Tuesday, June 28, 2016

Your Staff is Too Bad to Keep, But Too Good to Fire.

I was talking with a friend in the insurance business yesterday.  He has an admin person in his office who is smart and skillful, but was taking advantage of her salaried position by leaving work to take care of personal things way too often.  It was affecting the efficiency of the office because others were having to pick up the slack.  The agency owner sat this person down and explained that he was happy with her performance while she was there, but would be changing her to an hourly pay scale to motivate her to work the hours that the agency needed her to work.  The admin person even agreed that it would be good motivation for her.  After a few weeks, the owner really noticed no change in her behavior.  It was just saving the agency money when she didn't work 40 hours.  The problem was still present though.  Others in the office were faced with an increased workload in her absence.  

I see this as a lot.  You have someone in your office who isn't as good as you'd like but too good to let go.  This is a bigger problem than you think.  A much bigger problem.  It can be like the butterfly effect of lost revenue.  What if your staff member is out and because you were short staffed, you had to focus on a service issue for a couple of hours.  What of during those hours you missed an important phone call or meeting that would have lead to a $50,000 commission sale.  There are 2 common choices.  Neither are easy.  You can fire the employee and spend the time finding and training someone else.  Or, you can try to motivate your staff with some type of ownership stake or profit sharing plan.  There's also a third choice, but first you have to realize that it takes a new kind of thinking.  Hint: It's a bit like the 2002 Oakland A's strategy.  More on this later.