Personnel Power
Your highest
operating cost may be your people.
Certainly it can be the most powerful.
Even though they do not produce a product or service customers, your
people in other operating areas can make or break your performance.
- Bring in the right people at the right level in the right numbers at the right time. Know your biases. Realize where you know less and might be prone to over or under hire. Get feedback from your advisors or other outside experts about areas you are not sure about. Your CPA, for example, could help you understand when to bring in a controller or CFO. Check with owners at other companies. Get feedback from peer groups.
- Use part-time leaders to bridge your growth. Rather than going from nothing for a long time to eventually hiring an HR director, use an outside HR firm. Get the benefits of their knowledge without having to pay for it full time.
- Invest in training your other operating people just as you do for your people on the line. Keep tabs on what you spend on training. You may find it is very low. Ask yourself, is that really what you need to spend to keep your people on top?
- Anticipate ahead what new positions you will need as you grow. What skills will be needed? Do you have anybody in-house who could move up? Where might she fall short? What could you do ahead of time to build up those skills? A common area is people skills. People start in their careers as good technicians. They learn their craft. However, to move up, they need to learn how to work well with and lead people. A strong accountant may need supervisory training in order to step up to become a controller.
- Understand how powerful benefits can be. When you first start, your benefits will be limited. As you grow, revisit your benefits. Plan ahead for what you may be able to add when. What might you add in two years or five years? If you have not took a hard look at your benefits, get outside views from benefit firms or fellow owners in your peer group.
- Look at how your company operates. Does it make it easy or hard for people to succeed? Is it too chaotic and needs some structure as you have grown? Or have you gone too far, with so much structure that it makes it hard for people to do anything?
- What feedback do people get on their performance? It should not wait for performance reviews. How well do your leaders give feedback to their people? How well do you give feedback to your leaders? What do you do to know how your people are doing?
- Keep tabs on your total personnel costs. You need a supplement to your financials to show this as a separate schedule. Get the whole picture so you can watch for this creeping up on you.
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