We have been hearing a lot recently about the Best Managed Companies and what it takes to be labeled so, and while it’s a great subject to follow and learn from, I believe the list is different for a small company from a large one. Except for the one thing – a tireless focus on people. If you recruit the best, treat them well and train them as required, they will look after you and your company. But you need to make sure you have all the skills you need.
For example, do you have in-house experience with your payroll accounting? If your payroll account gets in trouble the CRA can cause a lot of headaches. Same with your recurring HST reporting, tax planning and optimizing your tax strategies? Not everyone can figure these out by themselves and hire someone full time might be an option for a large company but the small companies are continuously head-count constrained due to costs.
What about Marketing and Sales? Do you recognize the differences and staff accordingly? Do you employ team leads or managers to optimize the team’s efforts? Or do you do it yourself? And for a final example, let’s use service delivery: Are your people fully trained and equipped to deliver the exceptional customer experience that draws the highest testimonials and references? Do you employ people and mechanisms to measure and optimize performance? To be able to fix problems before they show up in the sales numbers? Successful companies of a certain size will be well-equipped with people and expertise in these areas, but what does the smaller company do? Small companies cannot afford the headcount for all these levels of quality and support activities. So what do we do in order to be the best we can be and compete? Can we compete? Of course we can! The flexibility of the small company can provide serious competition for the larger company that is slow to change due to its infrastructure of procedures. The thing that makes them good (repeatable processes) is also the thing that prevents them from being agile. While we cannot do some things the big companies can, we can be quick to take advantage of opportunities.
But today I am talking about what makes a best-managed company. To me, the small company that can be labeled ‘Best Managed’ has hired the very best people they could, treats them well and demands an integrated team approach to covering all the bases. Not only will the best people deliver the best services they will also be multi-faceted and multi-skilled so the small company can deploy a full team with all the skills necessary. It is up to the owner-manager to be able to identify the skills and attract and retain the people.
Now how do we go about hiring the right people? Large companies have a great focus on hiring specific skills – basically, if you’ve done it before they want you to come and do it again. A combination of training, education and experience is assessed for consideration. But a small company should look beyond the immediate skills. You are hiring a member of the team that is required to step up in a number of areas. You need to focus on character.
Hiring right starts with understanding what you need, then attracting some candidates and selecting the new hire based on predetermined criteria. Too many owner-operators hire on ‘gut’ feeling and maybe some articulation of skills, and then regret it later. We need to take the hiring as seriously as the candidate does. Be open on the challenges of working in a small company as well as identifying the advantages. If a candidate has never worked for a small company before, they will find it difficult to adjust, unless they are ready for the new environment. Clearly identify what will be expected of them, with a discussion of a ‘typical day’ probably being as much value to you as it would be to the candidate in sharing expectations.
But how do you hire for ‘character’? The false nature of the interview makes it difficult to have an open discussion necessary to revealing character, so you need to ask questions that require some thought and some indication on how the candidate might respond to ‘character’ situations. Perhaps the best way is to ask how the candidate has responded to certain situations in the past. Their answers should indicate their thought process as well as the behaviour that they think is important.
Finally, if you don’t think you can do a good job finding the right person, seek professional help from your support team. The Best Managed Companies and the most successful companies focus on people. It is well worth our time to build and retain the best team we can. If you have a skills gap or some questions about how to optimize your business, call us and we’ll be happy to leverage our expertise to help you evolve to meet your objectives.