The good news is, our company is growing. This is what we always wanted. But it’s scary for us, as owners, too. We worry a lot about losing control. How do we keep in touch and know things are being done properly if we’re not directly involved?
THOUGHTS OF THE DAY: Controlling things as you grow the company is a challenge for most small-business owners. Build systems, procedures and checklists so you can teach everyone how you want things done. Insist on reports and auditing as control tools. Building up checks and balances and cross-company incentives helps to get everyone on the same page, watching out for how things are going. Pay attention when you hear comments.
One of the reasons that so many companies remain small is that business owners tend to be hands-on and that limits the size to which their companies can grow. Bigger companies have more to do, more employees to manage, more customers to see. And that means that as an owner you’ll have to delegate more.
Consistency makes money in any company. Help to ensure things get done the way you want by writing it down – procedures. Ask the next person in line to improve those procedures. Use checklists to learn more about when and why things go right and go wrong.
As the company grows, one overhead investment you’ll want to make is in people who make sure things go right. In the early stages of the business, it’s the owner. Later on the owner has other important roles to fill such as developing and managing the company’s long-term growth strategies. Managers, team leaders or people in a separate reporting line need to check and report.
I know of many business owners who overlooked this crucial checking function. Then they find out there were errors with reporting, managers were fudging numbers, money was going out the door for the wrong things, and in some cases, outright theft was rampant. Why wouldn’t an owner put in place people to proof what’s going on? Because it costs money and owners are eternal optimists thinking bad things will never happen to them.
Bad stuff can and does happen all the time. Prevention through auditing can be hard to justify, because if it’s done right, the problems never show up. Savvy business owners know this, treat error checking and reporting as costs of doing business and build that into their overall profit structure in order to ensure the company stays safe as it grows.
Get everyone on the same team with bonus programs. Reward everyone based on the company’s overall profitability. Get all employees involved in keeping a close eye on everything, fixing problems and looking for ways to implement best practices.
Teach employees that bonuses ultimately depend on monitoring and improving what’s going on. Give employees reports to use and education on what to do with those reports. Emphasize the importance of cutting waste, dealing with unprofitable accounts, boosting growth with profitable customers and handling tough employee situations legally and fairly.
Stay in touch by walking around and talking with people. When you get feedback, pay attention. Celebrate the good stuff. Carefully investigate complaints, even if they’re about someone you consider part of your insider team. Deal with problems promptly. Don’t avoid them.
There’s a saying: respect what you inspect. If something is important enough to do well, make sure you can confirm that it’s done well. This is no time to hope, only to be disappointed later. Ask everyone around you to pay attention to details and report in with both good and bad examples so everyone can work to improve how things are done.
BOOK RECOMMENDATION: “The Connected Manager, Leadership 101” by John Nesgoda III.
Andi Gray is the president of Strategy Leaders Inc., StrategyLeaders.com, a business-consulting firm that teaches companies how to double revenue and triple profits in repetitive growth cycles. Have a question for AskAndi? Wondering how Strategy Leaders can help your business thrive? Call or email for a free consultation and diagnostics: 877-238-3535 or AskAndi@StrategyLeaders.com. Check out our library of business advice articles at AskAndi.com.