Retain Top Talent Like an 1850’s Businessman

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This “1850’s” model of business is rooted in critical thinking and respect for people, not the “common sense” as we hear so often.

by Larry Osentoski

For most growing small businesses, the top issue is how to retain talented individuals. This process can be exhausting, and for most good leaders, it may comprise a majority of their daily activities. I have worked at a variety of firms of all sizes, sectors, industries, and regions. Each had its own culture and methods to business growth (or death). Regardless of the macro culture, I have always been able to establish a culture of success within my sphere of influence because I believe anyone can be a leader. The success of my teams is inherently based on what I call an “1850’s Businessman” approach. This term was coined by a Special Operations client of mine a few years ago when describing me to one of my managers, and it has stuck with me ever since.

This “1850’s” model of business is rooted in critical thinking and respect for people, not the “common sense” as we hear so often. “Common sense” is only a piece of critical thinking obtained through making mistakes and learning or adjusting. Alternatively, critical thinking can reduce the chance of making the mistake in the first place! Successful leaders employ PDCA in every aspect of their business. Plan-Do-Check-Adjust is based on a simple — but not easy — non-branded form of Lean thinking. This form of Lean thinking was employed by W. Edwards Deming[i] in the 1950’s to transition Japan into an industrial powerhouse from the ruins of World War II. As I led organizations to successful engineering developments over the last 20 years, I was not familiar with the works of Deming. However, through the coaching of my friend and business partner, Mike Taubitz, I was able to see that many of the simple — yet not easy — techniques I employed in my business career were not new concepts. They had been used successfully by Deming decades earlier. It seems leadership is leadership whether its 2013, 1950, or 1850.

So, how can you develop the necessary skills to become an “1850’s Businessman” and still stay relevant to the changing needs of the twenty-first century job market? There is a basic methodology I have refined over the years based on three simple — but not easy — skill pursuits.

Be a Leader

Leadership at its core is the ability to show people a path based on personal competency and respect for others’ thoughts and ideas. Your employees don’t have to like you, but they do have to respect you and see WIIFM (What’s in It for Me). Personal competency in the field in which you are working is a good start down this path because you can show someone very clearly where he or she fits into the operation, based on your own personal experience. You can also show that person a career progression, which is an important factor in employee morale and ultimately the retention of staff. Leadership is based in competency, not slogans on the wall or titles in an organization chart. General Motors and others made the mistake of thinking any MBA can manage anything throughout the 1980’s to this day. That form of management is not sustainable because it has no accountability. This doesn’t mean you have to know everything about your organization and direct every action, but it does mean you have to be a critical thinker that solicits and accepts input from all levels of your organization. You ultimately make the decisions for the direction of the firm, but the ability to accept input and adjust your sails goes a long way toward moving the team in a common direction.

Establish an Environment: Everyone Demands Accountability

This is difficult for most people to establish because they don’t set it up with the leadership skill first. President Reagan described this best when he stated the simple phrase “Trust, yet verify”[ii] when dealing with the old Soviet Union. Just because you trust someone doesn’t mean you don’t verify his or her work. That is your job as a leader. How you verify goes a long way toward building mutual trust and respect. In a culture of accountability, a leader refines solutions with a team and then makes an informed, consensus decision. Simply getting everyone around a whiteboard to critically evaluate the system (not the individual) as to why something failed or succeeded usually yields the best results. However, keep in mind that it’s not the tool that fixes the problem; it’s the user’s critical thought. A hammer can be a weapon or a tool; only the user decides. Believe it or not, the accountability of your staff largely emanates from modeling your behavior as a leader. I have worked with leaders who talk about how their entire offices or regions are lazy, entitled, etc. In turn, one might ask these leaders a few simple questions. How have you directed your staff to perform? What choices does your staff have within the system to achieve success? What are your metrics for achievement or failure? Accountability starts with the actions of a leader, not his or her words.

Generate Buy-in through Challenging People

Challenge your people to apply their skills to new applications that result in new skill sets. You need to push people out of their comfort zones and create healthy stress in their workdays. People without stress are dead. Stress, like nearly anything else in moderation, drives the success of the individual and the enterprise. Getting an employee with a gift for organization and numbers into an accounting role from their current role of quality control inspector is a good example. That transition seems obvious, but it takes the commitment of both management and the employee to make it work. There are growing pains that will be resolved as long as all parties are committed to problem solving and not finger pointing. Of all the staff I have worked with over the years, not all of them would sign up to work with me again. In fact, more than a few would run for the door. Keep in mind, this article is about managing staff in a growing firm and not everyone wants to work in a growth firm! Regardless, I’ve had overwhelming feedback over the years that my employees were challenged in a manner that helped them find WIIFM, which led them to great personal and professional gains through increased talents or exposure to new areas. Along the way, the team won, too.

Change is the law of life and those who look only to the past or present are certain to miss the future – John F. Kennedy


[ii] Watson, William D. (Fall 2011). “Trust, but Verify: Reagan, Gorbachev, and the INF Treaty”. Hilltop Review (Western Michigan University)

[i] Deming’s 1950 Lecture to Japanese Management. Translation by Teruhide Haga. Accessed: 2013-10-1.


Additional Reading

A Red Flag for Small Business

The Post Consumer Based Economy and the Need for a National Business Plan


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