Copyright © 2006 by Michael Boone & Associates · All Rights reserved
Building a Quality Organization - Part 2
Michael Boone & Associates Newsletter
Building a Quality Organization October 2005
The Wrong Hire for the Job
Frequently we are asked the question, "what makes a good manager?" Before we answer the question, let us consider for a moment the real importance of a branch manager. In looking at the three key jobs at a staffing organization, i.e. owner, sales and staffing coordinators, we find the most vulnerable link is the branch manager. By branch manager we mean the individual who manages the sales process as
well as the internal process. As an organization grows and matures, the expansion minded owner soon realizes he can handle only so many people personally. As a result, the manager is then forced to appoint the first manager. This step into an organizational level of development can either be the start of building a large, dynamic organization or it can be the first step to failure for the entrepreneur. If that owner is lucky enough to make a correct selection for the first manager, they may be on their way to success. If not, they not only risk losing people but could lose the whole business.
The Wrong Hire for the Job
The most common mistake made by most owners is the promotion of their top producers to managers. The error in this method of selection is fundamentally one of job comfort. Owners assume the top producers want to be managers because this is something to which everyone aspires. We are fed the message through our school systems and universities that the measure of success is to become a manager. We, therefore, assume the natural progression is to promote the top producers to managers which is the way to reward them. Let's investigate the fallacy of this. First of all, the prospective branch managers have to possess certain qualities to be top producers. They have to be aggressive, results oriented, somewhat ego- centered and completely dedicated in getting direct results. The manager who succeeds with the highest degree of productivity is a person who is oriented toward his people, who has a great deal of empathy and can sublimate his own ego to that of the group. We find that many top producers, when placed in a managerial role, do not feel comfortable because the job itself does not reward their fundamental behavior.
For example, one of our clients promoted his top sales person to management. At that time, the branch was doing about six million in sales with a 24% g.p. This top producer was personally responsible for about 65% of that volume. The sales person was good. I mean she had the customers eating out of her hand. She was on top of their needs - and knew how to meet those needs. As a result of her promotion, the sales were reduced. She hired a sales trainee and tried to show the new-hire all the tricks she had used. The new-hire did not pick up as quickly as the manager thought she should so confidence in the new-hire went down. Pressure began to mount on the inside, and turnover was the result. Within six months, the volume slipped to four million and gross profit to 19%. A double whammy - the loss of good customers with good margins and turnover of experienced staff. To make matters worse, the top producer - manager started to burn out.
The owner was smart enough to get outside help. With assistance from independent behavorial evaluations (some people call them tests), we encouraged the manager to return to sales and the owner then returned to managing the office until the staff stabilized. I am happy to report that in five years, the top producer/manager is still there in sales and the branch is well on its way to a record year.
Other managerial failures may not be so dramatic or obvious as top producers respond to their frustration in different ways. There are hundreds of cases of managerial misplacements.
DON'T LET THIS HAPPEN TO YOUR COMPANY!!!!!!!
Next month, we'll talk about the "Qualities of a Manager" - Stay Tuned!