The Human Capital Complex

Oct. 1, 2019

Why having a strong team is one of the most important building blocks to growing a business.

I have a lot of shop owners come to me and tell me about their expansion plans. They say, “I’ve got all the money and all of the systems down. I’m ready to expand.” I ask them how much money they have and which systems they have put into place, to receive quick and prepared answers. I then ask, “So, you have all the money capital you need, all the system and process capital you need. What human capital do you have on tap?”

Every single time I ask that question, I am left with a blank stare and the sound of crickets⁠—they got nothing. 

It consistently keeps coming up—people forgetting that human capital is required to build a company.

I hear how owners are going to grow their business and become a massive force to be reckoned with. How they are going to relocate to another location or buy a bigger building; how they are going to do more revenue than they did last year; or how they are going to start marketing to grow their company.

I hear these stories, and every time, they forget that they have to build a team.

If the first thing that crosses your mind when talking about growing your company is not people, then you are not qualified to begin the process. 

You have to think about people, they are your No. 1 resource. 

Companies are built on the backs of quality team members that are able to carry out your vision. If you're not willing to go out and find those people, you're never going to grow. 

If you plan on expanding your business in any capacity, you need to put job ads out, you need to start interviewing candidates, and then you need to interview even more candidates. That way, when you really need somebody, and your back is against the wall, you can stop complaining and get out there and make a new hire or two happen. You have to do whatever it takes to get out there and find that possible option that could come in and save the day.

When looking for new team members, you need to define what your company culture truly is, write it down in a few phrases that can be repeated by others, not just you. 

Once your culture is cemented, you can then begin using it to screen potential employees, making it easier to separate the “winners” from the “losers.”  

Skill and performance are not the only factors that should be looked at with an applicant. You also have to be sure that the shop culture matches up for you with the new possible employee. 

Desired shop culture varies for each person, what may work for me may not work for you, and vice versa. Regardless of the culture you are aiming for, it’s not about whether somebody is performing poorly, it’s usually about whether somebody fits your team, your vision, and your culture.

Once you can understand the importance of hiring based on shop culture, you can begin to really critically look at potential employees, and not feel bad saying “no” to talented candidates.   

That being said, a lot of owners aren’t willing to take a chance on potential employees. They might find a person that is a good fit for the culture but doesn’t know if he or she is going to be a difficult employee. The owner may be unsure whether the candidate can tackle complicated issues that require decision making without the owner's presence. And they need to know that the employee is going to make the right decisions for the business. But there is no way that those characteristics are going to be learned through an interview. 

Instead, you have to get that person on board and not be afraid that it could be a mistake.

You're going to make mistakes, and you’re going fail. But if you're going to build a company, you’ve got be willing to be embarrassed publicly. You just do. You have to keep digging deep and selling the dream.

One of these people that you go and sell the dream to is going to be the right fit, and they will help you jump to the next level. You’ve just got to be willing to bring them on.

Never stop recruiting, and never stop interviewing. You have to have human capital, a deep bench of possible managers, advisors and technicians ready to go.

That person you took a risk on and just hired may end up not working out. Or one of your most amazing people will have a baby and have to leave. Or someone will get married and move across the country. Or decide to join the military. You never know. 

Your company is like a river, it is always flowing and there will always be people coming and going. Hopefully more stay than go, but it all starts with people.   

About the Author

Aaron Stokes

A nearly 20-year veteran of the automotive repair industry, Aaron Stokes grew his business, AutoFix, from a one-car garage to a six-shop operation that is widely regarded as one of the top repair businesses in the country. Stokes, the founder of Shop Fix Academy, is an operational guru with a unique business and leadership philosophy that has led his business to great heights.

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