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The State of the Firm: An Annual Review for Owners and Employees

Getting everyone on the same page can improve your operational efficiency as well as motivate and re-engage employees.

Helen Modly and Tommie Monez, 02/09/2012

Sometimes you just have to wonder whether you are using your staff and other resources as effectively as possible. You can't just assume that they understand the economic realities of your firm and how they contribute to your success. It's time to create a formal process.

Small firms tend to start out with one or two principals, a healthy dose of optimism, and maybe a support person. New employees get layered on one at a time as the firm reacts to structural stress. As the organization grows, you end up with a collection of employees who joined under different circumstances rather than an integrated staff that share a common understanding and vision. Getting everyone on the same page can improve your operational efficiency as well as motivate and re-engage employees.

Ask yourself these five important questions:

• Does your staff understand the firm's goals and the obstacles to success?
• Do they understand what role they play in the firm's success?
• Do they act and feel like they are part of a team?
• Do they show that they feel valued, respected, and appreciated?
• Are you getting the most out of your investment in your employees?

One way to accomplish this is by holding an annual "state of the firm" meeting in which the firm's goals are articulated, and everyone's roles, rewards, responsibilities, and work flow are reviewed. Owners of small firms wear a lot of different hats, and it can be hard to set aside time to work on the business of running the business, but the rewards can be significant. Pick a day no more than six weeks out and put it on the calendar for all employees. Start the meeting in the morning and bring in lunch if necessary to complete the process in one day.

Getting Ready for the Meeting
Decide if you need to hire a facilitator.
A facilitator can help keep the meeting on track and ensure that everyone gets a chance to be heard. Using an outsider to run the meeting can keep management from dominating and allow for a greater exchange of ideas. Facilitators are particularly useful if there are serious communication problems, significant changes in job functions or personnel, or the firm is changing its direction or focus. Costs can vary widely depending on whether or not the facilitator is tabulating and reporting results. Expect to pay anywhere from $300 to $5,000. If there is someone in the organization who has experience and can effectively serve as the facilitator, then you may be able to avoid this expense.

The author is a freelance contributor to MorningstarAdvisor.com. The views expressed in this article may or may not reflect the views of Morningstar.

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