What are the best practices for creating a middle management layer?
August 25, 2021
by an investor from Harvard University in Denver, CO, USA
I'm hoping a few of you in the Searchfunder community can offer some opinions or resources for businesses that are moving from being 2-layer management structures to 3-layer management structures (ie creating middle managers) for the first time.
Our business is a roll-up in the music education industry, and we just acquired our 22nd location. Currently, each of these locations has a location manager, and that person reports to either the CEO or COO of the business. As we continue to grow, this number of direct reports can't grow to infinity, so we're planning to create 2-3 regional manager positions that would each manage 8-10 locations.
In particular, I'm worried about the risk of "culture shock" for location managers that are used to reporting to a c-level person feeling like they're getting "layered" and taking that really poorly.
Any advice is welcome!
from Michigan State University in Chicago, IL, USA
-- Run a common language around goal-setting. In our business we ran EOS/Traction, but OKR, 15Five, or anything similar would do just as well. That way, there's a standard set of metrics that store managers would be accountable for that doesn't change with new management -- so they get the comfort that their goals are the same even if reporting is different
-- Hire from within -- when I hired a sales manager, I promoted my best-performing salesperson. Since those metrics were public, it was clear that i had made a decision based on quantifiable performance. Plus, the team knew and respected the "new" manager, as opposed to having distrust upfront
-- Keep the lines of communication open. I made clear that I was no longer their direct boss but kept an "open door" policy for folks who wanted to talk to me directly. While I had to shut down a couple "end runs" around managers, overall this let me understand the front lines of the business more and helped the folks 2 levels down know that the CEO still knew who they were and cared about them
-- Clearly communicated the reason for the change, individually, to everyone affected.
Hope that helps, congratulations on your success in music!
John
from Victoria University of Wellington in New Zealand
Will be watching the answers with interest!