Wednesday, April 16, 2008

Workforce Productivity and Expectations

Entrepreneurs and business owners are easily frustrated with their employees over a number of issues. The most common is that entrepreneurs and business owners expect their employees to care about the business as much as they do. This is an unrealistic expectation, and learning this lesson can often be very costly. The internal controls of your business are crucial in preparing a business for success.

A picture in the USA TODAY on 4 April 2008 stirred the thoughts for this blog post. Although its focus is on the effect chronic illnesses can have on an employee's absenteeism, it underlines a broader point - employees add a stressful and often frustrating facet to a business. But, when it is managed correctly, employees will be the biggest reason why you can grow and succeed. In some ways, they become one of your most important customers. Every employee has a different set of objectives as well as current and future needs that they will look to the company to meet. Hopefully the company can continue to meet the objectives and needs of its employees, but sometimes this does not happen.

Let me share an example: Several years ago I hired a talented recent college graduate as a staff accountant in a large company. He had a bright future ahead of him, and we felt we could offer him the CFO career track and opportunity he desired. Within months he was asking for a raise and a promotion. I had clearly defined his compensation and career progression when he started with the firm, and his requests were far ahead of the agreed upon schedule. We could not afford to grant his requests because of the overall disruption they would have caused in our long-term plan. We had to part ways, and I believe both parties were better off as a result - he found a quicker career path, and we found a new person that was delighted with what we had to offer.

So, here is the take-away for business owners and entrepreneurs: set expectations up front and resist the temptation to grant concessions that will hurt the long-term plan of your business. As a company, you exist, in some degree, to help your employees accomplish their goals and objectives. When the company and the employee's goals and objectives fall irreconcilably out of alignment, then it is best for every one to part ways and move on.