How can an owner save a business when the director changes?

ayshakhatunasha

In this article, we will tell you what a company owner needs to do to save his business when the director changes.

Any business sooner or later faces the need to change the operational manager. A new manager should be selected taking into account the conditions in which he will have to work. When the owner transfers operational management of the company to a hired manager, there is a threat of weakening or even loss of power. To avoid this, it is necessary to clearly delineate the functions and areas of responsibility of each of them.


How can an owner save a business when the director changes? Photo 1
Common mistake:

the owner transfers all his responsibilities to the new manager and completely removes himself from business in the hope that now the business will develop on its own, without requiring any attention from the founder.

Result:

If the new director is successful, there will be a loss of control over the company.

If the new manager turns out to be incompetent, the company will be lost.

Golden mean:

This is an understanding of what exactly needs to be delegated and what needs to be kept for oneself.



The functions of the owner-ideologist include:

1. Formation of the company’s mission (ideological values ​​and business plans).

2. Approval of all fundamental company policies (regulations, principles, codes, fundamental instructions, etc. ).

3. Formation of strategic plans and control of their implementation.

The first point includes not only the formulation, but also the constant promotion of these values ​​among the company's employees. The further the business owner is from ordinary employees, the higher the quality of such communication should be. Employees should learn about the company's mission and ideology directly from the owner; this function should never be delegated to managers.

The formation of ideology itself is in some contradiction with operational management. Fulfilling the function of an ideologist, the owner inspires employees, fills their activities with meaning. virtual phone number service And the director of the company must demand, control and achieve.

The second point is necessary so that any regulations and policies that are applied in the company, firstly, fully correspond to the ideology, and secondly, come from the owner, thus strengthening his influence. It does not matter who developed the policy - the director or one of the managers, in any case, it is issued on behalf of the owner of the company and is mandatory for all employees without exception.

The third point  is that the owner must reserve the formation of strategic plans for himself. We are talking about plans that cover the entire company and take it to a new level. This does not mean that the owner must develop such plans himself. He can involve managers or even outside experts. But these must be his strategic plans, and then he instructs the director to develop projects for their implementation. In this way, the owner has both power and control, since he regularly checks the implementation of projects.


How can an owner save a business when the director changes? Photo 2
The main idea to understand is:



Below we will show you how to safely divide the responsibilities of the owner and the new director of the company so that the cooperation is as effective as possible.




This division of responsibilities will prevent you from losing control of your business.

Here are some tips from Administrative Resource on preventative measures to keep your business safe when hiring a new director.

Tip 1: Research the new director

To protect their business, the owner must carefully check the new candidate for this position, his experience in previous jobs. You can check such data both on your own and with the help of specialists.

Tip 2: Avoid hiring a new director for a competitor

To avoid such a situation, it is advisable to include in the company charter and the employment contract with the hired manager a restriction on his work in competing firms and suppliers. This prohibition is valid for the entire term of the hired manager's work.

Tip 3: Limit powers

The business owner must refuse to fully delegate authority to the director. For example, prohibit the company manager from making transactions related to intangible services, the company's main assets, real estate, loans and credits without his consent.

Tip 4: Have an independent audit done regularly

To protect your business, you need to regularly conduct audits with the involvement of independent experts and personally delve into the reports on the audit and the results of the year. According to statistics, 80-85% of problems in a company are easily detected with systematic control.

Tip 5: Reboot

Don't forget to give yourself a chance to rest to gain strength. As a rule, already on the 5th-7th day of rest new ideas and thoughts begin to come, views on familiar things change, plans appear not for a month, but for several years.