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Your employees can make or break the success of your business. Set the rules, but don't be a micromanager. Seeing people succeed on their own can be a great source of satisfaction.

Employee turnover is scary to me as a small-business owner. It means not only additional expenses to advertise, screen, interview, hire and train a replacement, but also a decline in customer service until the new employee learns the store merchandise.

When I purchased my game-and-hobby store in November, turnover had been high. With the exception of one employee, none had stayed more than seven months. Most new hires lasted only two.

It didn't take long to learn why. Morale was low. The business had been for sale. The previous owner had allowed the stock to get stale, telegraphing the store's uncertain future. He also was stressed about selling the business and employees bore the brunt.

Detailing Expectations

I have eight employees, all game enthusiasts in their early- to mid-20s, most earning a little over minimum wage. Each brings a passion for the merchandise, whether it's collectible-card, role-playing or strategy board games. But even this couldn't overcome the store's morale problem.

Things had to change, and fast, since the Christmas shopping season was upon us. After cleaning the store and ordering fresh stock, my next task that first week was meeting with each employee and writing job descriptions for each position. These clearly defined responsibilities and expectations. I gave my manager a monthly sales goal and made it part of his annual performance evaluation. Employees knew what I expected, and they knew their work would be regularly monitored, evaluated and rewarded with financial bonuses if successful.

I learned the value of job descriptions at my last corporate job, working with senior management to create a new bonus structure for employee compensation. It may seem unnecessary for a small one-store operation to undertake this process. But I'm laying the foundation for a personnel policy that will be essential as my company grows. Detailed records from the start will make expansion easier.

Stepping Back

My corporate experience taught me that the greatest source of employee satisfaction is the feeling of accomplishment from having and exercising responsibility. Yet, as happens with other independent operators, fears of a poor employee decision cratering my bottom line turn me into a micromanager. Allowing the manager and assistant manager to make important decisions, including financial calls, has been the hardest precept to follow as a new business owner.

Even after several months, I at times still felt the need to be at the store from open to close, overseeing what each employee was doing (or not doing). It was counterproductive. My manager confided that he felt the other employees considered me the manager and he nothing more than a co-worker with a bigger title. So I've taken a step back and I'm trying to give my employees the opportunity to showcase their skills. I now know that as a business owner seeing an employee succeed can be a great source of pride.

A case in point: my assistant manager has been running a weekly tournament for a trading-card game, Magic: The Gathering. Part of the entry fee goes to the winner and prizes for other players, with most of the proceeds going to the store. I've allowed him to decide what to do with the rest, and he's hit some home runs. For example, he started a monthly pizza night for the players and awards door prizes.

The results speak for themselves. Weekly participation has increased from five players to an average of 28.

Respect and Concern

I try to view each of my employees as a partner, not just as an employee. I treat them with respect and let them know how much I appreciate them. For example, I ask their input on inventory selections, giving them a voice in store decisions. Sometimes I buy the staff dinner as a show of thanks. Although these actions aren't monumental, they help foster job satisfaction.

I also make an effort to learn about my employees' interests and lives outside of work. Most are struggling to balance a hectic schedule, and work isn't the most important part of their day. When employees want to leave early to spend time with their family, it generally isn't a problem. If they want to adjust their schedule to attend a child's play, for example, we make accommodations. This flexibility isn't costly or time-consuming, but it gives employees a greater feeling of balance when they need it.

The results: Although I had to fire a couple of employees whose work ethic didn't measure up, no one has quit voluntarily in the seven months I've owned the store. Tardiness and absenteeism are nonexistent, and the employees are upbeat and display positive attitudes. There's still room to improve my delegation skills. But my employees know I have their best interests in mind, and they'll be the reason for the success of my store.

From StartupJournal.com
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