There is an interesting blog over on the www.localbusinesspartners.co.uk site by my business partner arguing that whilst business coaching has clear merits, for many SME owners it cannot answer the practical challenges that they face because coaching has to end at the point where the work of changing things begins.
My partner Oli Randell who is a well established coach so can see the issuefrom several angles says:
“Owning and running a business is a real challenge, especially for owners evolving from being a manager to a leader.
This often happens around the £2m to £3m mark, when the business may have 10 to 15 employees and when the original customer base must be widened and diversified. The owner finds they can no longer see and touch every part of the business and it feels like it is starting to get away from them.
Owners find they are wearing too many hats to the point where improved business performance actually impedes growth.
The value of coaching in this situation is beyond doubt, helping owners to prioritise and organise their thoughts on how the business needs to develop. But after the coaching ends, who is going to turn an ideal into reality?
Growth poses simultaneous challenges in three areas, managing cash and profits; developing staff and skills; and presenting the right mix of products to an ever changing market.
The business needs not a better generalist but a specialist to take on finance, HR or marketing responsibilities.
But with a full time director costing perhaps £10,000 a month, it’s a critical decision that will also have immediate effects on the owner’s way of doing business and is beyond the scope of coaching.
A director should bring the experience of working for high performing companies as well as the passion of the entrepreneur for results. They should also provide intangible qualities like perspective and insight to spot potential.
To be successful, a director joining the company needs to be ‘joined at the hip’ with the owner but what if the chemistry turns out to be not what was expected during the interview stage?
Hiring someone who probably knows more about their area of expertise than you do isn’t easy and is something you might do only once or twice in a decade.
The alternative is to turn to a specialist advisory company such as a marketing agency or accounting practice but overheads and their need to focus on higher spending clients means that SMEs can be second tier clients when what is needed is committed, partner level support.
Faced with these cost and teamwork risks, a growing number of businesses are turning to part-time directors of finance, HR or marketing who operate as independent professionals, but it is a market that is not highly developed.
It may be possible to seek them out on LinkedIn or through one’s own private network, but you need on luck on your side to find the right skills available at the right time.
It is also possible to hire such expertise through an intermediary firm who take the risk out of finding and retaining the right expert. Such advisory firms should provide a quality framework, a substitute director if required and a diverse network of specialist experts who bring their own valuable local contacts.
As the founder of Local Business Partners I’d offer the following advice to business owners to help understand what they should expect from taking on a part time director of finance, HR or marketing;
Leadership: your focus should be leading your business not problem solving. Your job is now to add value long term by only doing the things that you alone can do.
Finance: You should no longer have to fret about the VAT return, instead you should have access to the management information to make decisive changes.
HR: Your business should develop a performance management culture that is easily understood by everyone and which guides how people are recruited, developed and how they leave the business.
Marketing: The sign of a high performer is to choose your customers, not to let your customers choose you. With a part-time marketing director you can reduce your marketing spend, develop more profitable customers and compete on level terms with bigger rivals.”
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