The way I ended up becoming an entrepreneur is a typical story. I got fired from a career I loved and had been good at for 14 years. I had to figure out how to put food on the table and ran into a good friend who I had known in my previous career. She invited me up to her house so we could ‘brainstorm’ what we could do and the rest, as they say, is history. Our company successfully grew in spite of ourselves. The first 3 people we hired were people we knew as friends who were eager to come on board and help us ‘figure it out’. There was little pay and a lot of promise but we were creative and capable.

We took risks, we learned new things on the fly based on requests from our clients, we never said no. We worked 24/7  in those early years, developing a reputation that would serve us well. But it wasn’t always fun. And we churned through some very good people because of the chaos that my business partner and I took for granted and actually thrived on.

The main lesson we learned was that starting a company was a cake walk compared to the challenge of growing a company.

Over the past 8 years, I’ve helped CEOs become more aware of the concept that as a company grows, it adds complexity. That complexity is created by people, not revenues or profits. I’ve talked to thousands of business owners about how their company moves through these different stages of growth based on the number of employees. The recognition that a Stage 6 company with 96 – 160 employees requires a leader to address different challenges, a different focus, different leadership styles and competencies has been my focus as I traveled across North America educating business owners on this unique and effective model.

Recently, however, I became intrigued in identifying different management ideas that are more effective at one stage of growth than they are at another. I’m calling this concept: Managing by the Numbers.

Here are some ideas for a CEO who is running a company with 1 – 10 employees that might be worth considering.

Stage 1: 1 – 10 employees

#1) Family ties: As a Stage 1 company, it’s standard practice to ask employees to work overtime and pay them for it. But a *CEO in Ohio felt strongly that if an employee has to work overtime for a long stretch, that money alone isn’t enough. This CEO knew that when an employee worked long hours, family and friends suffered too. His answer was to send flowers and dinner coupons directly to the employee’s spouse or to a friend, along with a personal note that said: “When somebody works hard, it’s hard on everyone.”

#2) It’s in the mail: According to a *company in California, opening the mail became a company-wide affair. This $1.2 million manufacturing company has all employees sit down each morning and open the mail — a task that only takes about 45 minutes. The delight in seeing a new purchase order, or a payment come through gets witnessed by everyone. If it’s a bill from a supplier, they look to see if there are ways of lowering it in the future. It may seem like this is a waste of a CEOs time, but according to this CEO, it provides together time where other issues are discussed, leaving everyone feeling connected and a part of the company in a positive way.

#3) The man on the street: If you are looking for unskilled or entry-level employees, one way to find them is to pay attention to the general public. A *CEO of a small firm in Boston, considers everyone he meets a possible employee. When this CEOs car broke down during a late night snow storm, he walked until he found an off duty cab driver. The sympathetic driver interrupted his coffee break and took the CEO home. The CEO was so impressed he offered the cabbie a job as a driver for this company. Today that driver is a marketing specialist. Never overlook the people you interact with every day. If you know what you want in an employee, you may see them in places you never expected.

The ability of a leader of a Stage 1 leader to understand that adapting to the needs of the company will serve that leader well as he/she grows their company, is the basis for creating sustainable and profitable enterprises. By understanding the Stages of Growth, made popular by James Fischer’s book “Navigating the Growth Curve”, you will be better prepared to meet the growing needs of your company.

Watch for other blog posts on management ideas for the other 6 stages of growth.

*301 Great Management Ideas, Sara Noble

Seemed like we looked around one day and our small start up had grown up overnight. At 4 employees, looking to hire our 5th, we had had to find some new space as the basement of my business partner’s house just wasn’t working anymore. The space we rented seemed huge by comparison and I can remember to this day the angst we felt when we signed a 5 year lease on space that had the potential, if planned right, to hold up to 25 – 30 employees. Never in our wildest dreams did we think that day was just a few years away.

Our problems magnified as we had to find a telephone ’system’, move away from Macs to PCs (we landed IBM as a client and it seemed the right thing to do), configure office furniture, and move away from ’sneaker net’ to networked computers because we were no longer in one big area where we could yell for help. Our company started looking like a company and we started to feel the need to put processes in place — something we just weren’t inclined to do because it all felt too ‘managed’.

As you start a company from scratch, you are living off adrenline and the rush you get when clients actually start buying what you sell and money starts coming in ahead of expenses. Looking back our foray into a Stage 2 company with 11 – 19 employees happened in a blink of an eye. We went from start up to ramping up for growth and we just weren’t prepared for the complexity that adding employees created.

Over the past 8 years, I’ve helped CEOs become more aware of the concept that as a company grows, it adds complexity. That complexity is created by people, not revenues or profits. I’ve talked to thousands of business owners about how their company moves through these different stages of growth based on the number of employees. The recognition that a Stage 6 company with 96 – 160 employees requires a leader to address different challenges, a different focus, different leadership styles and competencies has been my focus as I traveled across North America educating business owners on this unique and effective model.

Recently, however, I became intrigued in identifying different management ideas that are more effective at one stage of growth than they are at another. I’m calling this concept: Managing by the Numbers.

Here are some ideas for a CEO who is running a company with 11 – 19 employees that might be worth considering.

Stage 2: 11 – 19 employees

At this stage of growth, it’s all about turning a profit. You have to start delivering on your promise and begin building a sustainable profit plan.

You also just experienced what is referred to as a Flood Zone, one of two ‘chaos zones’ that companies move through as they grow. A Flood Zone requires you to bear up to an increase in the quantity of activity. Your first reaction to a Flood Zone is to add more people. Don’t.

Instead, as you Ramp Up in Stage 2, you need to be focused on Profit/Revenue, getting critical processes in place and avoid the trap of just ‘throwing people at your problems’.

You probably haven’t spent time thinking about ‘managers’ or shifting the responsibility of managing these 11 – 19 people – you are not only trying to keep them on target with projects, but you are still doing everything you’ve been doing since you started your business.

#1) Suggestion sweepstakes: Suggestion boxes almost never work. They just require too much adminstrative involvement. The paradox is that employees do have good ideas and getting them to share them is worth your time. One idea that worked for a *remanufacturing center, involves setting up a specific program of limited duration, say 6 weeks, with rewards for the best idea each week and a grand prize at the program’s end. You may not come up with a $2 million savings idea like the remanufacturing company did, but you will certainly get great ideas and improve morale.

#2) Extraordinary efforts: Showing your employees how you value their contributions is critical and a *tire service company in New York went the extra effort to show how much they valued the hard work their employees put in day after day. Every employee who has worked for the company for two years or more is entitled to take his or her spouse or significant other to one of their local resorts for an expense paid weekend. This annual benefit is looked forward to by all eligible employees and they know they are sharing the rewards of their hard work.

#3) Financials 101: Sharing an income statement and balance sheet with employees, at this early stage of growth, will pay dividends as the company grows. Breaking down line items with detailed explanations helps employees make sense of this tool — usually reserved for the CEO and their accounting staff. A company’s *CEO in Connecticut heard one of his employees complain that the income statement was just numbers. Educating each employee on what the expenditures are, as well as definitions for things such as breakeven, cost of goods, gross and net profit helped every single person in the company start to see the relationship of their job to the bottom line. Now employees eagerly await monthly and quarterly reports and discussions about savings and where they can generate more income are normal.

As the leader of a Stage 2 company with 11 – 19 employees, your challenges are unique to your stage of growth. It stands to reason that managing a company with 19 employees demands different leadership skills than when you were a start up. By better understanding the Stages of Growth concepts, made popular by James Fischer’s book “Navigating the Growth Curve”, you will be better prepared to meet the growing needs of your organization.

Watch for other blog posts on management ideas for the other 6 stages of growth.

*301 Great Management Ideas, Sara Noble

I distinctly remember someone telling me when we reached and exceeded 50 employees: Your world will totally change now that you have more than 50 employees! That was usually delivered with a small smile of knowing, like they were sharing a secret that I should have known about. I didn’t. Nor were they forthcoming in explaining what would change or how it would change.

All I was aware of was the daily struggle to stay on top of the challenges that came with running a business. Adding to that frustration was the added confusion about what those challenges were exactly. I was aware that it was harder to keep our clients happy; it was more difficult maintaining profitability and certainly it was harder motivating our workforce.

Over the past 8 years, as I have talked to thousands of CEOs, and taught them the value of the ‘language of growth’, I realize how much easier it would have been if I had been able to articulate those challenges in ways that the entire company would understand. The 7 Stages of Growth, a research study by James Fischer who uncovered the concept that as you add employees the complexity level of your organization increases and that by understanding these different stages of growth, a CEO would have a better handle on what was expected of them. In fact, the 7 Stages of Growth allow a CEO to actually predict how growth will impact them.

We blew through Stage 5 very quickly and chose to ignore staff training as a critical challenge that raises its head when you grow to 58 – 95 employees. We were moving so fast that we were lucky to do some type of new staff orientation. We then relied upon a philosophy that might have sounded like this: We know you are good, so ask questions when you don’t know something. A well thought out staff training program would have served us well, would have helped us keep employees and would have eventually helped us increase profits.

I have recently become intrigued with identifying different management ideas that are more effective at one stage of growth than they are at another. I’m calling this concept: Management by the Numbers.

Here are some ideas for managers of companies with 58 – 95 employees that might be worth considering.

Stage 5: 58 – 95 employees

At this stage of growth, you need to recognize the importance of integrating your different teams into a cohesive group. Improving sales is your top challenge because you now have a much larger workforce, you are recognizing that larger and more complex systems are required, hence the need to be very concerned about your ability to cover your overhead. Profit, therefore, is your top gate of focus and as a leader, developing competencies that include conflict management and teamworka and collaboration will serve you well.

1) Eliminate company cliques: Integrating the more creative types into an organization can be a challenge. Software engineers, copywriters, scientists and art directors, sometimes march to a different drummer and that can cause headaches for managers. Instead of isolating these creative groups, one $5 million company in Massachusetts, integrates its business and creative divisions. Each Friday, one of the scientists gives a presentation to the company at large, on subjects ranging from his own in-house work to a new development in biotechnology. Once a month an employee from sales, marketing, strategic planning or administration takes a turn. The company also runs a weekly in-house seminar called “Science for Non-Scientists. Helping all employees recognize the value each area contributes is one way of eliminating company cliques.

2) Prime rib vs pizza: If you want your employees to focus on performance, it’s all in the way you deliver the information. One creative idea came from a 70-person company in Iowa. If the company has a so-so month, the CEO orders pizza. But if the company has done well, the employees get to choose the cuisine. The CEO uses these monthly sessions to talk about the financial performance of the company and if pizza is on the menu, the conversation is about why sales are suffering or expenses are up. This is also a great opportunity to open the floor and solicit input from employees and get the team focused on prime rib for next month.

3) Temporary executives: Flexibility is the name of the game in a challenging economy and many organizations have taken to hiring temporary employees to staff positions. A manufacturing of telecommunications equipment recently took that concept to their executive level. They hired a temporary marketing executive to create a marketing strategy and develop an ad campaign for their newest product. By utilizing temporary help at a more executive level, the company saved thousands in salary and benefits and still got the knowledge of a seasoned executive.

As the leader of a Stage 5 company with 58 – 95 employees, your challenges are unique to your stage of growth. It stands to reason that you will need to develop different leadership skills as your company changes and adapts. By better understanding the Stages of Growth concepts, made popular by James Fischer’s book “Navigating the Growth Curve”, you will be better prepared to meet the growing needs of your company.

Watch for other blog posts on management ideas for the other 6 stages of growth.

*301 Great Management Ideas, Sara Noble