How growth can become a cancer
Too often, companies become the victims
of their own success. The successful Mom and Pop operation
becomes a three-store operation, then finds itself in financial
trouble once it reaches the point where Mom, Pop, and its best
employees cannot manage all the stores in its empire.
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When businesses grow, the need for rules
and regulations — employee handbooks and policy manuals
— increases.
A business might be able to operate with
a handful of employees without written rules, but inevitably,
an employee will be hired who needs to be disciplined, or who
complains that he or she is not being treated the same as the
other employees (for example, in terms of benefits such as
health insurance and time off). Rules will be necessary, and
those rules will need to be revised as employees learn to work
around those rules.
Of course, as businesses get bigger, the
need for managers rises. Managers are employees too, and they
sometimes need rules and direction just like rank-and-file
employees. A bad manager, however, can do far more damage than
a bad employee. Bad management decisions generate lawsuits.
That’s one reason why supervisor training is so
important, especially as businesses grow.
It is ridiculous to argue against growth,
and that is not the purpose of this article. Instead, I want
all businesses to confront the problems of growth with their
eyes wide open. Here are some useful tips to keep in mind.
It is better to wait for the right
employee (or manager) than hire the wrong employee, even if you
desperately need employees. And by the right employee, I also
mean the right employee in terms of personality and fit.
My firm was once larger than it is today,
and we hired competent lawyers without regard to personality
and fit. We ended up with lawyers who made it unpleasant to
work with them, and we ended up with lawyers who did not share
our commitment and devotion to client service, business
development, and hard work. Thankfully, they are gone, but not
without a great deal of pain in the process.
If you find an employee who shares your
values, you will probably not have to confront the unpleasant
task of firing him someday. If you take personality and fit
into account, you may not turn the workplace into a war zone
where employees are constantly fighting.
If you have hired the wrong employee, or
if you have made an incorrect growth decision, correct the
situation as soon as you can. Do not wait until you have no
choice. If you open a new store and it merely breaks even,
close it because it is taking away precious time and energy
from you with no return.
I can almost guarantee that the
break-even store is costing you money overall because you are
neglecting the better stores. I can almost guarantee that the
marginal employee is interfering with the efficiency of your
better employees. Why wait?
Of course, and there is always an
“of course,” selective hiring and quick firing
carry the risk of more litigation. That does not mean, however,
that you cannot minimize the risk by developing objective
criteria for hiring and discharge that ensure that you end up
with the right employee.
Those objective criteria are easy to
develop. Just look at your own performance as an ideal —
you show up early and leave late, you are good with customers,
you are concerned with cost and efficiency, and so on and so
forth.
You can also take a few moments to
describe the traits among your current employees that have
helped your business succeed. Then, apply those traits in your
hiring and firing, asking your labor attorney to look over
those objective criteria just in case you were a bit too
zealous.
Growth for growth’s sake is never a
good idea. Controlled growth, especially in the area of
employee recruitment and retention, is essential to continued,
healthy growth.
Don’t let your business be a victim
of uncontrolled growth and the scores of incompetent employees
it generates.
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