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Monday, March 19, 2007

Are You The One Who's Killing Your Company?

Interestingly company management has the ability to completely stifle their company's growth.

The Times has written a blog post that reveals how Sainsbury's was going down the tubes because of micromanagement.

The article introduces a book called Meaning Inc., written by Gurnek Bains. Bains tells the story of how Justin King (Sainsbury CEO) had the store managers in for a talk after he took over.

During the meeting he was impressed by their openness and willingness to ask questions. Then when they'd gone he noticed that one of them had "left" a sheet of paper. The sheet contained all the questions that had been asked during the meeting!

Senior management had scripted all the questions and the managers were so used to being micro-managed they'd gone along with the charade.

Needless to say things changed and Sainsbury's is now doing better.

There are so many stories like this that affect companies in large and small ways.

Let me give you a couple of examples from my own consultancy.

Case 1 - Large Industrial Giant

The team had been allocated to implement a project management process, project guide and associated software across multiple sites for the whole company. The team leader was so concerned to do a good job that he checked everything that the 4 man team created. That meant there was significant delays whilst he wrote up amendments or actually got round to reviewing work.

The result was at any one time most of the team members were twiddling their thumbs waiting to amend what they'd done. It also proved to be a problem with morale and the project petered out.

Case 2 - Group of Furniture Companies

There were 5 companies as part of the group and one financial controller to ensure that budgets were kept to. The controller also made sure that every single purchase order came through her office so she could personally vet each order and ring to make sure the item or items were really needed.

Whenever the controller was on holiday work slowed and in some cases orders of furniture couldn't be delivered on their scheduled delivery date because staff were unable to hire a van. In other cases orders for simple fixings such as rivets and screws were held up preventing the company building the furniture.

The result was a significant impact on morale and also a major problem for customers who didn't receive orders when they'd been scheduled.

What Lessons Can We Learn

Ask yourself are you micro-managing? If you are decide how you need to change.

Look at your business, talk to your people. Are there processes that stop them performing to the best of their ability?

Often people wont volunteer information to their boss about things that affect them. The reason is that they often think, with good reason, that it's career limiting. 

The one thing that any company needs is a regular business MOT where an outside set of eyes can look at what's happening to people, processes and principles and comment and recommend changes.

For example in the furniture group I suggested using call-offs for fastenings so that you could create an order at the beginning of the year of the total you expect to use and simply request more of the item as you needed it. I also suggested that they should give department heads budgets and that they needed to justify their spend at regular meetings.

Whilst not rocket science it points to Michael Gerber's mantra about working in the business and not on it - no matter what the business owner thought!

Who Can Help?

There are many, many people who are happy to interfere with someone else's business. That said there are certain groups of people I suggest you use and they include the following:

  • Successful entrepreneurs
  • Forward thinking accountants (not ones that think only about the bottom line)
  • Business growth consultants

Whoever you pick you need to trust them, you need to believe they'll give you the inside information as to your business health.

That means you must pay them, otherwise it just becomes a favour and they have no incentive to get it right. Also to do a business MOT properly you need them for at least 2 days on site for a small company, 1 week for a medium and 2 weeks for a large company. Anything less and they will miss stuff, maybe even the most important factor!

And if you find out you are micromanaging?  Get Help Now!


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