Quite a while back, we were three partners. We had 23 staff members. Then one partner left and we let him take a chunk of the business with him. Then the other left and we agreed that he would take a chunk of the business as well. Our turnover dropped by 45% over those two years. In the year ended December 2013, our turnover exceeded the figure before the drop. We had 7 full time staff members and 2 half time!

Not long ago, I asked the partner of another accounting practice what was his turnover and staff compliment. Turnover was similar to ours and staff compliment 18.

How can we do the same amount of turnover with less then half the staff compliment? We are, after all, a pure service business, so all we can sell is the product of our time.

Well, first off, I bet the other Chartered Accountant would say “all we can sell is our time”. That’s what we used to say. Then we got clever. The difference is called “productivity”. That is, what comes out for every unit of time put in. There’s always (yes always!) a better and quicker way to produce the goodies. That means that as our practice stands right now there’s a better way to produce everything that we produce. And that means that we’ve always got plenty to think about! So, lesson number one – constantly look for better ways of achieving the desired end result. (Note that I didn’t actually say “doing what we do” because what we do might not be the best way of achieving the desired result).

Only do good business. Back when we took on that third partner, he brought his clients with him. They were a pitiful bunch. Always complaining about price despite the fact that his pricing structure was way below ours, not paying their accounts, never satisfied. We were glad to see the back of them when he left. They took up so much of our time for so little return that they were a large part of the reason that we needed so many staff. And, of course, the constant complaints demoralised our personnel quite unnecessarily. Rather chose your clients/customers carefully. No business is better than bad business.

Next, train your staff. And keep training them. This not only equips them to perform better but it also motivates them enormously because the better someone is at something, the more they’ll enjoy doing it and the better at it they will become (note the positive cycle there).

Good is bad and bad is good! A particular character trait can be a huge plus for one task and a huge minus for another. For example, a staff member who loves to chat will be great on the phone to clients but a pain in the butt in the back office. Someone who is a stickler for detail will love maintaining your central database but will be useless in the marketing department. Bottom line is this – if your staff member has a positive attitude then your job is to put her in the job that suits her personality. What one person hates, another will love. That translates into “If you’ve got the right person in the right job, you’ll get the maximum results”. We move jobs around between our staff frequently, just as soon as we discover that someone is having to do something that they don’t enjoy.

Treat all of your staff as if they were volunteers. I forget who said that first, but it has stuck with me for a long time. Yes, I am critical at times, but then I would be critical of a volunteer if I felt that they weren’t up to scratch. What is not negotiable is respecting your staff, being interested in what they are doing, recognising excellence and sharing with them your ideas and plans so that they see purpose in everything that they are asked to do.

If staff don’t adhere to a system, chances are that either the system needs changing or they have not been shown how to use it or why it is in place. In August 2013 we implemented Sage CRM. One of its features is that it creates on-screen reminders of jobs that need attention. You can dismiss or snooze the reminder. The staff knew that they were not allowed to dismiss one unless they had dealt with it, so the reminders just kept piling up and up until they were completely ignored. Everybody was just too busy to deal with them. When I recognised the problem, I showed the staff how to use the snooze facility to manage their time. Either they could deal with the issue immediately or snooze it for hours or days depending on the priority. Suddenly what was an unmanageable pain became a tool of time management. This was a case of the system being good but the training being lacking.

Be careful how you use money to motivate your staff. See my earlier post on incentives.

If you are not interested in your staff’s personal lives then don’t make out that you are. They’ll quickly detect the “Hail fellow, well met” falsehood and it will be met with the contempt that it deserves. However, if you are interested, then by all means spend time chatting to them about their husbands, wives, children, studies or whatever. That is not time wasted. Equally, don’t expect them to work in isolation from each other. You may have to manage the amount of time spent chatting, but don’t try to take it away entirely.

I once bought a book called “Tough Minded Management”. Like so many books, it said it all in the first chapter and the rest was not worth reading (Richard Branson’s “Screw It, Let’s Do It” said it all in the title, the book itself added nothing). It pointed out that “tough” means getting what you want by whatever (reasonable) means it takes. It does not mean “hard”, “inflexible”, “demanding” or any of those things. In fact it can mean “soft”, “flexible”, “compromising” if that’s what it takes.

Above all. Be reasonable.

Post a question or a comment or, if you can find the time, come and see me. We serve the best coffee and I don’t charge for meetings.

Should you wish to make an appointment, please feel free to visit Derek’s diary and book a time that suits you.