Adjust the Management Style for the Situations.

Adjust the Management Style for the Situations.

Generally, business owners will keep a consistent management style. This is natural. Owners tend to do what feels right for them and mirror their own personalities. However, all businesses are not the same, plus the economic environment changes. As a result, one style generally will not maximize financial success over the long term. Below is a table comparing the two basic management styles and the situations in which they tend to be successful. The art is in the ability to adjust to a point SOMEWHERE IN BETWEEN the two extremes. Recognizing them is a start.

  • Collaborative Management: When the demand for talent is high and the best people are hard to find. For high growth economic times; new ventures and greatly expanding markets. When diversification or growing market share dominates.
    • Demands that employees think and come up with creative solutions to problems. Looks to the next change in the business environment and has the staff come up with internal modifications that will be needed.
    • Define and monitor only the key metrics. Watching pennies will lose you dollars.
    • Motivate with a desire for gain. Structure Pay-for-Performance Plans for the long term with individual AND group success components. Report continually. Payout quarterly or semi-annually.
    • Train and develop raw talent BUT learn to recognize it. Don’t rationalize. Hire slowly and methodically.
    • Management meetings should be short and motivational. Praise people in public. Establish project teams and promote bottom-up reporting.
    • Teamwork is highly valued in that it leads to necessary innovation
  • Autocratic Management: When jobs are scarce and talent is readily available. For recessionary times; mature and contracting markets. When margins are thin, or with commodity oriented industries. When productivity and cost containment dominates.
    • Does not want employees to think. Wants employees to obey. Does not encourage diverse opinions or suggestions. No suggestion box. There is only one right way of doing things, proven, tried and true.
    • Monitor everything. Keep a high level of control. There are only lots of pennies: They make up the dollars.
    • Motivate with a desire for gain AND a fear of loss. Structure Pay for Performance Plans with a short term view. Rewards and penalties. Report continually. Payout and penalize weekly or monthly.
    • People are available. Hire a lot; put time into training, BUT fire failures fast. Expect and accept high turnover.
    • Management meetings should be short and informational. What’s happened; what’s needed; what’s expected. Top down reporting.
    • Teamwork is not highly valued. No project teams since they will cause deviation from standards.

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After a long career in the corporate and small business world, Mike Cefola is the Regional Director for Partner America. A native of Pittsburgh, Mr. Cefola spent most of his career building new sales organizations and fixing those that were under-performing. Since joining in 2004, he has provided help to over 700 small businesses.