Top 5 Mistakes to Avoid When Building a Management Team

Editor’s note: This article is excerpted from “How to Separate Contenders from Pretenders,” a free leadership eBook from Evolve YT. Download the book at evolveyt.com/ebooks.

Finding quality candidates for any job position can be difficult. But what about those who will fill vital management roles?

The ability to lead others is a quality that isn’t developed overnight. Great leaders are continually honing their skills and finding new ways they can make their team great, which makes finding them quickly a difficult task.

Unfortunately, many companies aren’t equipped with the right processes to handle building a talent bench where rising stars are ready to hit the ground running when the position opens.

So, how can you avoid costly and timely mistakes to help build your talent bench? Here, Phil Cooper, chief transformation officer at Evolve YT, shares the top five mistakes companies make when promoting employees to management positions.

1. Not Knowing How Many Managers are Needed

The first and most common mistake made with service-based companies is the lack of knowledge when it comes to determining how many managers are needed in order to grow the business.

“I can’t tell you how many companies just don’t understand how important it is to know exactly how many managers they will need in the next two to three years in order for them to grow without sacrificing service quality,” Cooper said. “Knowing this is critical to promoting the right people, putting them in the right seats as well as having talent on hand and ready to go.”

Cooper explained that to determine how many managers companies will need, you need to ask the following questions:

1. What is your current revenue?
2. What percentage do you want to grow and over how many years?
3. How much does each technician produce per year? How many do you need to hire for that growth?
4. What is your span of control? (How many technicians per manager, i.e., eight technicians per one manager.)
5. Are there any current supervisors that are at risk of leaving or are performing poorly?

By answering these questions, you can quickly determine how many managers you will need to fill openings and start your bench. An example is below:

1. $1 million in revenue.
2. Grow 20 percent every year for three years ($200,000 per year for a total of $600,000).
3. Each technician produces $200,000 per year, which means hiring three technicians over three years.
4. Span of control is six technicians per manager.
5. One manager at risk of leaving.

That means one manager for replacement, half a manager needed for three new technicians for a total of 1.5 managers.

So, this company needs at least two managers to grow 20 percent every year over the next three years.

By utilizing this formula, you can determine exactly how many supervisors you need to grow your business over your given timeline. This information also will help you determine your talent bench and how many supervisors you need to build it.

2. Great Technicians Don’t Always Make Great Supervisors

The next mistake companies make is by not having a formal process when it comes to determining who wants to be promoted. How can you build your talent bench without knowing who wants to grow versus those who just want to be great at their job?

“Companies tend to use gut instincts on who they think should be promoted and not necessarily who wants to be a leader,” Cooper said. “So, how can you build your talent bench without knowing exactly who wants to move up in your company without having something in place to find that out?”

By having a leadership program in place, those who want to grow and move up in the company will enroll in the program. During the process, you’ll not only determine their desire to lead, but if they’re really cut out for being a supervisor.

3. No Quick Process to Determine Potential Success

This mistake ties into No. 2 for a variety of reasons. If you don’t have a process for determining who wants to be a leader, you probably don’t have a process in place to find out who will actually succeed when promoted until you actually place them in a junior management position or full-fledged manager role.

By waiting until you put the employee into a management role, your business risks wasting time and money on supervisors who aren’t cut out for the position.

“From our experience, we’ve determined about 50 percent of employees you promote to managers will be good,” Cooper said, “but the other 50 percent will be either average or poor. You don’t want to waste your time, training or money on someone who has the potential to poison the people they are leading. It’s not going to help you when you’re trying to grow your business.”

Having a process in place for determining who will succeed or fail prior to putting them into a management role is vital to scaling your business without sacrificing your service quality.

4. Having Ineffective Supervisors that Damage Your Good People

This is the biggest mistake almost every company has made at some point or another, and yet most companies still have not found a way to fix this.

“If you are putting people into management roles blindly, you’re asking for disaster,” Cooper said. “You’re giving them the chance to damage the team they are leading and hurt the future of your potential leaders. I know because I went through this.”

Cooper explained that when he was CEO of Cooper Pest Solutions, prior to implementing his leadership program, he had kept an ineffective manager for more than 10 years.

It destroyed the morale of the team his manager was leading and in return hurt his business.

“We kept this manager for over 10 years,” he said, “and over the course of 10 years we went through over 20 technicians on his team. Every technician that we lost cost us $15,000.”

That was when Cooper knew something needed to be changed.

“If your leader isn’t making their direct reports great, then they aren’t a good leader,” Cooper said. “Our job as leaders is to make the people around us great, which makes us great and helps the business grow.”

5. Holding onto Ineffective Managers Longer than You Should

Keeping ineffective managers can be the downfall of any business, but it should be noted that just because they are a hard worker who wants to grow with the company, doesn’t necessarily mean they are cut out for managerial roles.

Referring back to his poor manager of 10 years, Cooper explained the reason he kept him for as long as he did.

“We kept him because he was a good worker who put in the hours and helped out whenever we needed him, also we didn’t have anyone to replace him that we felt would be better,” Cooper said. “This is the exact reason why you need to build a talent bench.”

Having a talent bench in place will help you avoid having ineffective managers in roles for too long.

This was the turning point for Cooper, and he quickly decided to create an internal leadership program to help determine his next great managers and build the bench of talent waiting for their chance to shine.

Cooper’s leadership program helped his company flourish in just a few short years, making the firm poised for acquisition. He knew that his leadership program was something that every company could benefit from, which is why he created Evolve YT.

The author is marketing and communications coordinator at Evolve YT. The company offers a variety of supervisor-specific training programs.