Managing Hired Guns

Jeannette, the owner of a family business, knew her key nonfamily manager had helped her through many recent business setbacks. Now that the company was back on track, Jeannette wanted to make sure this manager felt that she valued his work and commitment to the company. Her two children, who bad been working their way up for several years, were about to ascend to management positions, and Jeannette was worried that her hired gun might feel threatened. She didn't want to lose him. Now that she could afford to be generous, she decided to give him a piece of the action — just 1.5 percent of the closely held stock.

That decision turned out to be a serious mistake. It wasn't long before this manager began to act like more of an owner than Jeannette had intended. Suddenly he suggested opening a new facility in another town that he would then manage. Jeannette was even more surprised when he asked to see all the financial and legal information she had always kept strictly to herself. Then he began planting hints about bigger and better perks he felt entitled to. The last straw was when he casually mentioned that he wanted to hire his son, who was just out of business school, to fill a new marketing position.

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