Employee Problems: In the Owner-Operated Business

by Business Coach Chuck



The approach that I use in working with owner-operated businesses borrows heavily from the work that I have done with families.  There are obvious reasons for this. For the business owner, the line between work and not work is more often than not, not clear.  Owner-operated businesses often impact and are deeply enmeshed with the family.  Beyond that, however, there are more subtle differences between owner-operated businesses and publicly owned companies. An owner is not an employee.    I’m not talking technicalities here of whether the company is incorporated and the owner is, for tax purposes, an employee.  I’m talking ownership and how ownership itself impacts the dynamics between owner and employee.  

Employees of an owner-operated company are much more subject to any trait, thought, emotion, mood, desire, or belief of the owner than they would be to a manager in a publicly owned company.  This can be a good thing.  The enthusiasm of the owner can be invigorating.  The sense of purpose can be inspiring.  However, there are potential challenges in being an employee of the business owner.  If, for instance, one disagrees or is in conflict with the owner, as long as the owner has broken no law, there is no higher authority to go to.  This means that employees in an owner-operated are very focused on and subject to the owner.   How this plays out in the dynamics of the employee is very much effected by how the owner runs the company.

The power context of an owner-operated business is very much like that of a family, where authority comes from the parents.  There are an infinite number of ways that an individual can be successful in working with employees.  We can, however, point to a few areas of commonality.  Employees need to experience consistency, and know what is expected of them.  When there is disagreement, employees need to know how and to whom to express it in a way that will be accepted in a positive way. Open conflict, indecision and inconsistency, breed insecurity and low morale.   This in turn can often trigger what can be most easily understood as childish behavior on the part of certain employees.  Just like a child in a home where there is parental dysfunction, they learn how to get what they need through subterfuge and coercion rather than being straightforward and direct.  The kind of environment breeds personality issues that creates a living hell in the workplace.

Clear communication of expectations is the first step. An open and curious mind as to feedback about results different from expectation will supports and empowers employees. When responsibilities are clear, we know exactly who to talk to when results are different than expectation.  If we are curious to really find out why these different results happen and we know exactly who to talk to, then we can get real answers.  Toyota developed process called “Ask Why Five Times.”  That is the subject of another article.  After doing our part as owners in this way, we will find out if we really do have an employee problem, or there is a problems with the expectation, process, or something else out of the employees direct control.