For business owners: what are the biggest mistakes you made when starting your business (particularly in leading your employees)?
I'm building my team right now, and I want to be an effective leader. Any advice/past experiences that have helped you become a strong leader? Thanks!
I can't stress enough the importance of sticking to your initial vision. A CEO/business leader's job is to maximize performance by creating a culture that best enforces the initial business model.
Have your employees work towards very specific long-term goals, rather than focusing overwhelmingly on what's immediately at hand. Leading a team is more than resource allocation. You should develop employees and frequently engage in dialogues about development. Working towards a common goal for a new business can be an electrifying bond, as long as communication about the business flows both ways.
Hire a good accountant from the get-go!
Following free advice can really come back to bite you in the butt, costing thousands of dollars.
Keep a professional distance to them. The moment things develop further into friendships, you're going to find it a lot harder to discipline then when the need arises. You can be friendly without being friends and this would be the basis to my advice.
I would tell you to be very clear with your team on what you expect in production from them and not to deviate from your goals that you want to achieve as a business. Giving each employee a sense of ownership in what they do towards the success of the business is important too. You have hired them for a specific role, and you should want them to feel and understand how important their role is to you and the overall success of your business. Teamwork! :)
Having worked with hundreds of entrepreneurial founders my experience is that the biggest mistake in starting their businesses is the lack of a well thought out and written business plan. If you haven't developed a business plan then you can't share the plan with prospective employees and management team members. Any well done business plan contains an organization chart describing who is needed to do what, and how their contribution will make the plan happen. Entrepreneurs are typically loners, not leaders. Leadership has to be learned for most, and again without a plan that clearly outlines their vision and mission - it's hard for them or their team to "walk the talk". Good leaders motivate their team to want to make the plan happen, but if you don't have a plan the question becomes - "what are we trying to do around here"?
The first business I started was a huge success because of the right reasons. I stayed within my role as President & CEO and relied on everyone else to manage their roles with autonomy. It was a huge success. Later on, with another business I started I got in the way - ego, wanted things done my way, thinking I knew more about "how" they should perform, etc. A bust. Luckily for me those were early in my career and I reverted back to staying within my role. Lead your employees by spelling out their goals, giving them the responsibility and autonomy to do it their way, and holding them accountable for achieving the goals. Weekly 90 minute meetings with your management team to address the ever present issues and obstacles to goal achievement and helping them resolve those issues helps them become better managers, achieve their goals, and moves the company forward in a positive direction. Be good at what you do and allow others to do the same
Rob is correct. Have a clear vision, convey it to your team. Keep it front of you and them at all times.
1. Hire people with passion, experience is secondary. They can have all the experience in the world but f they are set in their ways, you will spend too much valuable time trying to sway them.
2. Look for their strengths and build on that it is much easier to build your team than focusing on weaknesses. You will have enough fires to put out and you need people to develop efficiently. Oh and their is the true secret. If you want to build your business, build your people show them you value them, they will build the business. Share your vision teach them and learn from them.
Learn from your mistakes. Even with a detailed plan things happen. It's OK to make mistakes provided you learn from them and quick when you are building a business.
A meaning of a leader is, having a positive progressive and ethical influence on others.
A leader is one that leads his people working with them. Who inspires or lifts their people. You will get the most out of them. because they will want to work.
A manager is someone who makes people do things.directs and doesn't take the time to develop people. People will work for you because they have to. They will leave you as soon as the next things comes around. You'll end up with unnecessary turnover and headaches. So back to passion find people that want to do things because they are passionate. They will be committed to you. Best of success.
One way to describe an experienced person is as one that has made a number of mistakes, recovered and then avoided repeating them. As a serial mistake maker I’ve set myself a few rules for dealing with staff that might be helpful.
Never hire someone you can’t fire. Family and friends might seem like a good choice when you start out but if they don’t work out it can create huge problems if you need to let them go.
Don’t expect your employees to love the firm as much as you do. Even for the most committed professional it’s your baby not theirs until you give them a little equity; and as you grow the team expect that eventually you will have employees for which it’s just a job.
Write a detailed job description before you advertise the post. Know what you want from the person and clearly communicate that to them so everyone is on the same page; then be consistent about what you ask of them. If circumstances change discuss, agree and document the revised requirements. This shouldn’t restrict your flexibility but might prevent it biting you later.
Don’t get too close to even your most senior staff. Drinks and sports on a Friday are fine but if you become godparent to your CFO's child you’ve put yourself in breach of rule one.
Don’t make promises until you know you can keep them. Nothing upsets people like an unfulfilled promise. It’s much better to surprise and delight with an unexpected 10% bonus than to deliver 20% when 50% was expected.
Invest in training as soon and as much as will benefit the business without breaking the bank. People feel valued well above their pay grade when their employer invests in their professional development. Especially in a start-up where long term job security is not guaranteed adding to their competence offers some income protection and implies your loyalty to them which will hopefully be reciprocated.
Be positive about hiring specific people, rather than simply filling a position, especially at this stage in the business!!!!
Every business owner should have their fair share of stories with individual problems. Leading a new operation is extraordinarily difficult, but setting a precedent for your employees and helping them wherever needed can make it easier.
My team had a tough time getting off the ground, as I hired people who were qualified for the positions I hired them for, but little more. While conducting interviews I didn't focus enough on the adaptability (an essential skill) of the candidates, and as a result, my operation's initial growth was slow.
Good luck, Zack!
In a nutshell:
Provide your employees the resources they need.
Listen to them and help them with what they need (don't micromanage them ask them what they need from you)
Give employees a chance to lead and recognize their accomplishments.
Delegate effectively with clear guidance mutually understood by both parties.
From my book, "The Servant Manager: 203 tips from the best places to work in America", I took my 25 years of management experience and added in feedback soliciting ideas from the 50 best places to work in America. This may be of interest to you.
Hire slow, fire fast.
My error was keeping people on for too long, even when I saw they weren't doing what I wanted done.
Take your time selecting excellent people--not just for skills and experience, but also for personal qualities, such as being a strong team player.
Then, when you see that someone is not working out, let them go right away. Don't hold on to them hoping they will improve, or because you hate firing people.
This means that you "hire at will" and don't give employment contracts. Don't give away pieces of equity to employees you may have to let go.
Two more things:
-- Don't create impossible job descriptions. "I want somebody who can watch the books and also be good with the customers." Hire two people, bookkeeper and customer service rep, even if part-time.
-- Don't confuse "marketing" with "selling." Many small companies hire an experienced marketing rep, then wonder why they never sell anything. "Our website and newsletter and social media are great, but he's terrible at going out and talking with prospects." "Selling" means activity that brings money in the door.
Keeping a professional, and ‘distant’ relationship (mentioned several times here) should certainly be in the forefront of any owner’s mind.
When you emphasis “particularly in leading your employees?”, the biggest mistake I think owners make centers on not leading by example. The most successful owner’s I’ve worked for were willing to do any job needed in crunch time. Another way of saying it is: Don’t ask an employee do something you’re not willing to do yourself.
It doesn’t matter how long you’ve run a small firm; you have to get your hands dirty. If your employees happen to see it… so much the better.
Honestly,, I learned the hard way to separate yourself between business and friendships. Keep a distance from employees. When you cross the friendship line, everything in terms of leadership, management, discipline gets blurry...and very inconsistent to others on the same team. Nothing but trouble. Stay all business in the business, and you'll be fine.
I want to echo what others have said and emphasize to "clone' yourself as quickly as possible. I waited too late to get started on this because I had a little trouble letting go of the control. So, start grooming your replacement right away.
Also, realize or expect to have to keep replacing folks. I think the days of expecting a person to stay working with you for years is unrealistic. I used to get so frustrated and disappointed when a person would choose to leave or it wasn't a fit and I had invested hours of training into them. Not that it happens a lot (cause if it does you have bigger problems) but to not take it personally. It is a natural ebb and flow of the business. Don't expect that this "one" person or these 15 people are going to stay with you forever. You want to invest your time and effort into their training and connect with them but don't be surprised when they move on. Cause it will happen.
The biggest mistake you will make will be failing to coach, counsel, direct and hold each employee accountable. You tend to provide a lot of leeway when you start your business because there is so much to focus on. You want to be sure once the engine starts it keeps going so you fail to pay attention to the small things. Catch them before it turns into smoke and never ever let the issues turn into a fire. Don't be afraid to let people go once you realize the dynamics are not there to make it work after you've done all you can to redirect, refocus and realign an employee with your companies goals and strategic plan.
Employee's want to feel empowered, some autonomy and the training to be able to do their job very well. This leads to job satisfaction and the desire to work hard. Empathy is essential always be able to put yourself in their shoes and keep your ears open.
I look for managers who have a glass half full mentality otherwise they feel more like they are pulling you down than up. Build on employee's strengths and know that everyone is different so to round out your team you will need complimentary people.
know exactly what you want to achieve.
Know honestly which skills you have
Know which skills you need to have in house to achieve your goal
Know which skills you need to get from ourside (oursource)
And then ask your friends for recomendations, but also use social media, and other advert sessions...
Engage the potential team members in a story/conversation, about what you want, and see how they respond...are they passionate? are they innovative? do they see your vision? remember, easier and better to bring something from inside people, than put something inside them...!!!
So, not to be negative, but it's critical to be able to fire people. Often new businesses will bring in people they know and think they can trust, caught up in the optimism of early growth. But sometimes the personal relationship gets in the way of the business imperatives and the business leader has a hard time doing what's necessary if things don't work out. Be sure you really understand who you're hiring and what your expectations are. At the end of the day, it's a business, and decisions have to be made that support the business, even potentially at the expense of some individuals.
Hello Zack, good question! Many of the big mistakes I made were covered in the book "Leadership Agility" http://ow.ly/xG6tR Of the other items not covered below, I recommend starting a monthly meeting with other business owners. Their support and experience will be extremely valuable, especially when you need to speak confidentially about employees or business. Finally, don't be afraid to spend the money on coaching, and team building. An outside perspective is extremely valuable and your employees will recognize that you care about them.