A Big thank you to our colleagues at Counts Consulting, LLC for giving us permission to post their previously published article. Permission granted VIA email 10/13/11. All articles are reprinted in their entirety as originally published.
Who’s In Charge?
I must say I feel a little embarrassed that I would see a need to write this article.
Obviously, the answer to the title should be that the owner of the business is in charge, and in most businesses, that proves to be the case. However, when the rubber meets the road, I often find businesses where employees are actually the ones telling the owner(s) what they will or will not be doing. Sometimes, as blatantly as simply saying, “I’m not going to do that.” Others simply ignore what the owner wants and gets away with it!
1. The owner decides to upgrade their inventory management system; and one of the “old” employees, who has nothing invested in the company, notifies the owner, the person with all the money and time invested in the company, that they will quit before they learn the new system so the owner backs off.
2. The owner wants to improve the buying or inventory process and the employee charged with this job REFUSES to use the new tool or software, and the owner lets the employee do whatever they want.
3. The owner’s profits are gradually decreasing (and the employees continue to want more money) so he/she decides to implement an incentive pay program so increased production would raise the employee’s income. The employee(s) threaten to quit before they will do more work to earn more pay so the owner backs off and simply gives in.
4. The owner wants the sales staff to sell brokered parts or extended warranties, and the employees simply don’t try and are not willing to learn how to accomplish what the owner wants.
Obviously, the employees are the final decision makers in the above examples. I guess the owner thinks the employee is irreplaceable. In the past, I worked for a company that sold $5 billion in products per year, and I can assure you that EVERYONE is replaceable, including ME and YOU.
Too often I hear an owner say, “I’ve told them to do that, but they just won’t do it.” Well, I think we just discovered who’s running that company.
When we let employees/relatives start telling us what they will or will not do or just ignore what we instruct them to do, it’s time to either retire or sell the company, because the day that is allowed the company has reached its peak, and it’s all downhill from there.
Actually, if you think about it, you may know some of these companies. Think about the big competitor in your area of 20 years ago. What happened to them? Was it the owner who resisted change or was it their employees or relatives who held the company back?
Let me encourage you to be firm, but fair. After all, you are paying them, not them paying you. Two incentives come to mind. One can be financial and/or the other managerial. If you ask an employee to do something, that should be what happens. If not, they need to be written up and notified in writing that failure to follow instructions is grounds for dismissal. I promise you, if you fire one of the hard heads in your company, EVERYONE will sit up and know WHO’S IN CHARGE! If your sales staff won’t broker parts, sell warranties or collect for freight, then reduce their pay on in-stock sales until they either help your customers get the parts they need or the employee takes a cut in pay. Someone asked me recently, “What if I reduced the commission on in-house sales, and they still don’t broker parts or sell warranties?” My response? “Then you didn’t cut it enough.” Employees are supposed to accomplish the needs of the company and take care of our products and customers. When they don’t do that, it’s time to take charge of the situation. Amazingly, even some larger recyclers are now allowing employees to dictate what they will or won’t do, either directly by refusing or indirectly, by ignoring the request.
One of my customers asked an employee to do something, and the employee told him, “That’s not my job.” The owner said, “You’re correct, it’s not, you don’t have a job here anymore.” That happened almost 20 years ago and that story is still told not only in that company but in that whole area. This owner does not tolerate employees telling him what they will or will not do. That does not mean he isn’t open to suggestions or ideas on how to do things better, but once the decision is made, it had best be done that way and right away.
Remember, who has all the money and time invested in your company! I seriously doubt that any of your employees have a single penny invested there. Therefore, if they want to make the decisions, they need to do what you did, go buy or start their own company. Trust me, when I say: you and your company can get along just fine without any one of them!