Two questions for us all.

First, have you booked up a decent break this year, to reward yourself for all your hard work and ensure that you do stop?

Second, is it the holiday you’d love to have, or just the one you can afford?

If the answer to either question is on the negative side, there are some factors that are worth considering which may have contributed to this scenario.

Those factors all relate to operational management and control, and can be quickly explored in the following areas:-

• Leadership or management
• KPIs – measuring and monitoring
• Staff – recruitment, management and monitoring
• Messages

Leadership or Management

There’s plenty of research around that delineates these two, but a snappy take on it is that good managers manage – they have the keys to the stock cupboard, know what’s in it and control it.  Effective leaders delegate the stock control, but have put processes in place to ensure that it’s done to their standards.

Both approaches are absolutely vital to a business, but when company owners are managers too, it severely restricts their ability and capacity to step away from the day-to-day and into the business growth and development arena.

And it also prevents them from taking time out – they may judge that there’s no-one else they trust to do it as well as they do. (More on that in the next two sections).  Of course, this creates the dilemma we raised at the beginning of the article – booking a holiday.  But far more important is the long term effect of this.  If the owner is necessary day-to-day to their business, how can they sell it as a going concern?  So their exit strategy can’t be viable, or perhaps doesn’t exist at all.

KPI’s – Measuring and Monitoring

Key Performance Indicators are always a hot topic.  Often staff are afraid of them being set – but this is usually because their previous experience has been negative or because they don’t understand the principle.  This, of course, always comes back to how the company introduces, implements and monitors them.

Let’s take a driving analogy. By and large it’s good practice on a motorway to stay above 65 mph but below 70 mph. (We’re cognizant of the law here, not general practice, but hopefully you’ll see the point!) Too slow and you cause problems for other drivers; too fast and quality and safety come into play.

KPIs are no different.  Properly understood, they are just our minimum speed, sometimes with a maximum built in for good sense. (Take, for example, a manufacturer who sets a target of 100 units per hour per operative. 110 would be great, but you might start to worry about Quality Assurance at 120.  A sales manager who meets their target is going to please – expected cash flow will be met, expenses covered etc. An extra 10% or 20% might also be exciting – but what’s the point at which your operations couldn’t meet demand?).

Setting targets for the important aspects of your business drives a number of important foundation blocks.

First, everyone knows what they should be achieving.  Second, the company should be matching those targets with the necessary resource to achieve it. (We can cite the example of a sales manager tasked with delivering additional sales but who was not permitted to set up meetings himself and had to use the automated booking system. This alienated potential clients and prevented him from succeeding).

Third, does everyone know exactly what they should be doing and how to do it?  Often, for example, there’s a belief that sales people are ‘born’, not trained.  Yet we know that to be untrue.  So has each post been properly understood, with clear tasks identified, matched to staff skills, and where there’s a shortfall, training provided?

Then, with KPIs in place, it’s important to monitor.  If we’re going off track, under-performing, what can we do about it?  If we’re exceeding our targets, what adjustments will we need to make to find capacity?

If you’re still not convinced, let’s take another analogy.  If we show you a TV clip then ask you some questions about it, you’ll get some right, some wrong.  If we tell you before we show you the clip that we’re going to ask you questions about what everyone is wearing, do you think you’ll perform better?

Staff – Recruitment, Management and Monitoring

This is a huge area, and for the purpose of this article, we’ll focus just on the delivery of KPIs, but do watch out for future reports looking more broadly at this topic.

In every business, people say things like ‘We just cannot get good staff’, or ‘it’s quicker to do it myself’.  Let’s be honest – what we’re really saying is that we didn’t identify clearly enough the right recruits and we didn’t set up a process to identify what we wanted them to do or the standards we wanted them to hit. And therefore we probably didn’t train them to do those things.

So they under-performed and either got demotivated by that or we did, and let them go.  And there’s a vicious circle here, because now the chances are that you’ll either not bother to recruit again and try to do it yourself (becoming a manager again and not a leader) or you still don’t define what you really need and how to get them to work and start that process all over again.

A Job Spec is a useful (not to say legally required) document, because you can use it to list the tasks expected of a new recruit.  But what we often forget is the Person Spec, because we think it’s just a woolly HR thing.  But try it this way.  Think about a person who you consider under-performed that you’re now planning to replace – let’s say in your admin team.  They were, for example, poor at telephone communication.  So would it make sense, in the person spec section, to set ‘high standards of verbal communication, together with a professional and approachable telephone manner’?  Then you can use the interview process to test that skill.  (More of us are using simple tasks now to test applicants, rather than just relying on their word for it).

Once you have the appropriately skilled and (at least as important) appropriately motivated member of staff in place, it’s important to plan their development from new recruit to effective member of staff.  Week by week their KPIs need to be tightened as they mature in their performance. If this sits alongside careful (and constructive, supportive) monitoring, matched up with relevant training, this can be speeded up quite significantly.

Business owners sometimes have a terrible habit of thinking, if not saying ‘They’re just not up to it’, conveniently forgetting that they themselves are only up to it because of experience, learning by trial and error and – hopefully – some support from peers and mentors.

Messages

Just a final thought.  It’s what we don’t say that’s often more powerful than what we did announce.  So ‘I’m not going away this year’ could be heard as ‘I don’t trust you on your own’.  Or even ‘the business is in trouble, so I can’t go away’. Both of those will destabilise your staff.

Working extremely long hours, being snappy, not delegating;  all these have sinister messages that other people will observe and assume.

Working in that way often comes from two places.  One can be that we had to work just that hard at start-up, and it became a habit.  Or it can be that, when we were still employed, it was in a culture of ‘he who works the latest each night wins the prize’, and we carry that through to our own business.

But let’s put that into a real scenario.  Which one do we think is truly the successful owner? The one turning over £5 million, 20% profit, nice car, long days, limited holidays, limited real life?

Or the one turning over £5 million, 20% profit, nice car, reasonable days, decent holidays, fulfilling life?

Truly, the choice is yours.