Are You Wearing Too Many Hats?

Are You Wearing Too Many Hats?

Owner’s time is too valuable to squander on routine tasks

By Joe Ciccarello, CPA, MST, Managing Partner, Gray, Gray & Gray, LLP

Every business, including Oilheat and propane companies, should have an organizational chart that defines who’s in charge, who manages each department, and who reports to whom. It’s an effective way to assign responsibilities and to make sure nothing “slips through the cracks” without being addressed and managed.

The challenge facing many energy retailers today is that too many of the slots on the organizational chart are being filled by the same person – the business owner. This is diminishing the owner’s ability to keep an eye on the “big picture.” According to a 2012 eVoice SMB survey, 90 percent of business owners are juggling three or more roles, while 44 percent report filling five or more employee roles on a daily basis. It is difficult to manage the workforce if you are the workforce.

Resistance to Change

Why is so much responsibility ending up on the desk of the business owner? In many cases the owner feels as if he or she is the only person with the experience and skills to do the job properly. And they are right, because the people with whom they have surrounded themselves are holdovers from a previous era and way of doing business. We have all seen a longtime employee, perhaps a favorite of the owner’s father, who has been doing the same job, in the same way, for decades. Yet some company owners are reluctant to reassign, retrain or remove underperforming employees.

As difficult as it may be, that system needs to be scrapped. The role each employee plays in keeping a business running has evolved over time, but not all companies have kept up. Changes in the way businesses are managed, brought about by advances in technology and significant shifts in the marketplace, have been outpacing the ability of many companies to effectively manage their human resources.

Every employee brings different value, skills and experience to a company. It is up to the owner to assess the needs of the business and address them with the best people. Longevity in a position can be a positive, but only if the person has grown with the role. Only by making the difficult changes necessary to put a workforce in place that is adaptable and dynamic will you, as the owner, be able to stop “putting out fires” and redirect your focus to managing growth and profitability.

The Owner’s Role

What should your role be as a business owner? There are three levels of tasks on which you should concentrate. At the top is strategic direction. You must lead the company in the right direction by focusing on the future. You decide how the company will grow, how resources (financial capital and human capital) will be allocated, and what the business will become in five, 10 or 25 years.

The second level is more tactical: determining the best ways to achieve the goals you have set. This includes analyzing sales and financial trends, setting benchmarks for performance, managing infrastructure (such as personnel, equipment and materials), and budgeting. It may also involve larger decisions like mergers or acquisitions, expansion, or adding new product lines.

The third level is managing the company to meet specific objectives. This includes prioritizing workflow, assigning tasks, managing employees and overseeing critical functions like customer service, marketing and cash flow. All must be driven and directed by the strategic and tactical decisions made for the future.

Your Time Is an Asset

What is the solution to wearing too many hats? Look at your own time as an asset of the business, and it will become clear that filling minor roles is a poor utilization of the asset. You would never send a $150,000 delivery truck out on a service call when a $25,000 van was available. You need to make some tough decisions about employee performance and cut away “dead wood” staff members who are not contributing to the bottom line. It may also require hiring new, more capable people, or outsourcing some functions that could be done more cost effectively outside the office (such as bookkeeping, payroll, or IT services).

Keeping your eye on the road ahead is easier and more effective if you don’t have five hats flopping down to obscure your vision. Trusting your staff to do their jobs – or hiring people you can rely on to do the work – can free you up to focus on managing growth and profitability in the years to come.

Pin It

Comments are closed.