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Do I Need A Manager?
The issue of hiring a manager comes up quite often, but lately it seems to be on quite a few people’s minds. When asked about this, I always respond by asking the same question. WHY?
What positive result(s) are you expecting when you hire another rather expensive employee or promote a current employee to a management position?
1. Do you expect to get more production from your staff because you would have someone watching them all the time? If so, how does this new manager know what you would want done if you were standing in their shoes each and every minute of the day? Obviously, they are going to have to follow YOU around for a few months to learn how you think and make your minute-to-minute decisions. Remember, the Vulcan Mind Meld only works on Star Trek; it doesn’t work that way in real life. Chances are very good that you’re not going to be happy with the way they handle things without a lot of training.
2. Maybe we hire people who can’t read English or simply cannot read, and we need someone to tell them what the work orders say. If so, total up all their payroll costs (including the manager’s), then divide it by the number of actual workers (don’t include the manager) and see how much you’re paying to get the job done. We almost always find it’s more cost effective to hire people with a little more intelligence or skills. We will certainly get better results and more qualified people who can grow with our company. Minimum wage employees take the job and “show up” (most of the time) at this pay grade because they are not smart enough, educated enough or reliable enough to get a better job. This may be one of those situations where the old saying “you get what you pay for” applies. Try incentive pay instead of having someone walk around making sure all the staff is doing their job. It’s costs less, improves morale (because of higher pay and better teamwork) and is very effective at keeping production up. An additional bonus is we are able to operate with fewer employees. My experience has shown that incentive pay is the most effective way to pay in our industry because we get more work done, and it costs us less in payroll.
3. “They do a good job, and it’s a way to give them more money.” or “They’re honest, on-time every day and I need someone to open or close.” I actually hear these comments quite often; and, almost without exception, we are talking about why that particular person is a manager. We don’t need a title to pay a person more for what they do for us! The word “MANAGER” means something to people. Having a key to the place and the security code does not make a person a manager.
4. I need someone to handle problems and make decisions when I’m busy or not at the shop. Now this is a valid issue, and I would absolutely agree there is a need for this position. However, this really doesn’t mean we need a manager Appoint a lead person for production and one for sales. These people are workers just like everyone else in the department, but they have the experience and/or the intelligence to make a decision when another employee is not sure what to do. These people do the same jobs as other employees and should be on the same incentive pay program, except we pay them a small amount of money each month for handling these issues. These are people who already work for us, and we know they have a pretty good understanding of their department. The other employees don’t answer to them nor work for them. They just go to the lead person when they need help with a problem. We don’t need a task master because incentive pay assures that everyone is working or they are not being paid.
5. “I hate dealing with customer problems, and I can’t get anything done for all the problems people bring me everyday.” This is a very valid point and almost every owner has this thought at one time or another (sometimes many times in one day!!!). However, does it make sense that hiring another person who has no idea how you think or what you want will solve this problem? If we are already having trouble buying inventory, we just reduced our car-buying money by the amount of the manager’s salary, so sales may drop at the same time we need them to go up to cover the added expense. If you don’t like to handle customer problems, then you can teach your current staff to handle many of these issues before they get to you. You may have to set up some penalty for situations where the customer demands to talk to you about the problem, because the employee mishandled it, assuming the customer has a valid issue or is a valued customer. Ask yourself, “Who handles all these problems when I’m gone to a conference or on vacation”? Does your company fold up when you leave? If it did, the problem is sitting in your seat. You have to train your staff how to think through a problem and what the guidelines are in your company. If the company did just fine while you are gone, the problem is still sitting in your seat. If they are able to make good decisions when I’m gone, then what changed when I came back? ME.
6. “I want more time off or the company has grown to the point I can’t handle all the issues.” If you are to the point in your life where you want to enjoy travel, golf, time with family or whatever you like to do, then a manager may be a good investment if their pay will not reduce your ability to grow. The problem is finding someone who can fill our shoes or actually wears bigger shoes than us. I have seen many attempts at finding a good manager and more failures than successes. This is a major issue for companies like Wal-mart, Lowe’s or even LKQ, so why would it be any different for smaller companies? Here’s my opinion: “The best source for a manager of the future is the employee of today.” Using lead people will show you who has the potential to advance to the next level. This means it takes time to develop the right person. Therefore, we have to be prepared to spend some time with our “leads” if we want to be able to leave. If we do a good job of this, everything will work just as well when we are gone as when we are at the shop. This works for having more time off and to insure the growth of the company.
The bottom line is, and has always been, that our best source of management comes from within, not by hiring someone. Is this always true? NO! There are some excellent managers out there who were actually hired from other industries. However, the odds are overwhelmingly in favor of you finding the best people for the future by hiring intelligent, motivated people for each and every job in the company. I have had three recycling businesses, and I sold two of them to the managers of those companies. Both started as employees and grew into the ownership of the business. I wish it was simpler and quicker, but in the long run, the process can provide an immense sense of satisfaction when you develop your key employees from the group of people you spotted as having potential and had the foresight to hire and train.