At the recent Chamber of Commerce Business Expo, Haines Watts asked business owners and senior managers to identify their key business issues. Their responses were compared to those of Haines Watts’ clients nationally and some interesting conclusions were noted in the survey report.
For me, one of the most interesting findings was that business owners, both locally and nationally were concerned about the strength of their senior team. As noted in the report, this aligns with anecdotal evidence from myself and my colleagues who have found that many business owners feel that their businesses would suffer without them at the helm.
It isn’t hard to see the problems that this situation could present – a business reliant on one individual is extremely vulnerable. The health of the owner-manager is a concern both in terms of the stress of carrying the full responsibility for the business’ prosperity and because a prolonged illness or other enforced absence is likely to have a detrimental effect on the business.
The health of the business is also likely to suffer where an individual is so wrapped up in simply running the business that there is no time to take a strategic view of where the company is headed.
When the time comes, the self-reliant business owner may find it difficult to leave the business even when they’re ready to. A business reliant on one individual is not going to be attractive to potential buyers and their financial backers and, without a strong senior team, a management buy out is extremely unlikely.
So our survey respondents are right to be concerned and they are likely to have found that building a strong management team is a significant challenge. A Chartered Institute of Personnel and Development survey in 2013 found that 52% of businesses reported difficulties in recruiting at managerial level. This is likely to be compounded in rural areas such as Herefordshire as I have explored in a previous blog ‘All work and no pay’.
In addition to attracting talented managers there are further challenges in inspiring, motivating and retaining them. It’s not all about the money – business-owners must demonstrate that they are willing to let their managers take on responsibility and contribute to the strategic direction of the company. Naturally other incentives such as tax efficient share option schemes will also help to inspire long term commitment to the business and should be considered.
Haines Watts’ white paper ‘Your people, your business’ offers practical guidance on recruiting, retaining, managing and motivating staff and is a good starting point for those owner-managers whose New Years Resolution is to cultivate a management team they can depend on.
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