One of the greatest strengths (and liabilities) of owning a small business is that the actions of a single employee can have a direct impact on your bottom line. Mishandle the wrong customer and everyone in town will hear about it, but wow another patron and word will get around almost as fast. Most entrepreneurs don’t go into business because they have a deep passion for staff development and coaching; unfortunately, ignoring that part of your business may cost you opportunities to increase sales and open your net profits to heavy assault. Here are a few tips for increasing profits through staff development:
Hire for best fit first and best skill match second.
This principle is the exact opposite of how bureaucracies hire — but their existence does not depend on growth and profit—their model is based on maintaining status quo. Small businesses are much more dynamic, profit-driven organizations. So look for employees who share your passion, are interested in your mission, and who can contribute in more than one way. Most people can pick up a bookkeeping system or office procedure with a little training. Don’t disqualify interesting, versatile candidates because they don’t already fully know the job. Huge organizations seek specialists to fill narrow slots in their systems. Small businesses grow by leveraging versatile staff members who are eager to learn, contribute, and build their skills in multiple directions.
Create an atmosphere of continuous evaluation.
Reinforce positive behaviors and interactions with customers immediately. Instead of saying “Nice job,” provide a reason for your feedback. Start with, “Now I like what you did there, because…” Likewise, point out efforts that need correcting immediately and accompany your comments with a rationale that aligns with the mission of your organization. Instead of “We don’t do things that way here,” begin with “Remember that every interaction we have with a customer is valuable to all of our jobs. The next time a customer responds that way, explain that…” Whether or not you hold periodic performance evaluations, treat all staff interactions and observations as opportunities to impact your bottom line.
A strong, engaged staff is one of your best profit partners.
If you’re in a service industry, sales are made and lost by front-line staff. Manufacturing companies often see more innovations and productivity improvements from the floor than the front office. Actively create a workplace atmosphere where suggestions are encouraged, new ideas are solicited, and staff members fully understand their contributions to the mission.
Don’t prolong the good-bye.
Managers with considerable supervisory experience will likely agree with this statement: people do not fundamentally change. If you make a bad hire—and every human will—recognize it, make a reasonable effort to correct the behavior, and be ready to cut ties quickly if things don’t work out. Nothing drags down morale, and often ultimately your bottom line, than a bad hire who remains in the workplace.
Help is Available
Need more staffing tips or advising on any business topic? Contact your local Wyoming SBDC Network advisor for no-cost, confidential assistance with increasing profits through staff development by clicking here.
About the Author: Paul spent 25 years with an entrepreneurial-minded small business in the educational publishing market that attained an international footprint and experienced sustained, substantial growth. As a long-time member of the executive team with LinguiSystems, Inc., he served as Editor-in-Chief and Chief Marketing Strategist. Johnson most recently held the position of Instructional Technology Educational Specialist with University of Wyoming Extension developing and administering all of Extension’s online programmatic and educational efforts.