Boss’s Tantrums May Reflect Desire To Retain Total Control

While most of our readers probably aren’t entrepreneurs, (yet) their lives can be significantly affected by these powerful over-achievers.

Q: I work for one of those entrepreneurs you write about. I’m a foreman with quite a bit of responsibility and I report directly to the owner. Every once in a while I seem to approach him the wrong way and he goes ballistic, shouting, cursing and foaming at the mouth. What am I doing wrong? Is there a secret to dealing with these kinds of people?

A: A typical entrepreneur is a unique creature with a host of idiosyncracies that periodically manifest themselves to varying degrees.

Even if you carry out your duties faultlessly, you should expect the occasional entrepreneurial eruption. It comes with the territory in most small, growing companies.

The genesis of this behavior is the entrepreneur’s need for control. He (or she - this is not only a malady of males) probably chose this career path to avoid working for somebody else and suffering their control. Owning their own businesses gives entrepreneurs control and allows them to escape someone else’s control and authority.

Entrepreneurs want to control their time, the activities of the company and its employees, and the responses of their customers. Most of them cry themselves to sleep because they can’t control the competition!

Psychologists tell us that this comes from an “internal locus of control” that is unique to achievers. They march to an “inner drum” and this gives them extraordinary power to accomplish and attain.

To be sure, most companies wouldn’t survive their start-up phases if it weren’t for the single-minded conviction and hands-on control of their founders.

Of course, over time, as a company grows and prospers, many venturers tend to really believe they are omnipotent and they become convinced that no one else can do things as well as they can.

They eschew delegation of responsibility to others in the firm and want to be involved in all of the nitty-gritty details of operation. Not only do they believe that this kind of control is essential to the welfare of the company, but it gives them the warm, fuzzy feeling of insulation from the interference and control of others.

As a consequence, when you waltz into your boss’s office on a day that a lot of things seem to be evading his grasp or direction, and suggest something that appears (to him) to be shifting some control into your hands - or into the domain of other employees - he’s probably going to react like the little kid who couldn’t have it his way.

My ol’ uncle Ollie used to respectfully refer to this as the “snap factor” and learned to read the telltale signs that prompted him to keep a distance on his boss’s “bad” days.

In most cases the owner grows out of this control mania as he gradually realizes that he needs the inputs of other talented people in the company. One way of convincing him of this is to suggest that he isn’t getting his money’s worth if he doesn’t tap everybody’s potential to the fullest.

Remember, without these kinds of entrepreneurial tantrums, many of us would not have jobs today.

Q: I took over the family business from my father a year ago. It has good prospects, so my two younger brothers who have jobs outside the business want to buy some of the stock I acquired. I don’t have a problem with cutting them in, but I am worried that they might later sell their shares to someone outside the family. Is there any way I can sell them some stock but prevent them from selling it to others?

A: A good tool for controlling the future transfer of stock is the “shareholders’ agreement.” If they are willing, you can have your brothers execute an agreement at the time of their purchase that limits their options with respect to resale.

For example, the agreement might give you or the firm the “right of first refusal” if your brothers receive a legitimate offer to sell to an outsider.

If you are worried about your ability to eventually sell the company if you can’t deliver 100 percent of the stock to a buyer, you can effect a “bring-along” right in the shareholders’ agreement which requires a minority shareholder to sell his shares to a third party whose offer to acquire 100 percent of a firm’s stock has been accepted by a majority of the shareholders.

These and other issues impacting family businesses are thoroughly addressed by attorneys Michael and Scott Friedman in their very helpful book “How to Run a Family Business” published by Betterway Books (1-800-289-0963).

, DataTimes MEMO: If you have a question or suggestion for this column, call 1-800-237-6118, or write via E-Mail to TFPK29A@prodigy.com. Paul Willax is the Sandifur Distinguished Professor of Entrepreneurship at Eastern Washington University.

The following fields overflowed: SUPCAT = COLUMN, QUESTION & ANSWER - Entrepreneurship