Many years ago I read a lot of the small business advice written by Dr. Leon Danco, the founder of the Center for Family Business and author of numerous books, including the seminal “Beyond Survival: A Guide for Business Owners and their Families.” A lot of today’s small business consultants are here because Leon Danco paved the way.
Danco wrote that all family businesses had the same organizational chart. At the top was the owner, all the employees were equal to each other at the bottom, and in between the owner and the employees was a little old lady with a mustache. I’ve seen that organizational structure many times. Met some of the ladies, with and without mustaches.
I heard Gino Wickman, author of “Traction: Get a Grip on Your Business,” speak at the recent Nexstar Super Meeting in San Diego, and I was struck by how Wickman talks about the structure of a family business jibes with what Mike Agugliaro says in his column (page 43) in this issue about alignment. Mike writes:
“Alignment happens when all of your team is moving in the same direction: instead of just showing up for work, they are excited about performing at their very best for a shared goal, objective or target. You’ll save time, money and effort because your team will work together more effectively, and you’ll achieve and even surpass your business goals faster when your team is aligned.”
Too many contractors are too busy doing it all to even think about creating a scalable structure for their firms. A long-suffering spouse has replaced the little old lady with a mustache. Even when a contractor has hired a service manager, an install manager and a CSR/dispatcher and thinks that he’s created a structure, he still makes all of the decisions himself because he can’t let go.
Too many contractors are too busy doing it all to even think about creating a scalable structure for their firms.
Wickman has devised what he calls the Entrepreneurial Operating System, with six components: vision, people, issues, data, process and traction.
Like Agugliaro, Wickman asks if your people are all rowing in the same direction. He knows the answer: no. You have to create a vision and focus and communicate it to your people. Do you have a clear vision in writing and communicated it to everyone? Is your core business clear and do your processes and systems reflect that?
Your target market is clear, your short-term and long-term goals are clear, your differentiators are clear, and your marketing and sales people are saying the same things to customers all the time.
Nexstar President and CEO Jack Tester hammered that point home in his keynote address to his members: they are residential service and replacement contractors. That’s it, period. The good thing about that focus is that you know what to say yes to and what to say no to. When the home warranty company calls you, you say no. If you get the urge to move into residential new construction, you say no.
There are, no doubt, many contractors who don’t change because they’re scared. Change is scary. What if your managers screw it up? Maybe the 80-hour weeks will finally get to you and you have to change because you’ve hit bottom.
I was going to write an editorial about Wickman’s book but, as I got into it, I realized that there’s a lot more to it than can be said in a few hundred words. I’m sure many contractors will be dismayed to find Wickman describing shortcomings that sound all too familiar. Wickman’s book is a topic that I’m going to return to from time to time.