Back in the 1980s, the US military realized that too much control over soldiers and sailors in combat and other stressful situations wasn’t such a good thing. (I only know this because as a former leader of a Navy search-and-rescue team, my husband was involved in a number of these missions.) It turns out that being in action involves dozens of crucial decisions, which are far more successfully when made by those on the ground rather than by commanders in some far-away headquarters.
Consequently, the military started to give its personnel far greater latitude to deal with situations they faced. This change in U.S. “command and control” was captured in the movie “Heartbreak Ridge,” as Gunnery Sgt. Highway (Clint Eastwood) trained his Marine platoon to “improvise, adapt, overcome” in difficult situations.
I’m often reminded of our military’s transformation while working with advisory firms. One of the biggest challenges that we see owner-advisors facing these days is finding a management style that works. Like many small business owners, independent advisors often have a hard time giving up control—not only of what their employees are doing, but how they are doing their jobs. In smaller firms—with just the advisors and one or two staffers—that’s not such a problem (although it isn’t usually much fun for the employees in those situations, either). But as firms get larger, advisors who jab their fingers into every pie not only create growth-dragging turnover, they prevent their employees from providing the leverage that was the reason they were hired in the first place.
As it turns out, most employees face dozens of decisions during their working days, too. If they aren’t trained and supported to make those decisions, they’ll take them to the firm owner, who can end up spending more time on these low-level decisions rather than taking care of their clients and growing their firms. At that point, owner-advisors have become “supervisors”: workers whose sole job is to oversee other workers. At the same time, they’ve relegated their employees to laborers, simply carrying out a stream of instructions issued by their supervisor.
What Your Peers Are Reading
Not only is firm growth limited solely by the work capacity of the advisor, but employee motivation and morale plummets, minimizing productivity and maximizing turnover.
In our work, we’ve found that a much more successful dynamic between firm owners and their employees is to empower those employees to take as much decision-making as possible off the owner’s desk. In fact, we’ve come to realize that the success of most advisory firms largely depends on their employees’ ability to make the vast majority of the decisions they face—and their ability to make them correctly.
Making this happen involves two steps: first, employees need to be trained and supported to make good decisions, and then owner-advisors have to change their mindset to let them do it.