Well-Balanced Management Teams for the SMEs

The trouble with expounding on this subject is that it’s a bit like those TV chefs, all of whom have the perfect recipe for roast beef, all of which are slightly different and all more or less work.  The truth is that there is no absolute recipe for the perfectly balanced management team but, with over 20 years experience advising in the boardrooms of businesses in the SME sector, I guess I’m qualified to air my views.  Let’s start with a few ground rules…

Rule 1…Blood relatives of the owner/majority shareholder/founder have no God-given right to a seat on the board.  Axiomatically, bringing in “outsiders” with relevant qualifications and experience is a very good idea.

Rule 2…People get paid for the job they do not the shareholding they own.

Rule 3…If the business is now under control of the second generation, consider appointing a non-executive director and, if it’s under control of the third or subsequent generations, absolutely appoint a non-executive director, maybe even two.

In every boardroom, I would expect to see the following roles covered by four executive directors:  Managing Director, Operations/Production, Finance/Secretariat and, lastly but by no means least, Sales.

The wise will already also have a Chairman, possibly a non-executive one who can advise on corporate governance, manage the egos around the table, massage the growth pains and keep the bank sweet.  A growing number of companies are appointing a second non-executive director from within their industry sector as a rainmaker.

Having dealt with boardroom roles, it is vital to consider personalities.  Were a board to comprise six clones of Yours Truly, I am bound to observe that morale within the organisation would be at an all-time high, the parties would be superb but the business might well crash and burn owing not, I might say, owing to any lack of skill or ability but simply because we would all be seeing the same thing in the same way.  Some readers will be familiar with the optical illusion of the face of a lady where one version is a young lass and the other is an old hag. Both are correct.  The conclusion is…

…Pick people who share your aims but whose personalities and skill sets differ from yours.  In its simplest form, surround yourself with a mixture of ‘big picture people’ and ‘detail hounds’, factual decision makers and emotional decision makers.  Each will see danger signals or indeed benefits that the others (including you) simply won’t and vice versa.  That achieved, board members must all agree to lower their glass screens; in other words, accept objective analysis from those who see things differently.  To MDs I say, do please allow your subordinates to prove to you how good they are; they will appreciate the latitude and be much more motivated to succeed than if you insist on micro-managing everything to show them what a genius you are (not!)

OK, so your board now comprises the rainbow alliance.  As command and control descends through the business, it is important that the same recipe for mixing and matching is applied at all levels.

Life certainly won’t be boring and the MD will have his work cut out knitting the personalities together into cohesive teams but, working together objectively, the business will emerge stronger as a result, of that I have no doubt whatsoever.

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