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.
There are tons of resources available online to help you do this; you can follow our simple guides on a mission here and vision here.
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
It's official, management is on the way out, and coaching is well and clearly on top. As we discussed at the beginning of this article, 'managing' people was a requirement 50+ years ago when people didn't want to be at work but had no choice.
If we are consistently managing people, unless they lack the self-confidence to look elsewhere, it is only a matter of time until they leave. Why?
Because as the hierarchy of needs pyramid shows us, a person wants to progress to feeling like they are a high performer connected to meaning and purpose. Nobody can realise this when they are not trusted and micromanaged.
Have you ever worked somewhere where you felt the management didn't trust or like you? It makes you feel worthless.
So why do small business owners commonly struggle to empower their teams and manage too much?
Through my direct personal experience (being this person and being in cultures where this is the attitude), I believe it comes down to the combination of two factors:
A lack of confidence in the owner. They feel that everything has to be perfect, and if it's not, it will all fall apart.
The thought that plagues business owners "It's easier to just do it myself, and I can do it better."
So pro tip number one, if you read those two statements and felt a little uncomfortable at how accurate they are to you, work on letting that crap go. You can read my post on perfectionism here. You have to shift your mindset. The truth is you might be able to do it better yourself, but there's only one of you. Your ultimate job as a business owner is to scale you. You do that by letting go of perfectionism and coaching others.
What can you start doing right away for free?
Book quarterly coaching sessions between you and your team. We provide an accessible format and process for this available here. Begin shifting away from fixing problems yourself and providing your team with to do's. Start asking your team how you can do things better, give them targets and coach them to achieve them. Stop providing them with instructions and start asking them open-ended questions. They'll thank you for it, so will your business, and so will the future you.
If you want to study coaching and business deeper, check out Coaching for Performance by Sir John Whitmore.
Again there are free coaching resources available in the tools component of our site here.
4 - Talk about wellbeing
Our lifestyles have changed dramatically over the last 20 years and look set to continue to do so. Our quality of life and safety is constantly improving, yet our physical health, mental health, and overall happiness are on the decline.
We live in a time where we have the opportunity and tools to be healthier than ever before in human history. The challenge is that environmental factors, such as our work becoming increasingly sedentary, are making it easier and more common to be unhealthy.
As a business owner, you are a natural leader. Therefore the onus is on you to prioritise and talk about wellbeing. The truth of the matter is you don't have a tremendous amount of choice in this area.
Running a business is stressful and demanding. If you don't look after your health, you'll burn out and get sick like many other business owners. Not only will you get sick, but you'll create a culture of neglecting health.
When you create a culture that neglects health, not only will you struggle, but so will your team. Technology has led to the need for businesses to be more agile. A business simply can't be agile if the team are drained and sick.
In the best-selling book, 'the one thing,' real estate entrepreneur and author Gary Keller explain how his businesses transformed dramatically (for the better) once he began to prioritise his work-life balance and health.
Health falls under the 'shelter and safety' part of MHoN. You can see that if you let health slip, it's impossible to function as a high performer, and the same goes for your team.
Most businesses (big and small) view wellbeing as a struggle. But it can easily be an asset. By simply being a business owner that looks after their health and making time to talk about it at work, you'll make health a positive in your business.
There are lots of different wellbeing models that can be studied, but at Better Happy, we have found that it's very effective to, at a minimum, create discussions around:
Exercise
Nutrition
Sleep
Mental health and stress
By simply planning an hour or morning once a month to talk about one of these topics over the year, you'll address all of them three times.
You don't need to be an expert on these areas; just creating an open forum to discuss the subject can be immensely powerful. We find at Better Happy it works well to follow up a health talk with a 30-day habit-building challenge that the whole team can get involved in.
Again this doesn't need to be difficult or even expensive. There are free resources available at our free tools page, and there's also an infinite supply of materials available online.
5 - Reduce owner dependency
Finally and possibly the most appealing to the overworked business owner is reducing owner dependency within the business. Your team will perform at their highest when they feel empowered, trusted and connected to the bigger picture.
Sir John Whitmore, the author of Coaching for Performance and renowned coach, states:
"A leaders task is simple: to get the job done and to develop employees'
The problem is most business owners get stuck in the getting the job done component. Too much getting the job done and not enough developing employees is bad for the team, the owner, and the business.
There's no better way to empower your team than to entrust them to do more in the business without your presence.
The challenge is business owners are so used to being present, being involved in everything and keeping everything ticking over that they can't imagine it being any other way, even though this is happening to the detriment of all parties.
By increasingly entrusting the team and incrementally removing yourself from tasks, you enable both the team and yourself to progress through MHoN. I'm willing to bet if I asked you what your ultimate vision is, it isn't being stuck in your business every day fire fighting. Empowering a team is the only way for you and them to progress.
So the argument is clear, you need to reduce the dependency of the team and business and you.
Now you know this is right, but the chances are you still won't do it after reading this. Why?
Because it's uncomfortable, because you know you're going to have to do things in a different way to achieve it and because at the moment you don't have to. You've gotten comfortable being uncomfortable.
So here's what you need to do to make this happen.
You need to plan and book your holiday for the year. This should be at least six weeks across an entire year.
Do it now, and don't give yourself the option to cancel it.
After that, you need to plan to reduce your working week by one day within four months. How can the show run with your presence being reduced by a day?
Do these two things as soon as possible and tell your team. Tell them you're doing it because you trust them and want to empower them. You want to stop being so involved in everything. This will help you and your team progress and remain high on MHoN.
There's quite a lot to take in across this blog, but the key takeaway is this:
You have everything you need in your business already to nurture an incredible team that will grow your business for you whilst freeing you up.
You've got a business that's already working. You've attracted a group of people that want to help it be all it can be.
The only thing that's getting in the way at the moment is your mindset.
Money isn't the key factor.
The irony is that the less you worry about the wages and the more you focus on empowering your team and enjoying the business, the more the money will come.
Everything we've covered in this post you can implement for free and reap the rewards of higher productivity, reduced turnover and a better life for you.
The tricky thing is having the discipline and finding the time to implement this when you are already swamped.
That's why we created the Better Happy system and service, to help small business owners and their teams shift from struggling to thriving. We genuinely believe that you, your team and your business can make an even more positive impact in the world and enjoy the process a lot more than you are already.
So if you're the type of person that can read this and start making all the changes, go for it and get to action now. Head over to our toolkit to find tons of resources and take our free better happy owner scorecard to see how you're stacking up.
If you're the type of person that knows this needs to be done but don't feel sure where to start or how, take the Better Happy scorecard, book a chat with one of our coaches, and we'll help you get clarity.
Keep up the great work, keep chasing your dreams and keep making a difference.
About Mike: Mike believes that a structured pathway to health and happiness is the solution to individual, business and global challenges. Mike was never made to feel good in the schooling system, experienced poor management in military and burn out in his first business. Seeing these problems were widespread Mike Co-Founded Better Happy to help other business owners and employees achieve their visions faster with health and happiness.