So you want to open another office or manufacturing location. Are you aware of the challenges that await you? I surveyed local and regional corporations asking them about their experiences with managing multiple locations. The survey results are as follows.
Challenges
A major challenge is having sufficient time to spend at each location. The ability to prioritize while dealing with the day-to-day interruptions is another. Allocating the appropriate amount of working capital to each location is also a challenge.
The respondents agree that you need to work hard to ensure consistent operations and support of staff, while making sure your staff don’t feel or perceive disconnection with your mission. Differing management styles create a need to ensure all locations are working toward the same goals. Without a central mechanism tracking timeliness and milestones on a regular basis, multiple locations become a challenge to time commitment. No matter how much we strive for consistency it is important to understand the differences that exist between the multiple locations and the home offices.
Management style
“Adding a new location put an increased demand on my time, forcing me to do a better job delegating to my management team” responded one owner. “I like to be very hands-on with all the locations and adding the new location stretched me pretty thin.”
“Adding another location forced me to take my game to the next level,” another business owner said. “I was literally forced to trust and delegate much more because I spent more time traveling.”
“No matter how widespread your organization becomes, you need to work hard to retain team cohesion and the philosophy that everyone is on the same team, regardless of where they work,” said Eric Bloom, the president of Manager Mechanics. “Initial integration requires a micro-management level of oversight, a management style.”
Overcoming the challenges
Including the new location in weekly senior management meetings and meeting at that location every four weeks increases the level of communication. Systematic communication keeps all of the employees on track and involved in the achievement of the common goals.
One owner said that his typical response is to throw himself in the middle of challenges. He went on to say, “I have found that it is much easier to learn when you are in the middle of the game rather than if you are the Monday morning quarterback.”
Middle management
“Middle management is the key to a great company culture, brand and our success,” one company president said. “The senior managers work with the middle managers to create a strategic plan. We rely on middle management at each location to execute the plan and involve their front line staff in its achievement.”
Strong executive leadership is needed in achieving success.
One company that responded to the survey has managers that are traveling all over the country. They work hard to ensure that they are aligned and communicating toward the same goals. Having a strong management team that understands that challenge and is willing to be a part of the solution is critical.
A team-focused transition plan is important to ensure each location is consistent with the goals of the parent company. The support of a goal-oriented local management team is necessary to ensure that the plan stays on track during any transition.
To paraphrase one owner, “by delegating, middle managers grow; they all have taken their game to the next level because their accountability to each other has had to increase. Oftentimes they have higher expectations for excellence and customer experience than even I do.”
Successes
One company that responded to the survey has a mandatory training program for both managers and front line staff. These annual training programs helped the company achieve the number one fitness group in Arizona for the past 12 years. Its “best practice” program permits middle managers to meet quarterly to discuss what is working, challenges, new ideas and resources needed. This program has kept the company’s brand strong and has created a culture of idea sharing across all locations.
Failure
One president stated, “If we don’t fail once in a while, we aren’t trying hard enough or taking enough risks to keep our company vibrant. We failed when we purchased a location and the demographics just did not support our goal. We wound up selling the location, realizing we are not in the acquisition business and should build new locations from the ground up.”
One company that responded to the survey related that not removing a poor performing employee is a failure. The management team gives employees many chances but now is aware that it needs to deal with these employees sooner.
Another survey response was: “you can be assured that each transition is going to have bumps in the road. These ‘bumps’ or failures derail your primary goals and integration strategy. Many stressed it’s necessary to address failures quickly and ensure the overall plan stays on track. The longer failures linger, the more cost overruns and underperformance situations occur.
Management teams at all locations need to be kept informed of progress on the stated plan.
Executive advice
One nonprofit organization president responding to the survey shared that traveling is important for him and his middle managers. His presence can also mean other things, like taking time routinely to call and discuss issues/opportunities with staff in other locations, recognition in all-staff conference calls, and email shout-outs for good performance. The owner/president needs to communicate expectations and set the pace by including everyone, regardless of their location.
Another stated, “The best advice I can give is to hire the very best team they can find.”
Without a strong team, you cannot succeed with multiple locations. When you communicate often and successfully you will have an employee base that is engaged, feels like they make a difference and that really cares about the business. All locations need competent management to impart transition expectations and goals and make every effort to ensure those locations have every chance to achieve those goals.
Cary Silverstein, MBA, is the president and CEO of SMA LLC and The Negotiating Edge. He leads a group that provides services in areas of strategic planning, negotiation training and conflict resolution, with offices in Fox Point and Scottsdale, Ariz. He can be reached at (414) 403-2942 or at Csilve1013@aol.com.
