SMBs, Build the Right Foundation

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SMBs are competing against the big boys daily. ADT, ADP, Price Waterhouse, Merrill Lynch, Office Depot, Verizon… These are huge, international businesses whose names define their industries. They have company policies which are standard across all of their locations, and consumers and employees of each business know that they are dealing with a giant. No one expects special treatment – the expect to live within “company policy.” And let’s face it: company policy is pretty darn good.

As a consultant I see SMBs every day who are competing with these industry giants. Some are succeeding, and some are struggling. Who’s who? The strugglers are those who haven’t defined their internal structure (company policy) and their growth plan in keeping with the size they will be this year.

Case in point:

A small payroll company who doesn’t want to create a training program for new sales reps. No perfomance-based onboarding program at all. Why not define a specific repeatable sales process for their reps to follow? They want to hire from the national competitors exclusively, and put the new reps on the street day one. It doesn’t work. The new reps are no longer selling the number one company in the space, whose reputation and consistent results are a given. They are selling an unknown company, trying to prove value, and trying to establish authority and expertise. They didn’t have to do that when they worked at ADP or Paychex. And they weren’t trained on how to present the new company.

This year, that small payroll company will be small. At this rate, they’ll be small next year, too. Rather than capitalize on their SMB status and agility, they’re trying to operate as an industry giant. It’s not working.

Management Structure

Many SMBs also avoid creating a management structure. The business owner wants everyone reporting to him or her. Hiring experienced employees who “know what to do” doesn’t mean they’ll do it correctly or consistently without being held accountable. And they’ve never done it for this business. The boss doesn’t have the time or the expertise to micromanage the entire company and grow it at the same time.

Having a simple Ops plan for each job description or department is critical for having a company that offers a consistent product or service. The company can’t operate on, “Joe knows what to do.” The company needs “Joe’s” results to be repeatable even if Joe is out sick, or on vacation, or decides to quit because he’s won the lottery. As SMBs are growing, they need to be able to hire others to be Joe’s coworkers and teach them to execute Joe’s job functions just as consistently. Otherwise, the company is a hostage to Joe and his knowledge.

Do you need help developing a growth management strategy? Contact us. We’re happy to help.

Growth Management and Planning

As soon as a company grows from one person to two, it’s time to start defining roles. Every new hire should have a job description that is revised every year. Everyone should know who they report to, and their manager should have managerial control. As a business owner, if you don’t trust your managers to run their department, why not? Did you train them? Are they competent? Or are you just not ready to trust them? If you’re not willing to let them run their department, should you be paying that manager? Or should you replace them?

A company of 25 people cannot run the way their national competition does.  Run your business based on the size it is right now. Embrace the uniqueness, and build a business structure that capitalizes on it.

For more on how to build a strong foundation for your business, click here.