I was never taught how to manage a business and its people. I just got on with it, making mistakes and learning along the way. I did consider going to the London Business School to learn how, but one of the professors I knew there said I’d learn more on the job. She was right, but it was tough going at times especially the people bit. Management accounts and legals were studied and consultants were on hand for a fee, but dealing with people and reaching decisions with them was another thing entirely.
My first assumption was that everyone would want to be equally engaged in the business particularly when we were small – we would be a band of brothers and sisters with a say in every decision. My view was that everyone was making life decisions outside of work – dealing with student debt, buying a flat, having a family etc., so they should be ok to do that at work as well. Too simplistic. Not everyone had the same experience, or access to vital information, or capability, or desire to take on the responsibilities. When everyone was equal, the easy stuff quickly found consensus and got done, but the hard stuff got continuously debated and never resolved because nobody felt they had the right to overrule anyone else.
At first, even though I was the boss, I didn’t like making that call either in the fear that I’d upset someone. When I did finally have to make the tougher decisions I sensed a relief in the team, even if some didn’t agree – at least we were moving forward. That didn’t mean we turned from a flat structure to a narrow pyramid with me at the top. I, we, still believed in everyone taking responsibility for the business they were part off, but we had to work out how best to implement it. We were encouraged to find our Sri Lankan client Suranga Herath from The English Tea Shop felt the same. He had adopted an approach developed by an American outfit calling themselves The Great Game of Business. We enthusiastically adopted many of their practices and philosophies.
Firstly, we found you can’t expect your staff to be involved in business decisions unless they understand how a business works, so we taught them all the basics of management accounts. Everyone at Echo knows what cashflow is.
Secondly, you can’t expect anyone to decide anything unless they know critical financial information, so we started to share the topline P&L on a regular basis, just keeping confidential things like salaries under wraps. This is not always easy, especially when things aren’t going well, but we learnt that if things are not going to plan it’s best to be prompt and honest about the situation as the team rallies to get us all out of the hole.
The third thing we learnt is you can’t expect people to contribute if they don’t see the benefit to them personally and collectively. Partly this is sharing in the financial success through bonuses, but also more fundamentally in job security. The idea of a job for life seems a thing of the past in a highly competitive marketplace but, in this time of big business hire and fire, job security needs to be valued. It’s the overriding thing I worry about, for me and my family and for all our staff and theirs. Understanding the business and making the right decisions is critical to everyone’s job security. Of course, when revenue reduces the team may have to reduce as well. It’s the hardest thing to let people go, but the security of the majority is paramount and collectively we all want to believe we did the most to avoid that situation.
On a more upbeat note, another challenge is to master decision making in growth, both of the individual and the business. As a company grows so do the people. Most want to progress their careers, take on more responsibility and get paid more. That means seniors letting go of responsibilities to juniors and taking on new ones themselves. No easy feat when time is tight and ‘it’s quicker if I do it’, but how else can people learn unless they practice, maybe even making the wrong decisions a few times. I know I did. We found mentorship methodologies help by encouraging decisions to be made as far down the chain as possible rather than naturally percolating to the top. Whilst the buck stops with me, the MD shouldn’t need to sort out the aircon as well as the accounts!
Consensus is always the objective, but in reality, I’ve realised the critical business decisions are rarely clear-cut, there is always ambiguity, shifting reference points, different opinions. Yet you have to make the call, stay ahead of the game, otherwise events will overtake you and you will no longer be in control.
Steer the ship or crash into the rocks – easy!
