"Everyone wants to be self-employed. But not everyone knows how, or wants to take the risk. What we have done is create a sense of self-employment."
Emulating self-employment builds staff incentive

COMPANY: King Park Electric
TYPE: Electrical trade
OWNER: Peter King

TURNOVER: Approaching $2 million STAFF: 13 full time, one part time

Five years ago, Peter King, 34, launched his business career in Perth with a $1200 Mazda van, $400 of tools and $100 cash. Today, he runs an electrical contracting company with a turnover approaching $2 million, rising profits, and a series of industry excellence awards. His secrets: aggressive tendering, motivating staff through open management, and creating a sense of ownership.

"Everyone wants to be self-employed" King says. "But not everyone knows how to go about it, or wants to take the risk. What we've done is create a sense of self-employment and empowerment of the staff by encouraging them to make their own decisions and by showing them how the business works."

Until he set up his business, King Park Electrical, King had limited experience employing people.
He left school at 15 and took up an electrical apprenticeship. Unsatisfied with the life of a tradesman, he dabbled in flying, gaining his instructor's certificate then travelling overseas. He returned in 1994 with every incentive to work hard. "I was unemployed with kids and commitments," he says.

King resumed work as an electrician, but this time with a business plan. His target market was commercial and government work, a timely move as the outsourcing wave swept through West Australian Government departments. Cold calls on prospective customers soon led to 15-hour days and the need to start employing staff. "The electrical trade is like all trades," King says.
"Staff never stay long. Six to 12 months is a good stint."

With the help of an adviser, David Deane-Spread, King looked at the fundamental question of why people work and what makes them happy employees. He found that money was a small part of the equation. Job stimulation, a sense of ownership and the ability to make decisions were bigger issues.

As he built his business, and created his own computer software, King also developed programs to encourage financial openness. Staff get monthly profit and loss statements and balance sheets. They participate in a profit-sharing scheme and help with productivity benchmarks and planning. Deane-Spread, who runs a "self-empowerment" training consultancy, has encouraged King to develop attributes in his staff that go far beyond work skills. "We are developing a positive attitude towards health and relationships, both at work and at home," King says.

The motivational approach does not yet include staff shares. That may come later. "It's easy to give away the business," King says. "But that does not always provide the best result."

With his "home brew" of empowerment and delegation, King has created a company that has lost no staff in three years, has lifted turnover by 54% in the latest year and is budgeting for another big increase this year. Workers are free to join a union (some have), their wages are about 10% above the industry average and they participate in a 15% profit sharing agreement. King says:

"We have shown trust in our workforce by opening the books and showing how a business must run if it is to grow. We provide accountability, a sense of ownership, self-direction, profit share and training. We are looking for a culture of perpetual improvement."

King has discovered that electrical contracting may be only a step towards doing something else. The management skills developed in one business are transferable to others, and expansion is on the agenda . "We have a management formula that we can take into any trade. Refrigeration and mechanical contracting look like good opportunities."

BRW October 22,1999 TIM TREADGOLD

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