The oldest Catch-22 in the business world can make an owner wonder why adding staff ever seemed like a good idea. “What if you train a new employee well and they leave?” a remodeler asks. To which a friend responds, “what if you don’t train them and they stay?”
The thought of training your competition is unnerving, but in times of high unemployment some remodelers are finding the tables turned in their favor. A dearth of business has forced many small remodeling companies to close up shop. In some cases, trained competitors are becoming assets that bring ownership knowledge and construction skill to other remodeling companies: their new employers.
Rumors abound that entrepreneurs in non-ownership positions are prone to head-butting with superiors. Not true, say seasoned remodelers who have hired many former owners to their companies. As with any hiring situation, they say the key is to interview thoroughly and put former owners’ skills and experience to work where they’ll be most beneficial.
Ray Wiese says that hiring former remodeling business owners has paid dividends. “When someone mentions to me that they had their own business, that’s a good thing,” says the president of The Wiese Co., in Sherborn, Mass. “They understand not to waste lumber, that the amount of time they have to put in on a job is critical, that there’s not a million dollars left over at the end of a job. Those are terrific tools they bring with them.”
Chris Wright agrees. “Many of us who like to build things don’t have the skill set to really run a business well,” says the president of Indianapolis–based WrightWorks. “If ownership isn’t for them, the goal becomes fitting into a company where they have a skill set that’s valuable. But when they’ve also got some business experience, to me, that is really valuable.”
Even if a remodeler doesn’t want to, or isn’t able to, sustain a business of their own, experience dealing with vendors, sales, estimating, invoicing, and other issues makes hiring a former owner an attractive proposition. Wright says that one former owner now on his staff as a lead carpenter brings his expertise to bear as a liaison between Wright and the rest of the staff. “When you have someone on the team who’s also pulling for you and understands what the end goal is, it really adds to the company culture,” he says.
Truly motivated former owners will do more than offer a sympathetic ear to their new employers: they’ll keep tabs on their own performance. “One owner I brought on as a salesperson comes into my office all the time and asks, ‘Are you making money on me?’” says Phil Isaacs, president of California Energy Consultant Service, in Rancho Cordova, Calif. “He wants to know that he’s doing a good job and that the company is benefitting from the work he’s bringing in. It’s that kind of insight into how a business prospers that makes someone with ownership experience valuable.”
What’s My Motivation?
Of course, not all remodelers retain their ownership instincts after closing their doors. Some shrug it off entirely and focus solely on finding a job.
“There are a lot of owners looking for employment right now, and you have to be cautious about their motivation,” Wiese says. “All of our people have families, I have a family, and I’ve been through some desperate times. There are people looking just to make a paycheck right now because they need to.” While that may become a hiring factor, he says, understanding why an employ er wants to become an employ ee is critical.
Wright agrees. “You can get a sense that their heart is in the right place and that they just didn’t have the business skills to make their own company work or that they’re just not interested in pursuing the business end of remodeling,” he says. “If their personality will function in your organization and you can make sure they have a job to do, they’ll be able to do what they really excel at. Those are the best kinds of people to hire.”
That said, if a business-skills issue held back the former owner from being successful, Bill Connor, president of Indianapolis–based Connor & Co., says it’s equally important to learn that right away. A former owner who Connor hired 10 years ago turned out to be a good salesperson but a lousy estimator. “He shut down his company to come work for us, and we found out later that he really needed some remedial training on estimating systems,” Connor says. “After a year-and-a-half he went back on his own and he’s still in business.”
Connor and Wiese also have had to deal with concerns of client poaching when entrepreneurial types go back out on their own. In a separate incident, a former business owner and 14-year Connor & Co. employee was laid off when the company downsized in January 2009. The individual tried to access the company’s database to contact clients, which Connor calls “disconcerting.” Thankfully, Connor spoke to the employee and nothing came of the deceitful activity. For Wiese, a laid-off employee did take advantage of the company’s available database.
“During his employment, he had built relationships with some of our clients who asked him about doing some work on the side. We have a policy that doesn’t allow that,” Wiese explains. “When [this employee’s] name came up in a round of layoffs, he took it personally. He called the client who had been interested in working with him, as well as several other clients, asking him what work he could do for them. I can’t blame a guy who’s just trying to put food on the table for his family, but it was disappointing that someone would take him up on it.”
While Wiese says that there were no indications in his former employee’s career that such activity was possible, some remodelers do look for red flags when hiring former owners. Wright looks carefully at job-seekers’ motivations during the hiring process. “A number of guys have come to me over the years, and their approach is almost comical,” he says. “They’ll call me out of the blue, say they’ve seen my work and tell me they’re looking for a job by the hour.” Wright regards these inquiries with skepticism. Someone who just wants a 9-to-5 job may lack initiative or interest. “I know on some level they’re tired of the rat race and want to find an organization where they don’t have to worry about the other things,” he says, “but I’m not going to provide an environment for them to sail through.”