Soapbox: People are the path to profit at all times

SMEs are facing a tough and uncertain future. To survive, they need to maximise every resource they have to hand.

It's an obvious point, and we've heard it many times before, yet we still fail to grasp just how much people matter. Finding, retaining and motivating the right people can seem like an impossibly onerous task for owner-managers, who tend to lack time and resources. Yet those who get it wrong do so at their peril.

As an entrepreneur and non-executive chairman, I have first-hand experience indicating that at the root of most problems I have experienced is people. There are frequent occasions where senior management don't communicate or relate to the people who work for them and where staff aren't given sufficient leadership and incentive to care about what they do, or how they are contributing, to make a profit.

For SMEs, there are five key people-related factors that are vital to get right. First and second are finding and keeping key people; third is ensuring they have a voice and know how to question; fourth is making sure they are encouraged to say “no” and mean it; while the fifth is encouraging them to be action-focused, so that they get on and do it now.

By far the easiest, fastest, and least expensive way to find the right people is through personal networks. These are people you have come across, whom you know, or who are known by others whom you know; people who come recommended by contacts and acquaintances you trust; people who know you and who understand what you are trying to create; friends from the past, school, university, earlier work environments.

True, if your company expands you may need more structured resourcing policies and you may need to reach outside for professional support, but social networking can run far and deep. Become a user of Twitter, Linked In or Facebook; turn up at seminars and talks; cultivate relationships that put you in the path of others in your industry; get to know your rivals. Who knows? Tomorrow they might be your employee, or if they decide to buy out the competition, your boss!

The days of slavery are over. Retention is not about tying people in, but about creating the environment in which they wish to remain. The environment itself involves the job, the colleagues, the compensation, the future growth potential, the challenges and the leader’s vision.

It's also about creating buy-in: why not follow in the footsteps of companies like Google, where imaginative staff are given the space to develop ideas? Say thank you when your sales team hits the target - don't hike the targets straight up again when they do, let them enjoy success and deliberately celebrate success frequently. Make your people proud to be part of your business. Motivated staff feel that they are part of the business and for them it is not just a ‘9-5’ job. They need to feel they are in an environment where they are encouraged to ask “why?” and to say "no".

Leadership is about creating a clear vision for the future, with the road map, and the right team. Without asking “why”, getting clarity of vision can be difficult; choosing the right route may be complicated and getting the right crew on board may be impossible.

Similarly, allowing staff to disagree is key to their own personal sense of worth within the business and in a positive sense being able to say “no” is a valuable management skill. Knowing when one has to pull the plug on projects that have gone bad, when haemorrhaging cash flow cannot be sustained any longer, when a business plan is unacceptable, when to say “no” to new business that has no relevance to your long-term strategy or chance of being profitable, and mean it, is critical. Being able to say “no”, “you do not have a future with this company”, is tough but at the same time important.

Entrepreneurship is about taking the initiative. Time is totally perishable. It can never ever be renewed. Train people to think and do. Procrastination wastes huge amounts of time. Reward action-orientated behaviour and lead by example. Encourage people to be proactive, not reactive. Get your most proactive people to mentor those who struggle or who aren't quite up to speed. These are the people who are to be rewarded, promoted, and given the opportunity to lead.

Carpe Diem! People are your biggest and most valuable asset. Seize the day, do it, do it now!

John A. Dembitz is author of the recent book It’s the People (LID Publishing).

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Ashdown Group: IT Manager / Development Manager - NW London - £58k + 15% bonus

£50000 - £667000 per annum + excellent benefits : Ashdown Group: IT Manager / ...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£13000 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Ashdown Group: Training Programme Manager - City, London

£40000 - £45000 per annum + benefits : Ashdown Group: Training Programme Manag...

Day In a Page

NHS struggling to monitor the safety and efficacy of its services outsourced to private providers

Who's monitoring the outsourced NHS services?

A report finds that private firms are not being properly assessed for their quality of care
Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

Zac Goldsmith: 'I'll trigger a by-election over Heathrow'

The Tory MP said he did not want to stand again unless his party's manifesto ruled out a third runway. But he's doing so. Watch this space
How do Greek voters feel about Syriza's backtracking on its anti-austerity pledge?

How do Greeks feel about Syriza?

Five voters from different backgrounds tell us what they expect from Syriza's charismatic leader Alexis Tsipras
From Iraq to Libya and Syria: The wars that come back to haunt us

The wars that come back to haunt us

David Cameron should not escape blame for his role in conflicts that are still raging, argues Patrick Cockburn
Sam Baker and Lauren Laverne: Too busy to surf? Head to The Pool

Too busy to surf? Head to The Pool

A new website is trying to declutter the internet to help busy women. Holly Williams meets the founders
Heston Blumenthal to cook up a spice odyssey for British astronaut manning the International Space Station

UK's Major Tum to blast off on a spice odyssey

Nothing but the best for British astronaut as chef Heston Blumenthal cooks up his rations
John Harrison's 'longitude' clock sets new record - 300 years on

‘Longitude’ clock sets new record - 300 years on

Greenwich horologists celebrate as it keeps to within a second of real time over a 100-day test
Fears in the US of being outgunned in the vital propaganda wars by Russia, China - and even Isis - have prompted a rethink on overseas broadcasters

Let the propaganda wars begin - again

'Accurate, objective, comprehensive': that was Voice of America's creed, but now its masters want it to promote US policy, reports Rupert Cornwell
Why Japan's incredible long-distance runners will never win the London Marathon

Japan's incredible long-distance runners

Every year, Japanese long-distance runners post some of the world's fastest times – yet, come next weekend, not a single elite competitor from the country will be at the London Marathon
Why does Tom Drury remain the greatest writer you've never heard of?

Tom Drury: The quiet American

His debut was considered one of the finest novels of the past 50 years, and he is every bit the equal of his contemporaries, Jonathan Franzen, Dave Eggers and David Foster Wallace
You should judge a person by how they peel a potato

You should judge a person by how they peel a potato

Dave Hax's domestic tips are reminiscent of George Orwell's tea routine. The world might need revolution, but we like to sweat the small stuff, says DJ Taylor
Beige is back: The drab car colours of the 1970s are proving popular again

Beige to the future

Flares and flounce are back on catwalks but a revival in ’70s car paintjobs was a stack-heeled step too far – until now
Bill Granger recipes: Our chef's dishes highlight the delicate essence of fresh cheeses

Bill Granger cooks with fresh cheeses

More delicate on the palate, milder, fresh cheeses can also be kinder to the waistline
Aston Villa vs Liverpool: 'This FA Cup run has been wonderful,' says veteran Shay Given

Shay Given: 'This FA Cup run has been wonderful'

The Villa keeper has been overlooked for a long time and has unhappy memories of the national stadium – but he is savouring his chance to play at Wembley
Timeless drama of Championship race in league of its own - Michael Calvin

Michael Calvin's Last Word

Timeless drama of Championship race in league of its own