Business Platinum Ventures: Fall 2002

Courtesy of American Express
Article written by Charles Slack, author of Noble Obsession: Charles Goodyear, Thomas Hancock, and the Race to Unlock the Greatest Industrial Secret of the Nineteenth Century
This article was the cover story of the Fall 2002 issue of Business Platinum Ventures and distributed to all its American Express Platinum Card members around the world.

Get out of a rut

Companies, like people, can get the blues. Sometimes, the cause may be obvious: a downturn in the industry, stagnation at a certain sales level, or the loss of a key client. Other times, malaise may creep in for unknown reasons. A company suddenly loses its edge, some of the enthusiasm and excitement that has always defined it; employees don't seem as fired up as they once were. When small businesses hit a rut, getting back on track starts with the owner.

Where ruts are a risk
Often, a sense of company-wide malaise starts with a business owner who has worked ferociously for several years to get a business under way, only to find that the fun and unpredictability have been replaced by routine. The business seems more and more like a bureaucracy: exactly what people try to avoid about the corporate world in the first place.

Joseph Sherlock, a small-business management consultant based near Portland, Oregon, says companies that start from scratch often struggle with this phenomenon when they reach $1 to $2 million in sales. "It's almost psychological," Sherlock says. "You start with nothing. You think, if only we could get to a million, life would be swell. Then you get to a million and things aren't so swell. That's a good threshold to start tearing your hair out."

By now, your core of a few people has expanded. You still know everybody, but that sense of family slips away, Sherlock says. The pressure increases again when you reach $5 to $10 million in sales. By now, you may struggle to remember the names of all of your employees. You no longer slip under the radar of larger competitors. Management issues take up more of your time, leaving less time for you to develop new products or services.

Back to where you once belonged
At both thresholds, business owners must take time to consider their desires and goals, to avoid being swept away by the demands of running their companies. Sherlock says, "You need to get out of the office, and think about stuff. Is this really where I want to be?"

If you are perfectly happy being a manager, then you may be happy presiding over a growing bureaucracy. But if you are a scientist, then every moment away from your test tubes and lab coat may be agony.

One alternative to growth-inspired ruts is to carve out a market niche and make a conscious decision to remain small. But while that may work for some companies, Sherlock says, it is important to remember that markets are fluid, and the rest of the world isn't going to stand still because you've decided against further growth.

"Most markets are growing markets," Sherlock says. "If you let competitors move in, they will eventually have better buying power. Ultimately, they control the market, and they start determining what you will do."

If you'd be happier back in the lab, start grooming your best employees for management roles, Sherlock suggests. That way, your company can grow while you do what you love. You can still exercise ultimate control as chairman. Of course, you must be serious about giving up control of day-to-day operations. That means trusting whomever you appoint, and resisting the temptation to micromanage.

Employee motivation
Owners aren't the only ones subject to ruts. Sometimes, a sense of malaise can begin to creep into the workforce when the owner thinks everything is going great.

"Owners and employees think differently," says John Seiffer, owner of The Small Business Coach, Inc., based in Connecticut. "Owners will often assume employees see the direction the company is going in, but they don't."

Unlike large corporations, where career advancements are structured and clear, small businesses have a more nebulous success ladder for employees. This can be an advantage, because of the flexibility it allows, but it can also leave employees feeling adrift if they don't have a sense of the possibilities open to them. Be sure to have regular discussions regarding not just current performance, but also what you see as that employee's prospects within the company. Such conversations must be followed up by positive action, such as training employees, Seiffer says.

"One solution to the ruts is cross-training. Have people learn how to do somebody else's job," Seiffer suggests. "You get to know a little bit about the workflow. It makes people work together."

Another step for keeping employees energized is to solicit their ideas for how to improve the business.

"Have a theme of the week. Maybe the theme is cost-cutting, or customer service, or new products," Seiffer suggests. "Give everybody a little pad of paper to write down ideas. At the end of the day, all of the ideas go up on the wall." Offer a small reward per idea, to be shared by everybody. "Most of the ideas won't be very good or practical, but it gets everybody thinking," Seiffer says.

And some ideas will be excellent. Be sure to respond to all the ideas, explain why some won't work, and institute those that will: employees become cynical about making suggestions if those suggestions are rarely enacted, Seiffer says.

Add a little humor
Could an epidemic of seriousness lead a business into a rut? Steve Wilson thinks so. Wilson, a Columbus, Ohio-based business psychologist, advocates the use of humor in the workplace to lessen stress and get the most productivity and creativity out of workers.

Something as simple as a bulletin board devoted to jokes and cartoons can lift people's spirits. Be careful, though, to set out clear guidelines. Inappropriate humor can backfire by demoralizing workers--or can even lead to lawsuits, Wilson warns.

Promote a happy workplace by introducing an "I caught a coworker doing something good" program. Instead of reporting mistakes, employees are encouraged to report and celebrate small actions that help the company but might otherwise go unnoticed.

Don't forget that the culture starts at the top. Don't be afraid to openly laugh at yourself and your own mistakes, Wilson says. You can be a thorough professional without taking yourself too seriously.


For help in keeping your company out of various ruts visit: This is the coach-matching service of the National Association of Business Coaches, and can help you find a qualified coach worldwide.

301 Ways to Have Fun at Work by Dave Hemsath and Leslie Yerkes has tips on injecting humor appropriately into the workplace.
Get Weird: 101 Innovative Ways to Make Your Company a Great Place to Work by John Putzier offers ways to transform your company.
The Art of Mixing Work and Play by Steve Wilson, M.A., discusses how to add humor to your office.