Common Management Myths

Today, we’re taking inspiration from Doug Tatum’s “No Man’s Land” which is a great resource to turn to if –and when – your business enters the tumultuous time as it expands from existing as a small business, and becomes a medium to large-sized enterprise. More specifically, we’re addressing five of the most common myths surrounding management’s role, and the hiring process in your business.

Up first is the ever-popular myth that you need to determine where you’re weak, and hire in those areas specifically. Doug Tatum offers up an explanation, explain that “Instead of urging entrepreneurs to determine where they’re weak, I advise them to figure out their own strengths, and protect them when delegating authority.” Unpacking what Mr Tatum is referring to here, rather than focussing on determining where your weak points are – which is no doubt a vital part of your self-evaluation cycle – identify your strong points, your unique selling points and your points of difference over your competitors, and work on doubling-down on their effectiveness. The author is not dispelling the notion that you need to address areas of improvement, however. Rather, he’s advising you that time taken out in this evaluation process will more than likely prove a more fruitful return on investment if you strengthen your strengths and make sure the promises you make to clients are not broken. Doug Tatum sums it up with the following quote: “I’ll say it again: Entrepreneurs need to protect the single most important part of the business, the part where instinctive judgments still come into play. This need to delegate those parts where experience, knowledge, and accurate analytical judgment reign supreme.”

We’ll add a caveat – pinch of salt – to this piece of advice by reminding you that addressing things that are performing sub-par in your business, you do indeed need to address them, although we agree that your strengths can always be strengthened, so you’ve got more leverage out in the market over your competitors.

The next myth on the chopping block is the belief that to grow your business to the ‘next level’, you need to replace yourself (or the respective entrepreneur) with a new CEO. Doug Tatum mentions Apple’s Steve Jobs – and the problematic CEO he was replaced with – as well as FedEx’s Fred Smith, SAIC’s J.Robert Beyster, Microsoft, Google, Home Depot as classic examples to dispel this myth. Each of those founders and/or CEOs was around from the beginning, and although they may be extremely successful and respected CEOs now, looking retrospectively, they were often seen as amateurs to the business world that needed to be ousted in order for the company to progress to that ‘next level’ of success. Tatum says this is largely due to the fact “Entrepreneurs have exactly the temperament and skills required to bring a company to a billion – and beyond.” Bringing in a new CEO can no doubt be the savior of a stagnant business, but it’s also worth considering just how important the entrepreneurial spirit the founder brings to the business is, and what it can do to motivate your staff members, and stakeholders. If you need an example of just how disastrous a new CEO can be to a company’s culture, existing staff and indeed stock price, look no further than John Sculley’s decision to fire Steve Jobs from the business he co-founded. Part of what this all boils down to is that the founder in question may have been the best motivator of staff, or perpetrator of staff culture throughout the business, and in their absence the business may lose some of its mojo.

Let’s move on to the pervasive myth that a growing company should hire middle-management as a prelude to bringing senior management into the mix. “No Man’s Land” author Doug Tatum is a vehement dispeller of this myth, saying that the idea is “harmful” to a fast-growth company, due to the fact that only a high-level hire “will have the ability to make the experience-based decisions the firm needs.” In addition, high level management will be better suited to identify and propose a solution to a problem ahead of the problem becoming fatal. The argument is put forward that middle-level management often increases the size of a burden for the CEO, as they frequently turn back to them for guidance and direction. High-level management in essence owns a chunk of the business, and due to the higher stakes, their more comprehensive professional history and their ability to take initiative, you’ll be far less likely to be a burden in the problem-solving process than putting energy toward consolidating your middle-management line up. “You’re looking to delegate authority, not extend your own authority over yet another employee who is hamstrung and in over [their] head.” Tatum writes. In spite of their increased salaries, it will ultimately prove costlier to the business not to invest in the upper-echelon of your management team when you start to consider lost time and resources when promoting the middle-level management team rather than the top-down approach.

The final myth we’ll address is Doug Taum’s point that professional middle-management ensures profitability and growth by cleaning up the company, and ridding it of chaos. Tatum argues that “this myth is especially dangerous. The real key to growing and making money is to ‘mess the business up’ and ‘clean it up’ in a consistently balanced manner.” What on earth is he talking about here? Well, the argument here is that figures like the CEO or the entrepreneur are there to frequently ‘mess up’ the business by making new promises to customers, experimenting with products, servicing new requests for customers needs, etc, while simultaneously cleaning up their services. This is achieved through different people in the business, with different skills. The mess-it-up side of the equation can be your more creative types, those who take in customer feedback and design a new product or service that responds to their needs. The clean-it-up side is responsible for ensuring that the existing level of service you provide is not detrimentally impacted by your experimentation. They’ll be able to tell when you’re overextending, or making promises that you’ll struggle to deliver on; think of it as a throttle and a brake pedal, pushing forward into new things, but hitting the brakes when you’ve found yourself in new territory that you can’t operate in.

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