Establishing and growing a small business is challenging.
It's a challenge unlike no other, a challenge only those who have undertaken can truly comprehend.
There are some typical milestones to be met in the small business journey, one of which is establishing a team.
In theory, reaching the point of business where we can add and grow a team should be the most rewarding and enjoyable.
We've created jobs, we've got more human capacity so we can do more business and start to work less, win/win.
But as any of us who have reached this stage realise, it's not quite that easy.
As if running a business wasn't already stressful enough, we now have a team to worry about.
We have to make sure that the team knows how to do their jobs, that they're motivated to do their jobs well and do as much as possible to make them want to stick around even when our competitors are trying to pinch them.
If and when we do lose a key player (that's right, everyone does, so don't beat yourself up if you have), it hurts, and incomes the thought:
"This was easier when it was just me! I might just downsize again and keep it simple."
But don't add too much fuel to that fiery thought.
You've worked hard to get here. Developing a great team is rewarding (and not as difficult as you might think). It's what enables your business to scale and what gives you the business/life balance you deserve, so stick with it and grizz through the growing pains.
You have to view this as one of the final hurdles placed before you to achieve your vision.
A combination of factors enables a highly engaged business team, all of which we cover in the Better Happy 5s System.
The point of this blog isn't to work through those factors.
The point of this blog is to help you get past a mental block many small business owners get stuck on.
That mental block is obsessing over what you currently pay your staff and how you might lose them if your competitors offer more.
I'm not going to lie to you and imply that we live in a fairy tale world where nobody cares about money, and it's all about the purpose.
What you pay your people is important.
But it isn't the key factor for engaging and holding onto a team.
There's a lot of businesses paying a lot of disengaged employees a lot of money.
There's also a lot of people leaving their jobs for other jobs that appeal to them more than pay less.
A recent LinkedIn survey showed that 9/10 millennials would consider taking a pay cut to work for a company who's mission and values aligned with their own.
Small business owners need to grasp this because, more often than not, small businesses aren't cash-rich; therefore, regular wage increases aren't always an option. Obsessing over something that's not within your control can drain you and lead to you feeling powerless.
So here's the good news.
Most of what you need to create is not just a good team, but a world-class team is already available to you within your business, and it won't cost you a penny.
To grasp this, you need to have a little understanding of people and their psychology. For this, we'll quickly review Maslow's Hierarchy of Needs (MHoN)
Maslow widely accepted theory is that humans naturally work through the hierarchy of needs. When one is being fulfilled, they move on to the next, so on and so forth.
High performers are people that have reached and surpassed self-esteem or self-belief, that is getting praise from others and feeling confident in their own abilities.
Up until more recent years, people needed jobs to survive, and job choices were limited.
Therefore people were doing jobs to fulfil the physiological and safety needs towards the bottom of the pyramid.
At these stages, people perform lower and are looking to fulfil the next level.
So before the technological revolution, due to the need for work and lack of choice in work, employee turnover was low but so was employee engagement/performance.
People had to do their jobs and didn't have the choices to look elsewhere.
Fast forward to more recent years, and two significant things have changed.
Firstly, in the UK, we don't have to work to survive. We have a welfare system that provides support and even housing to those who cannot or do not work.
Despite this, only 4.7% of working-age people are unemployed because, as Maslow's hierarchy of needs and human society as a whole displays, humans desire more than just survival.
Secondly, we have a choice. There are millions of businesses and therefore jobs, including yours, across tons of industries that people can choose from.
So what does this mean to you as a business owner?
It means people aren't just coming to you to survive.
They're not just coming for a paycheck, and if that's all they feel they are getting, they aren't going to stick around for long.
They're coming to you, probably not even consciously, to progress through Maslow's hierarchy of needs. Paying them addresses the lower parts of the hierarchy, but any business can pay. If this is all you're relying on for productivity and retention, you're missing a trick.
This is a significant mindset shift for a business owner.
You can't be in the mindset that pay is the key factor that affects performance levels.
You can't be in the mindset that you're simply paying people, and in return for that, they need to do a good job.
Employees are coming to you, yes, to get paid, but also to be a part of something, to develop themselves and find meaning. For many, the latter points will be more important than the first.
Suppose you can learn how to guide them through the higher parts of the hierarchy or put the structure in place to do so. In that case, you'll create exceptionally high levels of performance and loyalty. You'll improve peoples lives, become a leader in your industry and attract the best talent.
5 Free Things You Can Do To Improve Engagement And Retention In Your Small Business
So how do we actually do this?
How do we help guide our teams through this pyramid?
Everything shown below is already within your business and can be implemented without spending a penny. It's also directly linked to Maslow's hierarchy of needs, high performance and high retention.
1 - Connect Your People to Your Vision and Mission
Many small business owners think vision and mission is high-level corporate talk, but they couldn't be any further from the truth.
A small business needs a communicated vision and mission more so now than ever before.
Your small business has a vision and a mission, but if you're like most others, the problem is it's all in your head. Earlier I shared a LinkedIn statistic earlier that showed 9/10 millennials would consider a pay-cut to go to company who's mission and vision was aligned with theirs. Imagine how this statistic is impacting your business if you don't have a vision and mission.
Don't be modest, don't underestimate the impact the vision and mission you have in your head will have on recruitment, engagement and retention once you get it out of your head and start shouting about it.
As MHoN shows us, the highest performers are those at the top of the pyramid seeking meaning and value. Historically people found this through religion and social groups, but now more than ever, people are searching for it through their work.
You have to tell your clients and your customers why you exist, what the change is you hope to make in the world and how you go about that differently from anyone else.
Communicating your vision and mission doesn't have to cost you anything. You've already got it.
2 - Basic Systems and Structure
Most small businesses are lacking in systems and structure, and that's ok. Nobody hands us the how-to business book when we begin, and to be honest if we had been too systemised when we opened, we probably wouldn't have gotten anywhere.
We attract and build a team way before solid systems and processes are put into place. It's not unusual for small businesses to attract talent from larger companies even though there is a lack of structure. Why?
Because as we can see on MHoN, humans crave belonging, and in a small close business, the sense of belonging is powerful. Nine times out of ten, when we work with or talk to a small business owner and their teams, the highlights of the business is the 'family feel' or 'the sense of community.
Next comes the but. Almost without failure, the strong sense of belonging is accompanied by high stress levels and people not feeling confident in their roles or personal development.
After someone feels a sense of belonging, they begin to search out esteem from others and self-esteem. In simpler terms, they long to know they are good at what they do and can achieve success without being managed.
Without some solid systems and structure in place, this is almost impossible to address in a small business (and something that many large businesses struggle with). This is why it's essential a small business owner begins to shift away from the 'be busy do' mindset that's got them to where they are and towards a 'work smart and build' mindset that's going to get them to where they want to be.
So what are some fundamental systems we can put in place for little to no cost that will help our people become more confident and independent?
Here are two easy wins.
Job Descriptions and Core Processes
Create clear job descriptions and KPIs for each job. Get your existing team members to document their core processes using free tools such as Trello and Loom. If you think this is something you would struggle with, get your team involved and make it a team-building activity.
Challenge your team to document the 20% of their core processes that produce 80% of their results.
Challenge them to have a Trello board set up with loom videos so that someone new could do the job to a half-decent standard without their presence.
Having this in place makes sense puts method to the madness. It begins the process of systems and scale. It makes it easier to hire and cover people when they are sick on holiday or leave.
Objective Key Results (OKRs)
Implement OKRs across your business. You can learn more about objectives and key results online or by reading John Doers measure what matters.
OKRs enable you to invite your entire team into the strategic planning process whilst providing a framework that makes goal setting realistic and achievable.
The outcome of implementing this process is each of your team members feeling more connected to the bigger picture, more independent, more engaged and more confident. It also takes the load off you, the owner, trying to come up with solutions to challenges year-round and makes your business more agile.
You don't need fancy software or a consultant to get this powerful process started. Start by allotting a 1-2 hour period once every quarter to get everyone together. Share your ultimate objective (your vision and mission), share three big things you would like to achieve within the business this year and ask every team member to develop 1-3 personal OKRs they could implement to help grow the business.
I guarantee you'll be pleasantly surprised at the outcome of these meetings.
You can find a more detailed framework for this in the free download section of our site.
Other basic systems are
Surveying your staff quarterly on engagement and wellbeing
Systemising your onboarding and offboarding processes
Creating a company scorecard to track your numbers weekly
3- Coach more manage less