Many business owners I work with to improve the operation of their business’s performance commence the engagement by explaining to me that their problems would be solved if they only had a particular piece of equipment or an extra $10,000 in the bank. With these assets, they could then supply more products or services, sell them to their customers – and all their problems would be over! In almost all cases, buying additional equipment or borrowing extra funds would ensure the business owner goes broke and the next time we read about them is in the TCS Trade Gazette.

As we proceed further into the business we quickly realise that the major issue is poor management of people – not insufficient cash of plant and equipment. When we are able to address the people management issues, the business starts to improve – and improve rapidly. It is not unusual to find that, even before the end of the business improvement project, that profitability is already beginning to improve. What has happened is that the minds of all those working in the business has turned to business improvement – not just the mind of the owner operator.

Invariably, as business owners and operators, the asset that can make the most significant contribution to our success or downfall, is our people. The smart business operators hire people for both their hands and their minds – the others only employ people for their hands – just a way of getting the job done.

Unfortunately, we are not born brilliant managers. We need to make a conscious effort to learn the skills required to be manager. We have often heard the phrase ‘management by pillow osmosis’, that is, people, prior to taking up a management position (and this often applies to owner/managers), go to bed at night as an employee and wake up the next morning as a manager – miraculously turning in to a manager overnight. Just because you own the business does not make you the best person to run it. This applies to all businesses – lawyers, accountants, doctors, retailers, manufacturers and the like. As a consultant, I have often had the onerous task of pointing this out to the business owner (who, at the time is also my client) that the poor performance of their business is almost solely due to their ineptness and unsuitability as a manager of people.

Quite often small business operators commence business as a sole employee and grow their business because of their superior technical skills to the stage where they need to employ others to meet customer demand. Many business operators automatically believe that because they are good technically at their business, they are also good people managers – usually this is far from the truth!

So the message is, before you move into a position of management, and particularly if you operate your own business, undertake some training in people management, particularly in the areas of: understanding human behaviour, communication, conflict resolution, negotiation, motivation, managing change and time management.

Finally, the golden rule in management is that, if you cannot manage these things in yourself, you have no chance of managing these things in your workers. It’s a wise person who knows their own limitations!