For many entrepreneurial or owner-operator businesses, a big challenge is that the “boss” becomes the architect and decision-maker in every critical area of the business. As a consequence, people who are hired and stay with the business become comfortable with that management style. In fact, most decisions are delegated upwards.
In the early phases of the business this works admirably, but as the business grows and the style becomes entrenched, not only do decisions not get made at lower levels of management, but other managers do not take any responsibility. What is perhaps even more detrimental is that they will not even acknowledge that there are problems or mistakes being made and that everything is not ideal.
In one such case in which we assisted, the owner and managing director realised that this style of management was inhibiting business growth and precluding him from a normal life. In his early fifties, he recognised that he needed help to re-structure his management team, re-align roles and responsibilities and develop a culture of accountability.
The first step was to find external help. The owner joined a coaching and mentoring group of executives with a professional consultant and disclosed the problem. In analysing the business together with the owner and his management team, it became apparent that the business had moved significantly into an aging life cycle and was probably between the early decline and late bureaucracy stage. Opening the problem up to discussion with his management team was a significant eye opener, as the whole team was aware of the problem but “waiting” for a solution.
While the change during the past six months has not been easy, it has been incredibly successful. The owner has moved from a state of utter despair to high motivation based on a complete new business strategy with clear management roles and responsibilities for the team. It has not been all plain-sailing. As always there have been tough decisions to be made, but as each one was taken, the next became clearer as well as easier.
A major breakthrough was the recognition that a number of his key employees were excellent technicians or crafts-persons but not managers. By applying their core skills and not focusing them on management responsibilities, they became highly motivated and solid contributors. This required a change in line management which was also a success.
The other significant change was in measurement of the business. Clear targets were agreed on for performance, both financial and non-financial, and the results measured and monitored in a timely way. While initially, this produced some unpleasant surprises, it enabled the team to recognise problem areas and take appropriate corrective action.
The overall shift in the business has been remarkable, and included a clear business strategy, a new and invigorated management team, and renewed energy and vitality in the company. Results have improved dramatically and, of course, the owner has a new lease on life as well as a new successful business.
Making changes of this magnitude are not easy, and require an absolute commitment to change as well as guidance along the unknown and sometimes difficult path. In the first phase, it is often difficult to see the benefits of the change as it usually involves deterioration before the improvement starts to take effect.
A major step in the right direction is to take notice of where you are, and the gap that needs to be filled to get to where you would like to be. Then, develop a plan that will bridge the gap, engaging appropriate help to enable you to achieve the transition and ensure you do not fall back into old habits.
This particular client had the foresight to recognise his dilemma. He needed the benefit of an external perspective to help him to drive and accelerate the process as well as to build the passion within the organisation to help people to change.