Managing and Motivating Small Business Employees

Managing a business, large or small, involves using a wide range of employee management techniques to motivate the business' employees. The overriding concern of any small business manager is to make sure that employees are happy, motivated and working to their full capacity. Managing and achieving your small business' goals and targets is impossible if employees are not fully motivated and invested in the mission and goals of your business.

Recent research into employee management and motivation revealed that the single most important factor in the management and motivation of employees was manager appreciation of employees' performance. When employees were asked: "What qualities differentiate the successful manager from the less, well-informed manager?" the overwhelming answer was "Recognition by management," both verbally and financially, for a job well done.

Managing Employees Through Motivation

For some employees, personal recognition and manager approval is not sufficient to motivate them and retain their loyalty. Managing and motivating a happy workforce, therefore, requires the small business manager to use additional tangible employee management incentives to motivate all employees. Some ideas include:
  • above-inflation rate pay raises
  • paid holidays in excess of statutory requirements
  • involving employees in forward planning and management
  • profit sharing for employees
  • flexible working hours and give-and-take from management
  • family-oriented ethos, with paid leave to deal with family crises
  • productivity-related bonuses
  • comprehensive medical and dental insurance plans
  • career management and training for employees hoping to climb the businesses' management ladder.

Setting Employee Management Goals

As a business manager you will need to define your management goals and targets; you will also need to establish which employee management techniques work best.

The key to successful employee management and to achieving your business' goals is a sound knowledge of your individual employees' strengths and weaknesses. Encourage your employees to "look outside the box" at your business' long-term viability.

Individual employees' targets are all well and good as part of an overall employee management strategy, but they count for nothing if employees feel that they are being treated as numbers on a monthly target spreadsheet. Managers, therefore, need to understand this concept and develop employee management goals that focus on their employees' unique abilities to achieve the small business' long-term objectives.

In addition, employee management studies of small businesses have shown that management goals are more likely to be achieved through employee group discussions, where individual employees are praised openly in front of their fellow colleagues. Similarly, obstacles to achieving a small business' goals are more easily overcome when employees are not challenged directly by their managers.

Employee Management and Performance Appraisals

Often viewed as a necessary evil by managers who are "too busy" managing and running their business, a well-conducted performance appraisal is one of the most powerful employee management tools available.

Benefits of Performance Appraisals

Benefits to both managers and employees include the opportunity to set employee management goals, identify and address problems that may be affecting an employee's productivity, and receive useful feedback from individual employees. Above all, the performance appraisal provides the astute manager with the most effective employee management tool of all, namely the chance to praise, motivate and recognize the employee's achievements.

Conducting Appraisals: Tips for the Small Business Manager

  1. List your employee management objectives and points to be discussed beforehand.
  2. Gather examples of the employee's recent performance.
  3. Adopt a non-confrontational approach throughout; employees appreciate managers who use open-question techniques.
  4. Help your employees develop solutions for problems raised during the appraisal. Managers who actively involve their employees in several aspects of employee management are known to achieve higher productivity, as well as happier employees.
  5. Focus on your employee's career development and training needs. Some employees want to climb the career ladder and progress to a position in employee management, themselves; other employees are quite happy with a modest pay raise.
  6. Agree to a set of goals with the employee in accordance with your employee management strategy.
  7. Document and check all information with employees at the end of the appraisal and set a date for a follow-up meeting.
  8. Give employees copies of their performance appraisal.
  9. Draw your employees' attention to your appeals procedure, should they feel that management has treated them unfairly.
  10. Use employee feedback to develop your management skills.

Addressing Employee Management Problems

Managers of small businesses have several advantages over larger businesses with hundreds of employees. For starters, small businesses tend to have a shorter chain of command and more flexible management procedures for addressing problems before they get out of hand.

The inability of certain business managers to deliver and receive information effectively, and to keep employees in the loop, is well documented. Poor communication in the day-to-day managing of any business can have catastrophic effects, not only on employee morale, but also on your business' long-term survival.

Good communication, however, is an acquired skill. Not all managers are natural communicators; most successful managers have had to learn how to communicate effectively with their employees through formal employee management training and education programs. Often it takes small business managers years of practice before they become adept at employee management communication techniques in the business-working environment.

The Importance of Communication Training for Small Business Managers

Poor communication can damage both employee and management morale and productivity.

Ultimately, a business manager who has received employee management training in communication skills and is able to communicate effectively is an invaluable asset to any business. A manager who is also a good communicator will know exactly how to get the best out of employees. Such business managers will also save your small business time and money, simply by using effective employee management communication techniques to avoid potential problems between management and employees.