Business Coaching Blog
How effective is your Management Team?
Saturday, March 21st, 2015
Why is it critical for an SME to develop an effective management team?
- As SMEs grow it becomes more difficult for the founder(s) to run the business on their own – they need to find ways to involve other people in defining business vision and strategy
- Delegation means managing through objectives and key performance indicators (KPIs) and this requires both a shared vision and a management forum to review performance and decide actions
- You will almost always arrive at better decisions when you discuss them and arrive at a joint view
- Often potential acquirers put a high value on the quality and performance of the management team – after all, you won’t be there any more
What is a management team for?
The management team:
- Creates the organisation’s vision
- Defines the most effective strategy to achieve this
- Sets priorities for resources and actions (the plan)
- Reviews performance against plan
- Decides and assigns actions to keep the organisation on track
What factors make a management team effective?
Members of effective management teams:
- Think in terms of the whole organisation first and their own function second
- Move easily between detail (tactical) and overview (strategic) perspectives
- Accept responsibility for overall organisational performance and expect challenge from others on their own functional areas
High-performance teams* demonstrate
- Individual accountability based on
- Commitment to the goals of the team gained through
- Challenge and constructive conflict enabled by
- Trust between members
How can you develop an effective management team?
- Design the process so that desired behaviours are encouraged and development of an effective team becomes an explicit activity
- Make explicit the purpose and functioning of the Management Team and the responsibilities of its members
- Change the performance of individual members by providing feedback and coaching. In SMEs this may be problematic
- The senior management layer may consist largely of supervisor-level staff who have little or no management experience and may also consider that they didn’t sign up to run the business but to carry out a functional role
- The leader is probably the main shareholder and the person accustomed to making all the decisions and so may not naturally draw out or encourage other’s input
- Be aware of the way you lead. Nothing in this document is advocating democracy or abdication of responsibility for the final decision but effective leaders:
- Change their leadership style to suit the circumstances
- Develop other leaders, not more followers
- Change the membership. This is usually the MD’s direct reports by default so poor performance in the Management Team may have wider ramifications for the future growth of your business