In my previous blog post I explained that when I first came to Dickinson, North Dakota in 2011 to work in the oil field, one of the problems that I saw in company management, was the failure to properly delegate work.  Existing companies could not keep up with the demand for work partly because owners and managers could not see or understand that they needed to delegate work to competent people in order to be able to handle the increased demand for work.  The second big problem that I saw was nepotism, the hiring of relatives and friends.

I will try to get right to the point, whenever I have worked at a company where the owners or managers hire relatives and friends, everyone else suffers and pays for it.  Ultimately, it costs the company tremendously, if it doesn’t cause the ruin of the company altogether, which I have seen happen, in Dickinson.

First, is it a good idea to hire someone for a position at a company, if you know that they would not ever be hired for a similar position at any other company, or that you would never hire them if they were not a relative or friend?  How could this ever be a good idea, to hire someone that you know is not capable of doing the job?

I experienced this at one of my first jobs out of college.  The owner of the company that I was working for, hired his much less capable brother to manage the estimating department.  In compiling estimates, it is most important to not leave anything out, and to total the costs as completely and accurately as possible.  The owner’s brother would waste everyone’s time with daily memos on the new required font type for weekly reports, who was required to use green marker pen, red marker pen, blue marker pen in making comments, who was in trouble for not using the most recent new required font type, etcetera.  After a while of causing problems and causing work to have to be repeatedly re-done in the estimating department, the owner’s brother was put in charge of the sales representatives instead.  He drove the sales reps up the wall, causing some of them to quit.  Eventually the owner’s brother irritated the owner himself so bad, that he had to let him go, but not before he had irritated and upset everyone at the company, causing more than several people to quit.

The hiring of relatives and friends of the owners and managers has occurred at every company that I have worked for in Dickinson.   The third company that I worked for in Dickinson, this caused the failure of the company.  When I first started working for this company in May of 2013, the company had a lot of intelligent, competent, skilled technicians and workers.  The main company that we performed work for, liked all of the technicians and workers because of their intelligence, ability, and work performance.  But then, the owners of the company hired one young lady who was a niece, and one young lady as a favor to a friend.

Neither of these two young ladies had any construction experience whatsoever.  Not even hammering a nail or digging a hole with a shovel.  Some of the technicians and workers who had been working in construction for ten years or more resented this.  Several of the best technicians left soon after these two young ladies were hired.  They resented that they were being paid within a few dollars of what they were making, that they weren’t any help, that they would have to show them how to do every single thing, and that they were not interested in construction, only the opportunity to get paid a lot of money by being present on the job.

The company owners’ response to several lead technicians quitting within a few weeks, was to move their niece right up to driving the service truck and taking the lead.  The company that we did the work for did not like this, nor the did the end users.  It was obvious to everyone that the twenty year old niece had never done any kind of construction whatsoever, and that this was not an acceptable replacement.

At this same time, the second young lady that was hired, she came to work with the crotch of her jeans missing, a hole about the size of a dinner plate.  I figured she was going to try to have some kind of sexual harassment claim if anyone said anything to her.  The company that we did the work for, several of their employees complained to the owners of my company about this.  What is wrong with her, and do not ever have her come to work for us like this again.  The work that had already been awarded to the company I was working for was completed, and they never got any more work awarded to them, ever.

The most recent company that I worked for in Dickinson, the effects of hiring relatives and friends was very noticeable.  There were people in management positions that probably never would have been placed in a management position at any other company.  There were people that were hired, that would not have been hired most other places.  There were people working there, that would have been let go a long time ago anywhere else.

The net overall effect of all these relatives and friends working there was very bad.  There were areas of responsibility that no one was taking responsibility for, or even paying attention to.  There were people not showing up for work, without any preparations having been made to cover their absence.  No one was very concerned about anything, because they were not in fear of losing their jobs.

This most recent company that I worked for in Dickinson, I have seen the very beginning signs of bankruptcy, and I think that this will become common knowledge within about one year.  The failure of this company might not have occurred if the owner would have hired experienced managers with degrees in business administration, accounting, economics, finance, or construction management, instead of relatives and friends with little experience and no business education.