should always be working to do one better for your customers than they expect. If you do so successfully, your customers will become advocates that go out of their way to help your business grow. They will talk to their friends about you, drag their colleagues to your door, defend your business against the competition and best of all, they won’t quibble about the price. If you focus on turning your customers into raving fans, you will ultimately be able to slash your marketing budget in half and achieve a long-lasting competitive edge.
8. Grow your business with systems and quality improvement:
My clients often ask me to help grow their business and I often tell them to stop worrying about that. Getting more customers is the easy part. The hard bit about business is delivering what you say you will by the time you say you will for the price you say you will at the quality you say you will… with a smile!
If you can do that all the time, even as your business grows, then customers will come flocking to your door and you won’t need to spend much money on marketing (largely because you’ll be creating raving fans !).
I can’t tell you how many businesses I have seen struggle and fail because they couldn’t maintain their product/service quality, dependability and price once they scaled.
When your business starts to grow and you are no longer in charge of every step in the process, things often start going wrong. Quality becomes inconsistent, delivery times become unreliable, prices go up or profitability suffers – and your smile disappears. Once the rot sets in like that, your reputation nosedives and customers begin to look elsewhere.
There are only two answers to this dilemma:
Stay small: Don’t grow and learn to say “NO” often.
Systematise: Develop systems for all aspects of your operation, including estimating, quality checking, calendar management, inventory management, callbacks, warranty repair, marketing, hiring, firing and even how the phone is answered. Systems allow you to create continuous improvement loops in your organisation (and that’s the Holy Grail of business. It’s what made companies like Toyota great).
Inventory management is a big, specialised topic. It’s really a subset of the systems section above. There are whole management libraries written about the various philosophical approaches to managing stock when building and growing a beautiful business that stands the test of time.
My earliest inventory management lessons came from Colin, the owner of a large hardware store who I dealt with a lot during my days as a builder. One of the reasons I bought so much of my material from Colin was that he always had everything in stock. Colin clearly knew what it took to create business growth because his business was booming.
I once asked Colin if keeping such high stock levels of everything that a builder might need from time to time was economical for him. I imagined that it was a very expensive way to run a business, having all that money tied up in timber, hardware and bits and bobs. His answer was:
“If I don’t stock it, I can’t sell it.”
I have often thought about that statement, particularly now that most operations run on the principle of “just in time”. Supermarkets have made an art form of stocking just enough and not a jar more than required in order to minimise shelf space and inventory cost.
I don’t know what the answer is, but I do know that Colin got all my business for 20 years and most Sydney builders had an account with him because everything we needed was always ready to collect.
10. Grow your business with hiring, firing and engaging people:
In his famous book “The E-Myth”, Michael Gerber wrote that it is impossible to manage people, so great businesses focus on systems and manage those instead. That’s certainly what grew McDonald’s into the enormous business it is today. And as I’ve written elsewhere before, if you set out to make as much money as possible from selling restaurant food, it is undeniably the case that the McDonald’s model is the one to emulate (that doesn’t mean I like it!). This philosophy can be applied to any industry.
If you’d like to build and grow a unique business, a business with an individual character, you’re going to have to manage people. You’re going to have to get good at putting the right people on the bus, sitting in the right seats, facing the right direction while also knowing which others should get off. If you don’t learn how to find (and keep!) the right people and get them to do great work, your business will always struggle. That means:
Developing strategic hiring policies
Being prepared to employ people who might be better than you at certain things
Learning how to conduct great interviews
Implementing meaningful induction and development training programs
Learning how to coach, encourage and hold your people accountable
Getting better at delegating
Doing HR admin and compliance effectively
Writing job descriptions
Scheduling performance reviews
Learning what it takes to be a leader
Making tough decisions when required (quickly and respectfully)
More about hiring, firing and engaging people here:
If you want to build and grow a beautiful business that stands the test of time, you can’t afford to get left behind. The pace of change and innovation is relentless. What was acceptable even a few years ago is no longer acceptable now.
Not long ago, it was still okay for a cafe to have a sign that said, “cash only”. Today, you’ll lose a lot of business if you don’t accept card payments. Even with a business as simple as mine, people still expect the option to make online bookings. Cloud computing combined with smartphone technology and advanced GPS systems mean that customers now even expect to be informed that their plumber is on the way and will pull up in front of their house in 13 minutes.
You don’t need to be Uber or Airbnb to implement new technology or come up with new ways of doing business. A few years ago, I bought a house in a different state of Australia. The real estate agent gave me a private showing of the house via Skype. I engaged the conveyancer, the building inspector and a surveyor all without setting foot in the house or even the state.
A client of mine with a creative marketing agency has a team of designers, copywriters and marketing assistants all over the world and she rarely even meets her clients face to face. Another client with a small supermarket chain has technology in his stores that allows him to see what’s going on in every area as well as getting live access to each of the store’s point-of-sale (POS) systems. He’s also put a bunch of tablet screens in his stores that allow people to find dinner recipes incorporating the fresh vegetables he has on special.
And all this stuff is only the beginning. It won’t be long before artificial intelligence is integrated into doctor’s surgeries, lawyer’s offices and copywriting agencies. If you think that technology and innovation won’t have a massive impact on the way you do business and how you create business growth, you are kidding yourself.
Your best employees may not all eat bacon and eggs for breakfast
The Shipbreakers of India, Pakistan and Bangladesh became famous after a documentary showed the other worldly scenes of the places in the subcontinent where the ships go to die. Here is an amazing video showing what goes on.
Shipbreaking is just one of the many professions that get outsourced all round the world. International outsourcing is big business in Australia too. More and more of the work we used to do here in Australia is being done in other countries where wage rates are lower.
A client of mine is a tax accountant and he has outsourced part of his operations to India. Another client of mine is an architect and he has started to outsource a lot of drafting work to the Philippines. It’s the way of the world whether we like it or not and I’d encourage you to put your toe in the water as well.
I have engaged various assistants and specialists overseas for the past 3.5 years.
I’ve hired a designer/ illustrator in India to help me with a couple of my books.
I have had various SEO specialists in India work on the ranking of my website in Google.
I have had someone translate one of my books into Dutch. (In the Philippines of all places)
And I currently engage a marketing specialist to help me with my content marketing and engagement strategy.
Some have been great and some haven’t been so wonderful and some could have been great, if only I’d understood the challenges better. Those challenges are what I’d like to talk about:
BRIDGING THE CULTURAL GAP
India, Pakistan, Indonesia, the Philippines are overflowing with highly skilled people who want to work. Some of them are incredibly cheap (like scary cheap) and some less so. You know this already of course. But here’s what you may not have considered. The gap in cultural understanding between you and a freelance contractor in the northwest of India, is real. Very much so. You need to be aware of that and you need to set your engagement structure up to suit.
A couple of years ago, I engaged Rajiv in India to do the typesetting and layout of my third book. Part of the project was to create 36 illustrations to be dispersed throughout the book. This caused me no end of trouble for a while, because I simply hadn’t foreseen that my visual reference points were so very different to Rajiv’s.
One example still makes me smile. For a particular illustration, I had in mind an image of a classic strong man in a circus, except instead of being dressed in a Hercules costume he was dressed in a business suit and instead of carrying a big weight above his head he would have a pyramid of office workers standing on his shoulders.
THERE’S NO CIRCUS IN NORTH INDIA
To me it was an obvious image. Rajiv didn’t get it. I had to send his drawings back several times, it just didn’t make any sense until I suddenly realised that Rajiv, who was born and raised in the country in north India, had probably never seen a circus nor a classic circus strong man. So I found a bunch of photos of strong men and old circuses and sent them to him and then he got it. The end result was great I think.
THE LESSONS I’VE LEARNT
So here’s a few of the lessons I’ve learned in engaging Rajiv, Jasmin, Aanchal, Sridhar, Oleg and various others over the past 4 years:
Understand that even if your employee speaks English, they won’t necessarily have the same understanding of a situation that you have.
Set out your expectations excessively clearly. When you’re working with someone who is 10,000 km and 6 time zones away from you, you can’t walk past their desk and look over their shoulder to see how they’re going. Agree how often you are going to talk in what format. Agree on what the key deliverables are, weekly, and how you measure and report on them.
Before you hire someone, pay them to do a specific test job and see how they go. I recently got 4 new marketing assistants to rewrite an old article of mine to see how they went and I paid them 2 hrs each for the article.
And then after you select someone based on the test job, still only engage them for two weeks and ask them to perform specific jobs in those two weeks and again compare.
Accept that your first hire is probably not going to work out well. It’s ok. Freelancers are generally engaged on a week by week basis and you can simply let them go and find someone else and apply the lessons you’ve learned.
Outsourcing to overseas contractors can work like a charm and it can allow you to do things you might otherwise never consider. But if you want it to work, you have to start by accepting that not everyone in the world has bacon and eggs for breakfast.
The March 2017 theme of the business thoughts newsletter is about staff, how to engage them and how to get the most out of them.
Staff management is one of the toughest topics for me to write about, because it was undoubtedly the area of business I found most confronting in my 20-odd years as an employer. Still, now, I am regularly challenged when managing various admin and marketing assistants in my coaching practice and I feel most unsure of myself when supporting my clients around their staff issues.
Managing people is always going to be the toughest thing you do in your small business, and, at the same time, in nearly all cases, it also offers the greatest opportunities to make money and make Business Fun.
In other words, there’s nothing more important than to get good at managing your people.
I’m going to illustrate how challenging it can be to be a great employer with a story about one of my favourite clients:
Employing a GM so you can step aside
Laura owns a design consultancy in Sydney in a specialised niche market. The business has functioned exceedingly well for over 10 years and is highly profitable and Laura is in the process of extracting herself from the day to day running of the business to allow her to focus more on her family and on a number of other interests. To be able to do so Laura promoted her chief designer Amanda to general manager of the business 2.5 years ago.
Amanda is a highly skilled designer, a good person, committed to the continued development of the business and to Laura personally. Laura and Amanda have enormous respect for each other. The perfect person to take on the GM role.
But it’s not working.
Slowly but surely the relationship between Amanda and Laura has soured over the past 2 years. Laura is entertaining the possibility that she and Amanda may have to part company. Amanda in her turn recently mentioned to Laura that she is considering her future with the company.
Amanda has for one reason or another never been able to get on top of the GM role and the business has suffered as a result.
Everyone is unhappy
Both of them are very unhappy and from my conversations with Laura I know her confidence has suffered. She’s feeling frustrated at the prospect of losing her best designer, and a friend, and that she may have to step back into the business full time again.
I think the unhappy story illustrates a few of the biggest challenges in managing staff in small business:
Small business owners find it very difficult to step away from the business. They’re generally deeply invested in it, not unlike parents are in their children. It’s really hard to let your kids go off and do their own thing when they get to adulthood. It’s also very hard for Laura to let her business become independent.
The old “Peter Principle”: People are promoted to one level above their ability. Just because Amanda is a great designer, doesn’t mean she has what it takes to be a great GM.
Employing people, managing people, takes skill and experience. There are good reasons that larger organisations employ specialist HR staff to do a lot of the people management stuff. Creating roles and responsibilities documents, negotiating employee conditions, managing deliverables and accountabilities, coaching staff to get the best out of them. It all takes skill, experience and time. Laura’s training in design and consulting included none of those disciplines.
Having our time over
Two and a half years on from putting Amanda in the GM role, Laura has learnt from the many mistakes she’s made. If she were to have her time with Amanda over, I have no doubt the experience would be a very different one for both of them. But we can’t have our time over, all we can do is apply our learnings to the future.
Laura’s predicament is a common one. It’s certainly not the first time I’ve been involved in such a situation with my clients in the past 12 years of coaching small business owners.
There’s a question I often ask my clients when in the midst of these employee challenges:
“In your heart of hearts, deep deep down, if you were given the best possible advice and you were to carry out that advice to the letter, do you think it’s possible for you to remedy this situation with your staff member and turn him or her into the engaged, highly functioning team member you need?”
In some cases the answer is: Yes, I think it’s possible to do so for me. And if that’s the answer, I help my clients find the way and encourage them to give it everything they can to turn the situation around and more often than not, there’s a successful outcome.
It’s too far gone
But sometimes, the answer to that question is: No, I doubt it, the situation is too far gone at this stage and I can’t see myself turning the ship around, no matter how hard I try.
In that case, there’s only one thing to do and that’s take steps to have the staff member move on, before things get uglier, as they undoubtedly will.
Laura doesn’t believe she can fix it anymore and we’ve started talking about how to end the relationship. Laura is absolutely committed to be as respectful and considerate of Amanda as possible and she wants to give her every opportunity to find a great new job where she can shine and be happy. She’s going to give her long notice (as long as 6 months) and support her in finding a new role in any way she can.
But Amanda will be fired by Laura.
Once it’s clear that in all likelihood the situation is not going to be remedied whatever you do, the most responsible thing you as the business owner and employer can do is to grasp the nettle and deal with the pain, calmly, clearly and respectfully. Avoiding the issue, putting it off, dragging it out is not in the best interest of yourself, or your business, and especially not in the best interest of the employee in question. Keeping people on just because you feel bad and you want to avoid confrontation and nastiness is truly the most disrespectful thing you can do to any employee… I promise you.
The pitfalls and the secrets of hiring family members in your business
Business and family don’t mix, is the old adage. And I’ve certainly seen the mixture blow up in a bunch of instances, but what about the many many family businesses out there that have done very well and been around a long time. Say what you will, but the Murdochs, Packers and Trumps are nothing if not succesful business families. So why are we so concerned about introducing family members into our businesses, and how can we avoid the worst of the pitfalls?
First of all, I think the problem with family and business, or for that matter friends and business, is not so much that it is more likely to fail than a normal business, but that if it fails it can cause so much collateral damage. Whole families can be ripped apart over a family partnership that disintegrates. If the manager of department X turns out to be an incompetent idiot, you as his direct report can simply leave. It may be inconvenient, but you’ll find another job and life moves on. But if that same manager is uncle Jimmy and the company was started by your father, and you have to sit at the same Christmas lunch table with Uncle Jimmy next month, then the situation becomes much more complicated.
The business owner’s dream
I’m not going to sit here and tell you never to hire a family member into your business. Most business owners dream of having their children join the business and have the thing they created be a vehicle for bringing the family closer and making life more comfortable for the family. In my days as a builder I often imagined that it would be really nice to have one or all of my kids become involved in my business. It’s how we roll as business owners, and it’s one of the reasons, I believe business owners on average are happier people as a group (more about business and happiness here) .
So how do we minimise the inherent risks of causing major family dramas when getting the clan involved in The Business.
From everything I’ve seen over the years I think there are four principles to managing family business well:
Acknowledge that it isn’t always going to be easy. Allow for the fact that just because we are family, doesn’t mean we all have the same values and beliefs or the same work ethic or for that matter the same priorities in life. Sure, family is important for most of us, but my own kids are still more important to me than uncle Jimmy’s kids.
Depending on the size of the organisation, ensure you have regular meetings (monthly ideally) in which issues can be tabled and resolved. The format of the meetings is dependent on circumstances. If there are two family members in a large organisation, it’s probably a good idea for those two people to go and have a drink every month and compare notes. But if a significant number of the employees of a business are all part of your family, organise a once a month family meeting, in which irritations and grievances are aired and worked through.
Take the time to set up job-role-descriptions and expectations for all employees in the business, but especially for the family members. There is nothing so destructive as a family member in a business who doesn’t actually know what is expected from him or her. Job descriptions, clarity about what constitutes “great work”, clarity on deliverables and KPIs… Take the trouble to set them up and hold people, family members especially, accountable to them.
Ensure that there is great clarity about how people move up the ladder in the company. Family members especially must know that there is a quid pro quo: Not unless you deliver XYZ and you have proven to be good at your current role, will you be considered for promotion: Just because you are my son, doesn’t mean you will be promoted beyond what you proven yourself capable of.
Involving your family in your business can destroy your family just as much as it can bring your family closer together and be an incredibly rewarding experience. Follow the four principles above and you give yourself the best opportunity to create the latter… I promise you.
Btw, if you want to be guided on how to make your family business work, I have created The Fun in Business Intensive program to make it safe for business owners like you to go on a great journey of change in their business, their family, and life. Click below to learn more!
I have spent the last few weeks getting very excited about World Cup soccer, and whether or not you like soccer or you get more excited about other footbal games with pointy balls… one thing is clear some teams sparkle (Germany for example) and some teams don’t (who can forget the crying distressed faces of the Brazillian supporters at the end of the semi finals?)
Thinking about staff and employees I often flash on what a friend of mine who is a nurse used to say (half-jokingly): “I could run such a great hospital if it wasn’t for all those ruddy patients.”
But the business owner’s lament is a different one: I know I could run such a great business if it wasn’t for those pesky staff
Michael Gerber, in his famous book: The E-Myth told us 25 years ago to give up trying to manage people, and focus on systems instead.
And in his time, Michael Gerber hadn’t even met a Gen-X employee yet, let alone Gen-Y! Ask your Gen-Y staff member to do something simple like smile at a customer and make them feel welcome when they walk into the shop and they look at you as if you just asked them to kiss a cockroach.
We all know that employing people is tough and it can be the toughest challenge any business owner faces when trying to develop and grow his or her business. And yet, it is also where the greatest opportunity lies for your business, because the essence of just about any business model ever invented is about charging a margin on labour, employees of some form in other words. And that statement holds true equally for either product or service business and even fully digital businesses will find it hard to be successful without employees of some sort.
So how do you engage those pesky staff members, so that you get the best out of them, and you don’t go grey prematurely?
I believe it all starts with this Golden Rule:
Hire for attitude and train for skill.
When you recruit for new employees I urge you to keep this Rule in the forefront of your mind – Always look for attitude first.
The founder of Visa International, Dee Hock shared this about hiring staff: “Hire first on the basis of Integrity; second on the basis of motivation; third, capacity; fourth understanding; fifth, knowledge and last and least, experience.”
Integrity and motivation are what makes a great team member. Most other skills can be taught.
Prepare Prepare Prepare
So how do you hire for attitude?
1) Prepare, prepare, prepare… Put together a simple series of questions that give you the opportunity to get a clear insight into this person, what they’re really like.
2) Organise trial days.
3) Experiment with role plays,
4) Involve your manager in the hiring process
5) Check references.
This is what happens when you don’t check references:
A client of mine, Wendy, runs an upmarket beauty salon in the Eastern Suburbs of Sydney. 6 months ago she fired one of her staff for unfailing laziness. Recently, Wendy received a phone call from the owner of another beauty salon in Sydney who had employed the previously ‘fired’ employee for some months, on the strength of the fact that she had worked for Wendy before. She rang Wendy, confused and disappointed, because of the bad attitude and performance of her new employee.
A simple reference check, before hiring a new employee can save you a whole heap of aggravation.
The second step in engaging your people is a little less obvious.
You see, your staff aren’t actually all that different to you, they are actually normal people, just like you, honest they are, trust me.
And people like to be engaged, they like to enjoy life, they like to collaborate with other people and they like to win.
It’s the reason so many of us play team sports. In my experience of working with many small business owners, the most effective approach to engage a bunch of employees in small business is to think of business as if it is a game of rugby.
Fun and winning
The reason we join a soccer team is to have fun and enjoy ourselves and the object of the game is to win.
I encourage all of my clients to start to think of their business as a soccer team (But maybe not the Brazilian world cup team at the moment!!) and their staff as fellow team members, with yourself as the captain and coach of the team.
As the captain you understand that your staff joined your team for exactly the same reasons you created it, to have fun and enjoy themselves and to win the game (That is as long as you hire for attitude). Furthermore you must help them understand how the whole team depends on each other.
As the coach you know that you must take the time to teach your team members the rules of the game, you have to train them to become more effective in their roles, and you have to show them how their actions have a direct impact on the outcome of the game.
Finally the team members need to feel they have a ‘stake in the outcome’; they have to feel that winning is good for them as individuals as much as it is for the team as a whole.
Don’t get me wrong, implementing what I just described isn’t easy, and no doubt there will be plenty of times when you will want to pull your hair out (there’s a good reason I don’t have any hair left). But by making it your prime responsibility as the business owner to become a great coach and captain of your team, you will be well on your way to building a Fun business that sustains you for years to come … I promise you.