Each week, we seek expert advice to help a small or medium-sized business overcome a key issue.
Gavin Green was a 19-year-old working at Pizza Hut when Chris Kapsalakis hired him to help build the website for KapscoMoto, an online business selling motorcycle parts and accessories.
"He had no experience," says Mr. Kapsalakis, who had been running KapscoMoto out of his house for three years, ordering parts from China and reselling them through eBay, Amazon and his online store. "I needed someone cheap to help out."
Little did he know that six years later, Mr. Green would become his second-in-command, a jack of all trades able to seamlessly shift from training sales representatives to fine-tuning warehouse logistics.
"He's got his hands in everything. Everyone knows if I'm not here he's in charge," says Mr. Kapsalakis. "He has helped me achieve my vision a lot quicker than I could have with anyone else just wanting to come in for the paycheque."
But now, with 15 employees and growing, the Pickering, Ont., business needs more managers. Mr. Kapsalakis would like to have more time to focus on the long-term strategies and vision of the company.
"We're at the point where I need another Gavin," he says.
Between 2008 and 2013, the company grew by 1,892 per cent, and last year it pulled in between $5-million and $10-million in revenue. KapscoMoto ships its products – ranging from motorcycle handlebars to LED lights to key chains – worldwide, with exports making up 80 per cent of sales.
The company has grown beyond its 12,000-square-foot storage and retail space and has begun to stock products at a nearby warehouse. But as his team swells, Mr. Kapsalakis finds himself nostalgic for the days when he had only four or five employees to worry about.
"It was more manageable then," he says. He has been struggling to get on top of day-to-day operations such as listening in on the odd customer interaction or making sure the day's orders are filled.
He has toyed with the idea of training employees to be managers, but their average age is 20 to 25 and they lack the experience and initiative to lead. The grooming process requires too much of his time.
He recently hired a customer service manager who had experience at banking call centers, but it didn't work out. "Coming into retail, I'm not sure that transitioned well for her," says Mr. Kapsalakis. "She lasted about 30 days."
He doesn't know what to do next, but he knows he needs a buffer between himself and his employees.
"I've spent the time to try to build people up and considered hiring at a higher price tag," says Mr. Kapsalakis. "I don't know what's left; neither have worked out for me."
The Challenge: How should Mr. Kapsalakis go about finding management-quality talent?
THE EXPERTS WEIGH IN
Julie McCarthy, associate professor of organizational behavior and HR management at the University of Toronto's Rotman School of Management, Toronto
In large corporations they run these really comprehensive job analyses that involve focus groups, detailed surveying around the job and feedback.
For smaller organizations it becomes much more difficult without the resources but I would suggest writing out a list of what the core competencies he's really looking for are – what knowledge is required and to what extent. Is it something that can be trained, or that they can get from experience? Maybe they don't necessarily need complete knowledge of all of the elements of moto parts, they could pick it up over time.
It's also worth noting there's a difference between leadership and management. Managers are around maintaining the status quo, keeping it functioning and doing the operational tasks. That can be trained.
But is he looking for a visionary? Someone who can transform and grow the company into the future? If so, hire a visionary transformational leader with lots of energy, then train that individual.
There are also plenty of management schools and courses out there that someone internally at the organization could go through to learn leadership or management skills.
Matthew Saunders, president and managing director of the business accelerator Ryerson Futures Inc., Toronto
KapscoMoto has seen impressive growth in a short time, and the underlying business framework requires scaling to meet customer demand. In addition to hiring a sales manager to bridge the gap, he should think about making the most of his existing work force. Ask his team to offer suggestions on how to improve existing processes. Feedback will help to streamline sales and inventory management. This can be done while also focusing on hiring a manager to support and motivate the team.
He should look for someone with five to 10 years of experience in management, someone with a keen interest in technology who is quick to adapt to change. To test for cultural fit, allow a few members of the team to meet with a couple of the most suitable candidates and ask for candid feedback.
To encourage loyalty, the compensation package can be designed to include a base salary plus performance-based bonuses, as well as options in the company. This combined structure will encourage the new hire to act like an owner. It will also motivate good decision-making, strong performance, loyalty and hopefully long-term engagement.
Milt Reimer, founder and owner of the motocross and snowmobile gear manufacturer and distributor FXR Racing, Winnipeg
We launched in 1994 and have around 100 employees now. I've tried to bring in so many people from outside the industry into power sports and it's really hard, because when they don't know what they don't know and they still act on things, they tend to make a lot of mistakes.
One of the best ways to hire that manager is to poach somebody from an existing dealership or from the sales team at an original equipment manufacturer like a Polaris who already has those sales or accessory management skills. Those are where a lot of guys who want to get that next level job come from.
A lot of it's networking. We were looking at launching a new dealership here in Winnipeg and I just started going to local tracks and hanging out with a group of riders. I knew quite a few guys and started asking them questions and they really had the drive, the work ethic, the personality and the people skills I was after. It's just really grassroots like that.
THREE THINGS THE COMPANY COULD DO NOW
Pay for management training
Enroll a promising employee in management courses.
Create a performance-based pay package
Whether he's looking internally or externally, amend the compensation package to include commission or performance-based incentives.
Do grassroots networking
Put feelers out among riders and motorcycle enthusiasts at tracks, trade shows and other industry gatherings.
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Interviews have been edited and condensed.