Is your management team too busy with the day-to-day operations, that they cannot step back and determine the future direction of the company? “Tactical busyness” is a common problem with the lean management teams in the staffing industry. They are so focused on the fires in front of them they cannot address long-term issues. This short term focus traps them in a reactive loop that undermines their ability to improve and direct the organization.
About a year ago I was speaking with a software vendor who needed help with an unhappy client. It seems the client purchased their software, but management took a very hands-off approach on its implementation. This lack of leadership led to very poor tool adoption and productivity actually decreased. In response, the leadership team blamed the tool.
This wasn’t a question of management being lazy or indifferent. As a matter of fact, these managers worked long hours and were very passionate about the success of the business. This is a great example of a management team that is so involved in the daily business that they do not take a hard look at what they should be doing.
The core of the problem is role confusion since many managers don’t understand their jobs. Oftentimes managers are held accountable to the wrong things which in turn leads to poor decision making. The traditional budgeting process is also a major contributor since companies focus on developing budgets and establishing financial goals, but very little time is spent on how management is going to make those goals a reality. A lot of time and energy is wasted on an excel document that is outdated even before it’s finished and yet makes the leadership believe they have done the work necessary to prepare for the upcoming year.
Financial goals are only the first step to developing your plan for the upcoming year. The true value of planning is driving clarity and accountability to the different management roles that will lead to those financial results. Here are some steps you can take to ensure your team is prepared for 2014:
Analyze Operational Trends: The management team must spend time combing through the metrics looking for trends that may pose a long-term threat to the business. This type of analysis should always begin with sales by analyzing the sales cycle from prospecting activity all the way to job order trends. Then, evaluate the delivery organization and look for areas that are poorly aligned with your sales strategy. Lastly, analyze the productivity ratios as well as new gross margin results for clients, sales, and recruiters.
Identify Key Issues: Key issues by definition are the areas that if fixed will have the greatest impact on financial performance. There are things to be improved in every part of the organization, and too often we choose to work on the most visible issues not the most important ones. The operational trends should clearly tell you what the management team must improve. Choose no more than three issues and if you can narrow them down further, then do it.
Workshop: Pull the management team together and develop your plan. A collaborative environment is where the root causes of the key issues can be defined and an improvement plan developed while simultaneously establishing buy-in from your key players. The plan should include improvement projects as well as metrics to hold management accountable. In addition, the improvement plan should define each management role and the metrics necessary to ensure the proper focus throughout the year.
Follow-up: Schedule monthly/quarterly management meetings to track the progress against the improvements. Use these meetings to review the metrics and coach the managers on their performance and spend time openly discussing the effectiveness of the plan. Collaborative planning pulls managers out of the weeds and adds a critical strategic element to their jobs that helps prepare the company for the future.
Management’s ability to balance what’s visible versus what’s important is a critical skill that must be developed especially for lean production driven businesses such as staffing. While taking this approach may take more time upfront, the short-term return is seen in focused high-impact improvements while the long-term return is a management team that is developing critical skills to drive company growth in the future.