Friday, September 08, 2006

Quick Management Lesson

When I first went into business for myself, I had 4 employees working along with me. I was running a pro-shop/smoothie bar inside a superclub. 23 years old, managing people pretty close to my age, enjoying the hell out of working for myself. I never had any turnover to speak of, a couple of college students would work temporarily, and then leave, always on good terms. I wasn’t everyone’s buddy, but if they straggled in a little late, or had something come up, I was a pretty forgiving guy. I talked to them about upsells, cross-sells, education, but there was no formal training. Whenever I needed to hire someone, I basically asked the other employees if anyone they knew needed a job.

After almost 18 months of doing this, I had the opportunity to open a second location. This was my goal from the start, and what I expected to be the time I really turned the corner regarding revenues.

What really happened is I turned the corner and became twice as incompetent as a manager. Everything that I had been doing wrong was magnified.

First off, I was trusting that whomever was working while I was away was a) on time, b) trying to increase sales, c) wasn’t stealing, and d) cared about the business as much as I did.

Wow, was I wrong.

I learned very quickly that absolutely no one cares about your business as much as you do. Bar none. That business is your baby, and if you don’t care for it like one, it will never flourish.

I also learned that you can’t expect what you don’t inspect. If I wasn’t holding them accountable for the tasks I assigned, I was assured that they would eventually stop doing them. Maybe not the first time, maybe not the 5th, but at some point the employee would come to the realization, “Hey, if he isn’t checking to see that I was cleaning those shelves, it must not be a big deal, so I don’t always have to do it.” That one can bite you really quick.

Not all employees are bad, don’t get me wrong. Most of my employees then, and my employees now, I believe, are good employees. Most of what they needed was proper management. The good employees have more to offer if you can reward and motivate them.

Poor employees need to be gone as fast as you can identify them. Don’t hesitate.
Probably one of the most important lessons I’ve learned as an entrepreneur, hire slow, fire fast. This principle, if not followed, can foster cancer and poison within your business. It’s as simple as that. Be very careful about the precedent you set regarding second chances, because as soon as you give an inch, someone is going to take another inch, and another, until it has become a foot.

Building your business will depend on your selection and management of employees, there is no way around that. This is the foundation of Jim Collins’ “Good to Great” which lends incredible insight into getting the right people on board, then putting them in the right place. Improving the quality, capabilities, and motivation of those employees can put your bottom line through the roof, or submarine your entire operation. Train them well, hold them accountable, and reward them. As soon as your employees elevate their level of performance, your business will be elevated.

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