The Right Way to Hand Over the Reins
My wife and I think it might be time to bring in someone to run our ATM installation and maintenance business. We're nervous, because we don't know how to choose the right person or make the transition. Our employees are rather set in their ways, because we haven't managed them closely. At the same time, we're looking for faster growth. There are going to be major changes in our industry soon, and we want to take advantage of the opportunities they will offer. Any advice?
Entrepreneurs constantly get new ideas; it's part of the entrepreneurial affliction, and it's generally a good thing. But if you don't have the discipline to focus on one idea at a time, or if you get too far ahead of yourself, your bright notions can wind up doing more harm than good. The writer of this email--I'll call him Hank--was on the verge of making both of those mistakes.
Hank and his wife have been in the ATM business for 16 years. She does the bookkeeping, but he withdrew from day-to-day operations eight years ago to become a currency trader, a business he enjoys in part because he can do it on his own, without having to manage anyone else. As a result, his employees have grown accustomed to working with minimal direct supervision. They apparently enjoy it as well.
Now Hank is thinking about hiring someone to fill the leadership role. He's concerned, however, about alienating his employees. Meanwhile, he can see big changes coming to the ATM business, as smartphones make it possible to access the machines remotely. There's an opportunity, he believes, for his company to become a leader in supplying technology to ATM companies not affiliated with banks. He has been thinking the new person could work in business development while preparing to take over the company. "I'm looking," he said, "for a situation where I can pass the ideas and strategic planning in my head over to someone who can enact them."
I told him it was highly unlikely that he would ever be able to make that happen.
To begin with, it never works to bring in a new leader and insist on remaining in charge behind the scenes. What Hank needs is a manager, preferably one with experience exploiting opportunities like those Hank has identified. But he can make it clear to everyone that the new manager reports to him. The employees will feel comfortable knowing that they will still be able to get to Hank if they need to, and the manager will have time to get established without the burden of immediately taking full responsibility for the company. As for Hank, he can go on having great ideas.
NORM BRODSKY | Columnist
Street Smarts columnist and senior contributing editor Norm Brodsky is a veteran entrepreneur who has founded and expanded six businesses.