Business owners often think having a great culture means people simply like each other, but that’s only a piece of the equation. Culture can be defined as the point at which a company’s vision, mission, and values intersect. If everyone gets along but works 80 hours a week, you don’t have culture; you have a friendship club.
Culture is the driving force behind business success, but having an understaffed team greatly impacts a business’s chance of success. If your team is consistently overworked, it doesn’t matter how many great incentives or fun programs you’re offering them to make up for it, morale will suffer. If employees can’t get home to see their families at night or don’t have time to rest up between shifts, it will eventually show up in their work. In the long run, it will also impact the company’s profitability.
Every business can ask team members to go the extra mile at certain times; the skilled trades have busy seasons when heavier-than-normal workloads can be expected. During a planned growth period, a company’s capacity can be stretched as it onboards new employees, trains them, and teaches them how to fit into the company’s culture.
Sustained inefficiency and understaffing, however, are different – and the costs of those practices can add up quickly for business owners. Experts estimate the true cost of consistent turnover at about 150 percent of an employee’s annual salary. (See https://bit.ly/turnovercostsyou).
One key element of a thriving company culture is maintaining a trained, efficient staff at the right levels for your business. For contractors who have reached a plateau, strategic investment in employees can be a critical way to get to the next level of performance.
Start With the Numbers
There are quantifiable, proven, business growth guidelines. If you’re a small business owner starting to feel stretched and stressed, it may be time to assess your current situation and consider where you want the company to be a year from now, five years from now, and at retirement.
Start by tracking the company’s performance. Numbers don’t lie. Monitoring key indicators and consulting an expert can give you valuable insight into the business’s health and how to achieve your goals.
For instance, based on performance data, you may realize your operations have remaining opportunities for efficiency. Hiring won’t solve existing inefficiencies; they will grow with the business. Ensure you and your team get the most out of current operations before investing in growth.
If you haven’t been tracking performance indicators or want professional guidance on interpreting them, consider consulting a business expert specializing in the home services industry.
Time to Grow
Once you’ve reviewed your company’s situation and considered your goals, it’s time to build up your team. Remember that growth is an investment. Approach it strategically and build a staff that supports your goals. And be patient.
To win in business, you have to be able to play offense and defense. You must score and keep points off the board.
A growth-oriented team is more than just additional technicians. More techs mean more revenue, but building an effective support staff is just as important. They’ll ensure the techs you have work better and get more done, maximizing their potential in the field.
Your successful growth strategy should include team players who keep techs out there scoring points – employees who can transport parts and equipment when necessary, load and unload service trucks, maintain the fleet, and generally keep everything running smoothly.
Even with a team carefully designed to maximize efficiency and capacity, the initial growth period can test the patience and challenge the expectations of an energetic, ambitious owner.
As you approach the period of rapid growth, you will likely see profits drop. It can feel unproductive, but planning for this eventuality is essential. Expect it, and hold back earnings in the months preceding your growth phase, just in case.
Experiencing lower profit rates in the initial growth stages doesn’t mean the investment won’t pay off. As long as lower profitability remains in the expected range, depending on your company and other factors, it’s necessary for the process.
Stewardship = Success
“If you want something done right, you have to do it yourself.”
That’s one of the most dangerous limiting beliefs for a business owner. Elevating your company from a comfortable plateau to sustained success requires leadership based on a stewardship mentality.
If the company reaches the next level, it won’t be because the owner is putting in extra time on service calls on top of his other responsibilities. As the owner, you're building a high-value enterprise designed to last. A sustainable business depends on your ability to help your team become the best versions of themselves. That takes a different skill set and mentality than many home service business owners are used to, especially if they have extensive experience in the field.
However, stewardship is essential for building a culture where employees count. Investing in them is an investment in growth for everyone in your company’s orbit. When your team members feel valued and rewarded, that radiates throughout your company, resulting in a noticeable culture that will set you apart. Ultimately, that investment touches everyone around you, from vendors and distributors to, most importantly, customers.
Dustin Guyton is a head coach for Business Development Resources (BDR), a business training and coaching provider to HVAC contractors and distributors.
He has owned and operated a contracting business for over a decade, achieving an impressive revenue milestone of over $10 million. Dustin's impact extended to coaching and corporate training, where he worked with diverse businesses, including a successful Fortune 500 company. To learn more, http://www.bdrco.com/.