Setting the Foundation for Successful People Management

Running a business comes with its fair share of challenges, especially when it comes to managing a team. Whether you have one or a hundred employees, clarity in expectations, roles, and performance metrics is crucial to moving from merely surviving to thriving. Today, let's dive into some practical steps to help you manage your team effectively.

The Importance of Clarity:
As Brene Brown wisely says, "Clear is kind." When you provide your employees with clarity, you empower them to understand exactly how they need to perform and what happens if they don't meet expectations. Large corporations create policies for this reason—to ensure everyone knows the rules and reduce risks. As a small business owner, you should strive to do the same, even if it’s on a smaller scale.

1. Create an Organizational Chart:
No matter the size of your team, an organizational chart is essential. It outlines who reports to whom, helping you understand who is ultimately accountable for each team member’s performance. Even if you’re a small business owner with only a few direct reports, this clarity becomes invaluable as your business grows and you start adding new roles, like middle managers or interns. Don’t forget to include contractors and vendors in this chart too—they are part of the ecosystem and need to be managed appropriately.

2. Write Clear Job Descriptions:
Every role, including yours, should have a job description. This document should outline the role’s responsibilities, minimum qualifications, who the role reports to, and how performance will be measured. Think of it as a roadmap that helps each team member understand what’s expected of them. Use real-world resources like job boards to ensure your job descriptions align with market standards and compensation targets.

3. Set Realistic Performance Goals:
When it comes to performance metrics, goals should be set before the period they apply to—whether that's annually or quarterly. For dynamic, fast-changing businesses, quarterly goals often make the most sense. They allow you to pivot and adjust as your business evolves, ensuring that your team stays aligned with current priorities. Always make sure to define these goals before the period begins so your team isn't left guessing how their performance will be measured.

4. Develop a Compensation Strategy:
Determining salaries and managing cost-of-living adjustments (COLA) and merit increases requires a clear understanding of market conditions. Typically, COLA adjustments range from 2-3% in the U.S., but this can vary based on inflation and economic conditions. Make sure to factor these adjustments into your financial planning to avoid surprises. For performance-based raises, set aside a budget and allocate it according to individual contributions—this will help you reward top performers appropriately and maintain morale.

5. Have the Tough Conversations:
All the policies, job descriptions, and metrics won’t matter if you don't have open conversations with your team about their performance. Sit down regularly—ideally once a quarter—and review goals, outcomes, and expectations. These discussions don’t just measure performance; they reinforce your company’s values and the importance of each employee’s contributions. Remember, the goal is to foster a performance-first culture where every team member understands how they impact the business.

6. Plan for the Future:
With the end of the year approaching, now is the perfect time to start planning for the upcoming year. If you're feeling overwhelmed by the idea of implementing these changes, consider booking a 2025 planning session with a professional who can help you map out your goals, financial plans, and management strategies. A few hours of focused planning could set the stage for a more productive and aligned new year.

Conclusion:
Managing people effectively is more than just hiring the right talent; it’s about creating an environment where everyone knows their role, understands how their performance will be measured, and feels valued. By investing in clarity—from organizational charts to goal-setting—you’ll position your business for sustained growth and build a team that’s as invested in your success as you are.

Are you ready to have your best year in 2025?
If you know what you want to happen and don’t quite know how to make it happen, I have a solution.

You can book a comprehensive 2025 planning session. During the half day session, we complete a full top to bottom assessment of your business in 2024 and set goals for 2025. That’s not all, you will walk away with a plan of action and measurements to keep you on track all year long.

Click here to secure your spot and ensure you're starting the new year on the right foot. Let’s turn your vision into a reality!