'I Think I Can Manage, Thank You' is a weekly column (daily for this story) by Steven Bates, manager of Bookery Fantasy, a million dollar a year retail operation in Fairborn, Ohio. Today's column follows up on two previous columns on his story of the breakaway employee (see ''I Think I Can Manage, Thank You'--Breaking Away' and 'I Think I Can Manage, Thank You--Breaking Away, Too'). Today, he talks about prevention.
My last few columns have dealt with the 'breakaway employee,' a trusted team member who takes everything you've given them--the training, experience, and professional contacts-and opens a business in direct competition with you. They may attempt, as happened in our case, to lure your customers away, or engage in a campaign of disinformation to undermine your business. All too often, you're caught completely off-guard by this kind of betrayal; chances are, you consider this employee to be loyal, trustworthy, and honorable (why else would you have hired them?).
Yesterday's column encouraged employers to watch for early signs of trouble and to trust their instincts, potentially heading off serious trouble before it gets out of hand. Terminating a manager or department head creates more problems than letting a part-time clerk go, to be certain, but ignoring the warning signs and just hoping things get better puts all of the control in their hands, and none in yours.
Terminating an employee is never easy (though it can be cathartic), especially for the small business owner/operator. Since many of us hire friends, we see the possibility of serious conflict as a non-issue. Bookery Fantasy almost always hires from within, a customer or friend of a friend, someone we think we know and believe we can trust. If my experience means anything, it's this: you just don't know people as well as you think. We were blind-sided by this employee's actions. We were also naive. Most small business owners (and, I would venture to say, virtually all comic book and games retailers) never prepare for competition from ex-employees, though almost all of us can tell a story about someone we know who it happened to.
One possible solution might be a non-compete clause or contract. Major corporations require high level employees to sign one, in theory safeguarding the employer from someone stealing business away from an insider's vantage point. Like prenuptial agreements, non-competes are designed to protect the one with the most to lose from the one with the most to gain in a potential business tug-of-war. Unfortunately, they can be costly to enforce, as each state's labor laws are different. If nothing else, having a manager sign a non-compete contract might give them pause before jumping ship to start their own hobby shop.
If, like us, you're wary of involving lawyers and judges to resolve problems, try a more direct approach. Ask. Be involved. Good managers are in constant contact with their employees, and should have a fair idea of what makes each person tick. Quarterly reviews would be a good time to cover questions like 'Are you happy with your job? With your pay?' And, 'What are your short- and long-term plans with the company?' Their answers, and your ability to 'read' their responses, could be all it takes to defuse a situation like the one we experienced. If you get replies you don't like, press on, dig deeper. You can be firm without being rude, insistent without being prying, but stay focused. This is business, after all.
I took the branch manager's actions personally, because I considered him to be a friend, and that tainted my approach. I hesitated to dig deeper when rumors started flying about his plans, because I didn't want to believe them (remember, listen to your 'gut instincts!'), just as I had given him the benefit of the doubt so many times in the past.
A friend suggested something called the '360 degree appraisal,' used by large corporations to evaluate employees. Simply put, it involves performance reviews by upper management, peers, and subordinates (optionally anonymous in the case of subordinates), and often brutally honest. By encircling the employee and reviewing them from multiple perspectives, it helps paint a clearer picture of their actual on-the-job success. For a small retail operation, with only a handful of employees, this might not seem feasible. But why not extend that 360 degrees to include customers? If we had not gone 'underground' to a network of customers and local hobbyists, we might never have uncovered the truth about our branch manager's plans. Even if you don't discover a 'smoking gun' or big secret about your employees, you might find out how customers really feel about your stock, your store, and your staff.
