Lessons I'm learning from the auction business

Since getting my auctioneer's license earlier this year I have yet to list my first auction.  This is a tough area in which to break into the auction business as we have dozens of auctioneers in a small geographic area.  Despite the large numbers of auctioneers four of them dominate most of the auction business.  Everyone else is left to fight over the remaining auctions that those four do not get.  I've been fortunate to have had the opportunity to work for several of the area auctioneers, including two of the main four, and I've learned a lot about the business that has applications for any small business.

A couple of weeks ago I worked a six hour auction for one of the primary auctioneers in the area.  I could not believe how much came out of a relatively small house that was to be sold that day.  It took six hours of hard selling, at times running two rings, to get everything sold, but at the end of the day both the seller and the buyers were pleased.  We were focused on what we were doing, and we worked hard to make the sale a pleasant experience for everyone, and we succeeded.

Contrast that with another sale I attended a few months ago.  This sale had a number of consignors with one person providing the bulk of the sale items.  The items he brought were also much more highly desirable than most of the other items we sold that night.  At the end he was not pleased with how the sale ran.  He felt too much time was spent selling less desirable items while some of his merchandise was left unsold at the end of the sale.  I would agree with his assessment.  People were allowed to spend too much time describing items with little value which not only meant that there was not time to sell everything, but people became bored and began to leave.  Fewer buyers mean less bids which means less money for everyone.

I attended an auction a few weeks ago that had a lot of desirable items for sale.  I purchased a number of them to resell in my antique and flea market booths.  The sale was conducted by an auctioneer that was engaging and who had a crew that knew what they were doing.  They moved a lot of merchandise that night, and I would think that most people left there feeling good about the sale.

The week before that auction I was asked to auctioneer at an auction house when their regular auctioneer could not make it.  When I arrived I was amazed at the poor quality of the merchandise they were going to sell that night.  Much of it was junk.  A decent crowd showed up for the sale, but few of them were bidding.  It was very hard to get more than a dollar or two for anything we sold.  We could not get a bid on several of the items.  After about an hour the owner of the auction house asked me what I thought we should do.  I responded, "I would shut it down.  Neither you nor anyone else is making any money here tonight."  That's what he did.  I've been told since that they have closed the auction house at least for the remainder of the summer.

What lessons can be learned from these various auctions?  One, regardless of what business you are in, you have to sell quality goods and services.  There are some people attending auctions looking for cheap items they can buy and resell to make a little money on, but even these folks have a threshold they won't cross.  Even junk buyers won't buy some junk!  If you cannot sell quality items or provide a quality service, you will not be successful in any business venture.

A second lesson is that you need quality people in your company.  I know many auctioneers who would have taken two or three sales to sell what we sold in that one six-hour auction.  The reason we could sell that much merchandise is because of the quality of the people that auctioneer has working for him.  I was the least experienced person there that day.  Everyone knew their role and knew what needed to be done.  The difference between satisfied clients and dissatisfied ones is often the quality of the people who work for you.

A third lesson is the importance of having a good reputation.  The best auctioneers attract the best merchandise because they have the reputation of getting top dollar on what they sell.  If someone needs to sell an estate or has good quality items to consign, they will automatically go to the person they believe will get them the most money.  Some auction houses are known as $2.00 auction houses because that seems to be what they sell a lot of merchandise for.  These companies are unlikely to get a lot of quality sales with that type of reputation.  I have decided to not do any more auctions for that last auction house I mentioned even if they do re-open because I don't want to be associated with that type of company.  These are nice, Christian people, but they do not know how to run an auction business, and I don't want to get the reputation of being a $2.00 auctioneer.

The final lesson I'll cover in this post is the importance of being a people person.  Auctioneering, like most business endeavors, is about being good with working with people.  The best auctioneers I've met have been outgoing, friendly, and honest in how they deal with people.  On the other hand, I've seen some who are petty, unfriendly, and less than honest.  Some seem to be very insensitive towards their buyers which I do not understand.  Why would any business person want to alienate the people who want to give you money?

Fortunately, I have a good job that gives me the freedom to break into this business slowly.  I hope I'm learning a lot about the business that will do me well when I do get my first auction.  If you have an estate in southern Indiana or some good quality items you want to consign at auction, get in touch with me.  I do believe you'll be pleased with my service, and you'll be hard pressed to find anyone who will work harder to make your sale a success.

How do you motivate your team members?

I just finished reading The Carrot Principle: How the Best Managers Use Recognition to Engage Their People, Retain Talent, and Accelerate Performance [Updated & Revised] written by Adrian Gostick and Chester Elton.  The book is based on a ten-year study of 200,000 employees and managers in the area of how to best motivate their team members.  The results of their studies found that "the central characteristic of truly effective management - the element that shows up time and again in every great workplace - is a manager's ability to recognize employees' talents and contributions in a purposeful manner."

I think there are three kinds of leaders in the workplace today.  One group does nothing in the area of motivation and recognition.  They believe that the paycheck the employees receive each week is all the motivation they need.  A second group would like to do something in the areas of motivation and recognition but do not know how to go about it.  When they do attempt to do something it is often awkward for everyone involved and usually fails to be very motivational.  The third group is committed to providing a workplace where people's efforts are recognized and rewarded in a way that is motivational to everyone.  What is exciting about this book is that it has something to say to persons in all three groups.

Their study found that effective leaders were seen by their employees are strong in four areas: Goal setting, Communication, Trust, and Accountability.  When recognition is added to these four areas "it serves as an accelerator of employee performance and engagement."  I wished I had understood this better when I owned a small business a few years ago.

I would probably have put me in the second group.  We had good employees, but I did not intentionally recognize their extra efforts as much as I should have, and when I did it was usually somewhat awkward for them and for me.  I was never certain of what kind of recognition was appropriate.  Probably my efforts were more demotivating than they were motivating.  I have no doubt that my leadership would have been much improved if I had read this book when I had the business, and I have no doubt that our company would have been much more productive and profitable if I had properly recognized our employees in ways that would have encouraged them.

If this is an area in which you struggle you really need to read this book.  Near the end of the book you'll find 125 different ways to recognize your team members.  That information alone is worth the price of the book.  You can find out more about it or order it by clicking on the above title.

How many options are there?

One mindset that often limits our success in any endeavor is to think that we must choose between two options.  As a church leader and as a business owner I would have people ask, "Do you think we should do this or that?" referring to two possible ways of addressing a situation.  Unfortunately, I seldom explored other options and suggested they take one of the options they suggested.  Had we spent more time examining the situation and thinking about other possibilities we may have identified a much better solution.

We need to automatically assume there are more than two solutions to any challenge.  There may not be, but our organizations would often be better served if we at least began with that assumption and spent some time brainstorming what those options might be.  How much better would it be if we could identify seven or eight possible ways to address the issues that challenge us?  We would have a much better chance of identifying the best possible way of dealing with it.

The flip side of this, however, can also be a problem.  We don't want to spend so much time analyzing a situation and pursuing different ways of responding to it that we suffer "analysis paralysis."  If I am on a ship that develops a major leak I am going to do whatever I have to in order to immediately slow down the amount of water coming into the ship.  We can spend time later deciding how to best correct the problem permanently and how to prevent future leaks.  Right now we just to make sure the ship doesn't sink.  If a major event threatens our business we need to throw an immediate fix on it and then take time to study how it happened and determine the best permanent fix.  Fortunately, most of our challenges are not so threatening or immediate, and they allow us the freedom to consider various options before dealing with them.

One of my favorite coaching questions that I use with my clients is, "That's one option; what are some others?"  It's a question you can use to self-coach or to ask members of your team when they come to you with issues.  Refuse to allow yourself to settle for one or two options to any challenge.  Intentionally see if you can find at least ten possible ways to address every issue.  Even if you don't get to ten you'll probably identify more than one or two, and that will make it more likely that you'll find the best solution to your problem.

Don't treat everyone the same

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In every company there are some people who rise above everyone else in their work ethic, their sense of knowing what to do, their attitudes, and their ability to execute.  Even if you have an above average team in your company, there will be a few shining stars who helps raise that average even higher.  These people are critical to the long-term success of your business, and it will be a mistake to treat them the same as everyone else.  There are so many things a business owner cannot control, but one thing he or she can control is the development of the people in the company, and these star employees need to be developed.  Providing them with the right resources will only make them even more valuable to your business.

These are the people you want to invest a significant portion of your time in through coaching and training.  A company I worked for would pay the tuition for any employee to go to college as long as the course even remotely would benefit the company.  They defined that benefit very loosely, and they paid all my tuition while I earned my undergrad degree.  A small business might not be able to do that, but most could offer at least some financial assistance to their star employees.  Owners would want to seek nearby seminars that would help their best employees learn new skills.  Top employees should also be cross trained so they can learn the various jobs that exist in the company.

Top performers should be rewarded differently than other employees.  They should receive higher pay raises and larger bonuses.  Larry Bossidy and Ram Charan, in their book Execution: The Discipline of Getting Things Done, explains that "When the wrong people get rewarded, the whole organization loses.  Problems don't get fixed, nonperformers get ahead, and the good performers start looking for jobs at places where their contributions will be recognized."  You are under no obligation to pay everyone the same or to give all your employees the same bonus.  It's your money.  The only people who will get upset if they are not treated "equally" are the lower-performing team members.

Speaking of lower-performing team members, they need to be treated differently as well.  Every six months Barbara Corcoran of Shark Tank would fire the lowest performing 25% of her real estate sales people.  While that may be extreme, their lack of success does need to addressed quickly by the owner.  It may be that they are were not hired for a position best suited to their gifts, or they could need additional training, but the cause of their poor performance needs to be corrected or they do need to be replaced.  In today's business economy no small business can afford to have a group of people who are not producing.  They are not only a drain on your bottom line; they are also a drain on your top performers.

Treating all your team members the same is not an issue of fairness and only your less productive employees insist on everyone being treated "fairly."  In fact, it is unfair to your top performers to treat them the same as you treat others on your team.  Even worse, it is very de-motivating to do so and will soon cause them to either leave you for another employer or begin to function as the lower performers.  Either way, you lose.  Invest in your top performing employees and your business will reap the rewards for years to come.

Is there a better way to do your job?

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In 1967 I enlisted in the US Navy and a year later was assigned to the aircraft carrier USS Enterprise where I spent the next three years of my life.  I enjoyed many aspects of Navy life and may have made a career of it except I had a wife and daughter waiting for me to come back home and resume a normal life.  I find I am often drawn to books that are somehow connected to the Navy which I why I first picked up It's Your Ship: Management Techniques from the Best Damn Ship in the Navy, 10th Anniversary Edition by Captain D. Michael Abrashoff, then captain of the USS Benfold, a ship he turned from one of the worst in the Navy to one of its top performing ships.

One of the first things he did when he took command of the ship was to ask each crewman, "Is there a better way to do what you do?"  He found that there were many better ways to do things and whenever possible he gave the people the power to make those changes.  It was a huge morale booster that not only led to higher performance but also to a higher retention rate.

Abrashoff understood something many leaders forget.  The people doing the job often know more about that job than anyone else including the so-called experts.  The funny thing is that these leaders knew that when they were working their way up the ladder, but once they sat down in the manager's or owner's chair, they suddenly begin to believe they know more than the persons doing the job.

For thirty years I was employed at a factory working various machine lines, the assembly line, receiving, and quality.  I was amazed how often someone would come to a line where I was working from their air-conditioned office and begin to tell us how we could improve the way we were working.  I once had a time-study expert conduct a full time study on a particular job I was doing on the assembly line while the line was shut down for repair!  I told him it was impossible to do a time study on my job when I couldn't even do the job.  He insisted I walk him through what I did and he would be able to determine how long the job should take.  His report wasn't even close to the actual time it took to do that job.  What an idiot!

This guy reminded me of a product engineer who insisted that a part they had developed would fit perfectly on a certain model of engine we were building.  There was one particular configuration where the mounting holes would not match up properly.  Time and again we complained about the problem, and every time he would demonstrate on his computer how everything matched up fine.  It took weeks before someone forced him to come to the assembly line and actually install the part.  He soon found out the part would not install on that configuration, and the part was re-designed.

When I became owner of a small business I made many mistakes which I explain in my book by that name, but one mistake I avoided was to believe that I knew more about what our employees did than they did.  In one of our earliest meetings I told them that if I got in their way while they were trying to get work done to just kindly ask me to step aside.  These were experienced, hard-working people who knew far more than I ever would about how to do their jobs.  Any changes that would be made would happen only after we discussed them, not just because I thought something different would be better.

How often do you ask your team members if they can think of a better way to do their jobs?  How willing will you be to give them permission to make the changes they identify?  When people have real input into how they function while at work they are usually much more productive and have much better attitudes towards their work.  That can quickly improve the bottom line of any business.

If you haven't read Abrashoff's book I would highly recommend it.  It's really an interesting read.

Providing training for your team members

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In the late 1980s I decided to begin work on a bachelor's degree.  I was forty years old, had a family, worked full-time in a factory, and was the bivocational pastor of a small church in our community.  You would think that would be enough to keep anyone busy, but I felt that I wanted to earn a college degree.  The company I worked for would pay my tuition for any class that would be applicable to my work there, and that included just about every class I took.  My cost was my time, books, and fuel driving back and forth to the classes.  It was a good deal for me and it's one that many businesses offer their employees.  It took seven years of attending classes to earn my degree, and a year after graduating I took early retirement and left that company after 30 years of service.  Some might think the company wasted their money, but I would disagree.

About three years before retiring a new position came open in our plant.  Being a union factory all shop jobs were assigned by seniority whether the person was qualified or not.  This job was different.  It would not be assigned by seniority, and the union would select the person.  The person who got the job would be a contact person for every customer the plant had.   This was the person who received information about quality issues for all the products our plant produced and had the responsibility to find out what went wrong and what corrections were needed to ensure it didn't happen again.  I became the person selected for the position.

It was quite a change for someone who was used to coming to work every day running machines that manufactured cast iron pulleys.  I had an cubicle in the office area and reported directly to the Quality Manager and the Plant Manager.  When I went out on the floor with a problem every supervisor knew that they had to work with me to resolve it.  I received phone calls from customers all over the world.  One day I had a conference call with customers in Scotland and Brazil.  When I began my new job our plant quality wasn't very good; when I left it three years later our defect rate was one of the lowest in our company.

To this day I am convinced that one of the primary reasons I was selected for the job was because I was working on my college degree.  That didn't make me smarter than anyone else, but it did demonstrate I had the capacity to learn and the ability to relate to others.  Having to write papers made it more likely that I could handle the written communication the job demanded.  The reduction in our quality issues on my watch demonstrated the union rep made a good choice in selecting me, and the investment in my college education was one that paid off quite well for the company.

Some companies seem to understand the importance of training their team members while others still view them merely as production units.  I've heard some argue that they were not going to spend much time training them beyond what they needed to do their job because they would just leave anyway.  That may be true, but as Zig Ziglar says, "The only thing worse than training someone and losing them is not training them and keeping them."  Providing regular training opportunities often brings dividends to a company they never expected.  At the time I began my college education the job I would later get didn't even exist in our company.

Most small businesses would struggle paying for college tuition for their employees, but there are numerous training opportunities for people that are fairly inexpensive.  A local community college might offer a course that would be helpful or interesting to some of your team members.  There may be a seminar you could take people to.  Many offer significant discounts for additional team members to attend making them very affordable.  There are many on-line courses that some of your team members may enjoy.  Investing in their training makes them more valuable to your company and will often make them less likely to want to leave your company.  Many return your commitment to their growth with a greater commitment to you.  Making training available to your employees is the smart thing for every business to do.

Show people you care

One of my secret enjoyments is watching Bar Rescue on television.  Since the script seems to run about the same on every show I don't know how much of it is real and how much of it is staged for television, but it is still interesting to watch.  A bar is in financial trouble, the rescuer is called in who find all kinds of unbelievable problems from dead rats in the kitchen to employees who steal.  There is usually a confrontation between the bar owner and the rescuer that ends up with them shouting at each other.  There is another confrontation between the rescuer and the staff.  Experts are brought in to provide training, the bar gets a make-over, and suddenly everyone is smiling and the bar is making tons of money.  One of the things the rescuer says in nearly every episode is that until the owner cares about the business no one else will, and at least that part of the show is absolutely true.

Most small business owners begin their companies with great enthusiasm and pride, but over time the mundane demands of business, the endless details that must be addressed, the times of disappointing sales, employees that don't work out, and the challenges of trying to run a profitable business can suck the enthusiasm out of nearly everyone.  Little things begin to be ignored.  The floor isn't swept one evening which soon becomes a week.  Past due collections are ignored because too many other things are demanding the owner's time.  Phone calls are not returned promptly.  The owner starts coming in later in the morning or leaving in the middle afternoon to play golf without having resolved a potentially major issue.  Team members are watching and soon determine that the owner really doesn't care any more, and if he or she doesn't care why should they?

It's not long before they begin slacking off, violating company policies, and providing less than quality service to your customers.  You can reprimand them all you want, but this problem is really on you, the owner.  You created a climate in your business that convinced your employees you no longer cared about the company.  They were just following your example.

Small business owners must consistently demonstrate to their employees and customers how much they care about their business.  This is done by addressing even the smallest details in a timely fashion.  It's done by arriving early and leaving after everyone else does.  You show how much you care by demanding that every thing that is done in your company is done with excellence, and that excellence begins with you.  You take pride in the way you dress, the way you go about your job, and the way you relate to both your customers and employees.  You exhibit respect to everyone you meet and you treat others as you would want to be treated.  When you consistently do these things your team members will know how much you care about your company, and they will care too.

I'm afraid this is a lesson I learned the hard way.  You can read more about my own failure to show my employees how much I cared about our company in my newest  book Mistakes which is only available on NOOK.

Staffing a start-up

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A common mistake some entrepreneurs make when they start a new company is spending money on things they don't need.  I recently heard a caller to a radio program explain that one of the reasons he was having financial problems was he had bought a new pick-up truck for the carpenter business he was starting.  He had made virtually no money in this new enterprise, and he spent $30,000 for a new pick-up truck.  The radio host told him that was a huge mistake, and the business owner responded that he had to have a truck to do his construction business.  The radio host agreed that he needed a truck, but he didn't need a $30,000 truck he had to finance before he ever got his business off the ground.

New businesses make the same mistake when they purchase or rent office space or equipment.  They overspend on these items before they have any cash coming in thinking they have to have all the latest technologies and a prestigious office.  Actually, unless you are a retail store you may never need to meet a client in your office.  When I think of many of the service people with whom I do business I realize I've never been in their office or even know where that office is located.  You can work out of your garage or your basement when you start out.  For only a few dollars a month you can get a post office box for your business mail and add a second business line that comes into your home which will transfer your calls to your cell phone.  Most people will assume you are working in your office when they call. 

Another unnecessary expense some start-ups encounter involves their staff.  It is doubtful that most new start-ups need to hire a full-time person when the business first begins.  Many entrepreneurs do not realize all the expenses such a hire creates.  This person will need supplies, equipment, and training.  There will be additional taxes due with such a person now on the payroll that will eat into those early sales.  There are better options that hiring a full-time person right off the bat.

1. Get a virtual assistant.  There are now numerous companies providing virtual assistants who will handle the administrative tasks you need to avoid so you can be more productive with your time.  These will cost your new business much less than hiring someone, and if they don't work out you simply end your agreement.  You don't have to worry about unemployment compensation or any of the other issues that goes along with terminating an employee.  There is one thing to make sure of before you get a virtual assistant.  Have a detailed list of what you need this person to do and ensure that is clearly communicated before signing any type of agreement.
2. Get a part-time person.  Maybe you have enough administrative work for someone to do for 10-20 hours a week and you're not comfortable with a virtual assistant.  A part-time person might be the best option for you.  I know a person who did some work for a local professional in her home during the evenings on a part time basis.  The work was such that it could be done at her convenience which made it appealing to her.  
3. Hire a temp.  The benefit of having a temporary employee is you only have to worry about paying a salary to the temp's agency.  They handle all the taxes for the person.  You write out one check each week for the person's services, and you don't have to worry about it after that.  A second benefit is that you can hire the person for a particular project, and when that is completed his or her employment with you is completed as well.
4. Use interns.  If you are located near a college or university there may be some students willing to do intern work for the experience and so they can add it to their resumes.   Interns usually need a lot of supervision but they also bring a lot of energy to the position.  In some cases, you may find a great future team member at little or no financial cost to you.

Starting a new business requires a lot of time, and it may be appealing to hire someone to help.  I agree that it does take a lot of time, but chances are you still have more time than money.  You can't afford to pay someone to answer the phone for you.  Answer your own phone.  Order your own supplies.  Open and close your business yourself.  If your idea for a business is a good one the day will soon come when you will need to add team members.  At that point begin to add part time people or follow the suggestions listed above.  If that is successful it won't be long before you will be adding people, but at that point you should be able financially to do add people who will contribute even more to your business' bottom line.

Control what you can

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Small business owners soon learn that there are many things they cannot control.  They cannot control the nation's economy; they can't control the price of fuel; they can't control the changing buying habits of their customers; they can't control decisions their vendors make.  We could easily make a list of things we can't control that would fill sheets of paper, but there is one thing we can control, and yet many small business owners ignore that thing.  They can control the quality of their people, especially those who are in positions of leadership.  Larry Bossidy and Ram Charan, in their excellent book Execution: The Discipline of Getting Things Done, insists this is so important it is the one thing that small business owners should not delegate to anyone else in the company.

In a post last week I discussed the importance of having the right team members in your company, but just as important is making sure they are in the right places, especially if they are leaders in your organization.  For various reasons, small business owners often struggle with people placement.  We fail to recognize changes that may be taking place and how some of our current leaders struggle to adjust to those changes.  Soon the area of their responsibility begins to struggle as well.  Even if we recognize that this is the direct result of a leadership failure in that department we often fail to respond quickly to that failure.  More often than not this is a lack of courage on the part of the owner or a sense of misguided loyalty.  In my book Mistakes I stated that we can become too loyal to our employees, and that can cause us major problems. The question we must keep asking ourselves of our leaders is are they still able to get the job done?  If the answer is no, we have to find out if there is something we can do to help them improve.  They may need additional training.  They may need additional personal to assist them.  For the sake of the company, they may need to be moved to a different position in the company.  As a last result, they may have to leave the company for a position better suited to their skills.  What you cannot do is allow them to continue to create problems for your business.

Annual reviews do not happen quick enough to highlight these types of issues.  As a small business owner you need regular times with your leadership to determine if there are problems that have not reached you yet.  Even in the smallest of companies there are often things going on behind the scenes that the owner hasn't been informed about, and these kinds of secrets have the ability to cause you real problems.  A small business owner must meet with his or her top leaders at least weekly to make sure everyone is informed of what is going on in the company.  These leaders should be instructed to inform the owner if they foresee potential problems for the company as well as any current issues.  Along with the problems they highlight, they should know that they are also expected to present at least 2-3 ways to respond to those problems.  No leader in an organization should be allowed to present a problem without having thought through it well enough that he or she has identified some possible ways to respond to it.  People who make a habit of doing that are obviously not the ones you want in leadership positions.

Bossidy and Charan offer some excellent advice around the issue how to best use the people in your organization in the book mentioned above.

You need a great team

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I believe it was John Maxwell I first heard say that if your dream is too small for a team your dream is too small.  Many small businesses began as a one-person show, but eventually the owner of a one-person business will learn that he or she is still an employee...and the boss.  Soon after that recognition comes another awakening - unless you can expand the business to include more people it will never be what you first envisioned it would be.  It will never provide you and your family with the life you wanted when you became a business owner.  It is the failure to develop a team that causes many small business owners to eventually give up and return to the workforce.  It makes no sense to deal with all the headaches that go with owning your own business if you are the only employee and are not making any more money, or often even less, than you were when you were working for someone else.

But, just adding people isn't enough.  You have to be adding the right people.  Dave Anderson, in his excellent book Up Your Business!: 7 Steps to Fix, Build, or Stretch Your Organization, writes, "You can read books on strategy and attend courses on corporate vision but the fact is that without getting the right people on your team, nothing else you do will matter.  Your vision is worthless, strategy impotent, and values corrupt without the right people to execute them."  Later in the book he adds, "A great dream with the wrong team is a nightmare because bold goals pursued by mediocre people still result in mediocre results."  He spends the remainder of his book addressing good hiring procedures, the importance of ongoing training, setting high expectations for the team, and how to survive success by overcoming common temptations that successful companies face.

Adding team members is expensive.  If the owner does it right it takes an enormous amount of time.  The best people do not work for entry level salaries and benefits.  There is the cost of training new people in your culture and in whatever business you may be in.  It is very expensive to hire new people, but the cost escalates much higher when you hire the wrong people.  You have all the expenses the good people have plus you have the additional costs of lost business, a damaged reputation, and your own elevated stress levels while you try to contain the damage they cause.  Unless you begin to feel that you are taking too long to hire a new team member you probably have not taken enough time to do it right.

If you want your business to continue to grow you must be constantly developing team leaders.  You cannot wait until you need a new leader to begin searching for one.  The best companies always have people in the leadership pipeline at various stages of leadership development so when the need arises they can go to that pipeline and immediately bring someone in that is prepared to provide the leadership needed.  Without that pipeline a small business owner will often find that he or she is being held hostage by incompetent, mediocre people that the owner doesn't want to keep but can't afford to lose either.

One of the mistakes I made as a small business owner was not hiring quality people when I had the opportunity.  It seemed like those people always presented themselves during our slow times, and by the time we needed them they had already found positions with other companies.  If I had it to do over again I would hire them and create a position if I needed to so that I could keep them.  I really believe they would have easily paid for themselves and would have put us in a much stronger position for long-term growth.

If you want to read a very helpful book on the importance of having a quality team working for you I encourage you to read Anderson's book.  It is one of the best on the topic I've read.