Why a "Team" Anyway?
Shared Effort
Better able to survive departure of individuals
Better decision making (i.e., "2 heads are better than 1")
Credibility with investors, lenders, employees, and perhaps most of all -CUSTOMERS
How it differs from a "leader-led group"
Influences on Team Composition
Founder (e.g., style / experience / skills)
Opportunity (e.g., fast / slow / tactical / strategic)
Business plan (You DO have one, don't you?)
Outside resources available
Culture desired (new or sustained)
Management Team Skills Needed
Depends on the opportunity, but capability to...
Manage conflict
Resolve differences
Balance multiple viewpoints and demands
Build teamwork and consensus
The more long-term the issues, the higher in your organization you tend to handle them...
Good Hiring is the Starting Point!
Begins with a written job description
Sets expectations for employees and customers
Helps to value the position
Aligns responsibilities with authority
Make good use of:
Background checks
Reference checks (consider 2nd tier checks)
Probing interview techniques
However, sometimes the biggest mistake is not who you hire, but who you fail to fire!
Do Management Titles Matter?
Do you have an organization chart?
Prepare a chart for today and one for five years later
Assign titles to levels with consistency
Don't rush to fill top-level positions
Career growth (and reward) opportunity as you grow
Address peer-related relative value issues early
Aligns responsibilities with authority
Some of us believe titles are most valuable on business cards -often helping to open door
"Own" versus "Rent" (or Borrow?)
Applies to almost any asset in your business, including Management Team
"Own" = Hire / Employ
"Rent" = Contractor*/ Consultant*
Accountant / Lawyer / Banker / Insurance Agent
"Borrow" = Advisory Board
Pay them too (accountability)
Value experience from outside industry
Be accountable to your Advisory Board
* Beware newer, tougher IRS rules on independent contractors!!
Impact of Business Growth on Your Management Team
Must learn to delegate (remember to hire right!)
Know the differences between:
"Doing" vs. "Managing"
Managing employees vs. managing Managers
Are you running your business...or building an organization...or both?
What Management Trait Matters Most?
Integrity
Hard to assess at time of hire
Most commonly shows during a company crisis
Think values, not just skills, when hiring
"There's no right way to do the wrong thing!"
A Great Management Team Has:
Complementary talents / skills / experiences
Shared vision and passion (requires strong leadership and communication!)
Industry experience and contacts
Key functional areas covered:
Finance
Operations
Marketing
Able to commit time...and endure hardships
A quality, capable leader
Building Your Team -Mistakes to Avoid:
Forming the Team casually
Putting together a team with divergent goals
Using only insiders
Using family members
Giving founding team ownership instead of wages
Heavy reliance on one or two superstars
Beware the Peter Principle! The principle that says "in a hierarchy every employee tends to rise to their level of incompetence".