When I started Office Space in Town with my sister in 2009, we were entering a market that was virtually unheard of and undervalued. Yet, over the last eight years, we have grown from a family startup to a multi-million pound business. While in part our success is down to the fact that we anticipated changing market preferences, a significant factor in our continued success has been the management structure and team that we put in place.
It is essential that, as your business grows, so too does your management team. Businesses that fail to devolve management tasks and that depend too heavily on one or two decision makers are ultimately restricting their ability to grow efficiently. A good management team can help you to scale up, develop a strong culture and will ultimately improve your profitability.
As part of this Founders Diaries entry, I through it would be valuable to share my five tips for entrepreneurs to implement an effective management structure and team.
Select the right senior people for the right functions
In any business, one of the most important roles of a CEO is to match the skill sets of the management team to the tasks needed to deliver the business goals and objectives.
However, NFI Research found that more than two-thirds of senior executives and managers believe that the skill sets required for certain jobs do not match the people currently filling those positions. When people aren’t suited for their role, they tend to underperform.
When hiring for senior positions, business owners should focus on determining each manager’s skill set, making sure that their strengths are matched to the role that needs to be filled. This will create a better working environment, reduce stress levels and improve productivity and retention rates.
At Office Space in Town, we know that agility and innovation are vital to our future success. We therefore look for individuals who have a passion for our industry and that are decisive and creative.
Hire someone who will excel today and five years from now
When recruiting managers, look for individuals who have the right experience today but who will also have what you need five years from now. I suggest that you look at your management team as an investment and ask yourself about the return on investment you expect from each individual. It is also important for you to acknowledge what skills already exist in the team. Entrepreneurs are often guilty of hiring individuals that mirror their own strengths rather than looking for individuals to fill in the gaps.
Strike the right balance between autonomy and control
It is important to get the correct balance of autonomy and control as we have found that when employees feel a sense of autonomy, they are more productive and happier at work. Our mission, strategic goals and values are tightly focused and communicated effectively. We have a flat structure where hierarchy is kept to a minimum and our team works in self-empowered positions. We run a “no blame culture”, where individuals are empowered to make operational decisions for themselves. Finally, we focus on systematic value management, ensuring maximum efficiency at the lowest price.
Change your structure as you evolve your strategy
In today’s fast-pace, digital economy, businesses and their teams must be agile to remain relevant and competitive. Without these skills, businesses are likely to fall behind their competitors and fail to meet the needs of their customers and industry. Evolving your management team and indeed management structure in line with any changes to company strategy, dictated by changing market conditions and opportunities is a key role of senior management.
Bringing professional management into a family business
For family-owned businesses, appointing external management requires significant change from a psychological perspective, and yet it is vital for strong corporate governance. Shareholders in family businesses should look for directors who share their view of the company, who – like them – believe in its long-term vision and viability, and who shares their corporate, if not their biological DNA.
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