At the center of every small business management team is the owner, whose primary long-term responsibility is to manage the company effectively. While some companies have several people who function in this capacity, this discussion will assume that an on-site entrepreneur/owner runs the business. Traditionally, this individual oversees the entire operation and personally looks over most company work, both in the office and in the field/plant. Furthermore, the owner is commonly a jack-of-all-trades, wearing the hats of many different employee roles.
The “Jekyll & Hyde” Theory
It is often asserted that the individual who single-handedly runs a company has a certain, identifiable “Jekyll and Hyde” personality. In demeanor and approach to problem-solving, the typical owner ranges from brilliant to tyrannical. An effective strategic plan must therefor encourage brilliance while keeping the owner away from problems that transform him or her into an ineffective manager. The same qualities that have enabled the owner to gain insight into many facets of the business operations are the exact ones that force him or her to be involved in every decision, major or minor. Such overt care and concern for the company is to be anticipated and applauded. When it results in ineffective management, however, a remedy must be devised.
Entrepreneur or Manager?
Efficient businesses require in-house management. Unfortunately, the skills that make an owner a successful entrepreneur can be at odds with those that make one an effective manager. Excellent entrepreneurs have great sensitivity to market changes. However, when they leave the daily operations to become managers, two things happen: 1) they stop using their innate skills, and 2) they manage ineffectively.
Though the owner may experience periods of fear or apprehension, as a group owners are generally optimistic and opportunistic. Good owners emanate confidence, motivating those around them. For example, by spotting a mismatch between market demand and supply, a good one can inspire employees to work towards meeting that demand. Uniquely able among executive team members to downplay the importance of minor setbacks, savvy owners emphasize the company’s forward movement in a vision casting mode.
Finally, first-hand knowledge of company history sets the owner apart. Having founded the company, the owner as entrepreneur is an indispensable part of the management team. When questions arise concerning company history or past performance, as they frequently do during times of tension, who better to turn to than the individual who has owned or managed the company all the while?
The Owner’s Vision
In providing vision for the company, the owner is expected to identify opportunities to pioneer new markets and expand the company’s presence in existing markets. Thorough identification of precise product offerings and internal procedures to make the products is a large part of every owner’s job description. The interaction between market research (including trends, buying patterns, and demand) and company vision is a relationship that the effective entrepreneur manages on a regular basis.
The entrepreneur can help the management team by maintaining personal relationships with key parties such as sales people and lenders. If links have been formed based on good rapport with these parties, it is only fitting that these relationships continue when they cannot be successfully turned over to another manager. This scenario rings particularly true with regard to negotiations with suppliers. The owner’s involvement in handling these parties is essential to reinforcing profitability.