Posted by: Andy Porter | February 13, 2012

Creating a successful Owner – Office Manager Relationship

In order to have a successful working relationship between an office manager and the owner of the business there are several very key actions which MUST be established AND maintained.

If these actions are dropped out or start to be neglected you can rest assured that the result will be disharmony and strife, followed soon after by decreasing profit.

First and foremost the owner and the OM must have a written agreement as to scope of work. In simple, concise form the duties of the OM must be delineated. This agreement is NOT a description of how to actually DO each duty, but rather serves as a list of what the duties encompass.

This basic agreement should also include such details as hours of work, pay and any bonus.

NEVER leave any of these details vaguely stated, or even worse, NEVER make any verbal agreements on these points. Both sides should have signed copies of any agreement made as to scope of work, hours and compensation.

Once this is complete it is expected that both parties will actually follow the agreements. For example, if the owner has delegated the hiring of staff to the OM then the owner simply lets the OM do the function and does not butt in or micromanage the process. Another example would be if the owner has NOT delegated the duty of advertising and marketing to the OM, yet the OM is making and signing agreements with various vendors, committing business monies to marketing programs with out approval from the owner.

In short, the owner would not ever chastise the OM for not handling duties not previously delegated to the OM and the OM would not ever exceed his or her level of authority.

Theory of the OM Post

The general idea of having an OM is that this frees up the owner/practitioner to spend all his/her time treating patients and/or dealing with clients. Only the practitioner can deliver billable minutes and hours and so every minute the owner spends working on resolving a staff dispute or unclogging toilets is viewed as wasted (and unrecoverable) billable time.

From this view the more the owner can delegate to the OM the better for the practice.

Owners are generally well trained in their area of expertise, whether this is being a veterinarian or an auto mechanic, and the owner is often specifically NOT very adept in handling personnel and other management issues. In fact in many cases efforts made by the practitioner to handle these management areas lead to bigger problems.

The general mood or tone of the owner/practitioner is important. Often the owner is one of the biggest producers of revenue for the business. If the mood of the owner is decreased through dealings with management issues this can have a significant effect on the owners personal production statistics. Without question a high tone or good mood tends to improve the statistics of the owner (or any production worker, for that matter). Keeping the personnel and day to day management problems off of the owner can in itself increase the production statistics of the company.

In any medical setting, be it human or veterinary, any and all technical questions are always routed to the doctor to handle. The receptionist or manager does not answer patient medical questions for the reason that they are not trained or licensed to do so. This applies equally in many businesses, such as computer or auto repair.

This same policy is wise for any practice owner as regards to management issues: Hire a competent manager and route all of these problems to him or her for handling.

If the OM is clearly unable to perform the functions, there may be a short period of time during which the owner may try to train the OM in how to properly handle the post. But more likely what the owner needs to do is to find a new OM, one who is competent to handle the post fully.

Note that having the owner bypass the manager and do part of the OM’s job duties is NOT the way to go. The policy is that you either trust the OM to DO their job and get out of the way and let them do it, or you emphatically do NOT trust the OM, at which time one needs to replace the OM with someone who IS trusted. There is no middle of the road, where the owner doesn’t really trust the OM and so is always nosing around and watching, etc to see if it’s done right. This defeats the purpose of having an office manager in the first place, as described above.

The process is to decide which duties are to be done by the OM, delegate these duties, then back off and let the OM do the duties with no interference.

Note: “No interference” does NOT mean that there would be NO supervision or oversight. Abandoning all oversight is the reverse swing of the pendulum to micromanaging.

Certainly duties can be delegated to the OM on a gradient scale, giving some duties and observing if the OM can correctly accomplish them before delegating more duties to the OM. This gives the new OM a chance to learn and provides the owner with a chance to gradually build trust with the OM.

Roles and duties

If we take as an example a medical type of office we will have the doctor being the owner of the business. The owner/doctor then has two very separate hats or jobs, one is owner and one is doctor. These two jobs must be kept completely separate as to time and schedule.

Based on any simple Organizing Structure the owner of the business sits at the top of the command chart. We could say the owner is the CEO, or President or what ever, but they are at the very top of responsibility and oversight. Next as we move down the organizing scheme, we would have the manager. The manager is answerable only to the owner and carries out the duties assigned by the owner.

ALL other employees would then fall under the control of the manager. It is the manager who has the duty to oversee the performance of all employees.

Interestingly this means that the manager also over sees and manages the work of all doctors, including the owner.

This can make for some interesting issues, if the owner of the business also has some sort of production post in the business then he or she MUST submit to the edicts of the manager, even though as the owner he/she can fire the manager.

An example of this being done wrong would be where the OM has issued an order regarding use of estimates before work is commenced. The owner/practitioner may decide that because he or she is the owner that they can do what ever they like and not follow the rules issued by the OM. In this case the owner makes verbal price agreements with clients, in violation of the edict laid out by the OM. This sort of behavior from the owner tends to negate the authority of the OM in the minds of other employees, creates internal strife and while common, is destructive to the business in general and to the OM/Owner relationship specifically.

This situation necessitates that the person who is both owner AND practitioner behaves in a very exact fashion. This includes setting up specific times to meet with the manager to discuss strategies, plans programs and the like.

This situation allows the doctor the most freedom to simply be a doctor and not be concerned with any of the day to day issues of the business. ALL staff issues would be handled by the manger. This is a wonderful idea from the view of the owner in that he/she can be aloof from any conflicts and be seen as the benign monarch and the hard decisions and dealings with staff would be handled by the manager alone.


If an office manager has been given the duty of hiring or advertising and has been entrusted FULLY to deal with these duties than a major error would be for the OM to constantly go back and ask the owner for advice. If for example the owner has given complete control to the manager on staff discipline and the manager decides to fire an employee the manager would NOT go back and ask the owner what he/she thought about firing so and so. The manager would simply fire the employee and let the owner know it was done. The same would apply to marketing. If the decision has been granted to the manager to make, then they would need to make it (and inform the owner of its having been made), but NEVER to pull the owner into the decision making process. If the manager violates this rule the result will be the owner being pulled into making management decisions more and more, while NOT doing the duties of being a doctor, to the detriment of all.

The owner also can make errors by delegating duties to an employee and then micromanaging the execution of these duties.

Purity of Communication Lines

Both owner and manager MUST be very disciplined regarding their communication in the business. If either party has any disagreements about how things are done these comments would always be done in private and directly to the other party. NEVER make any comments of discord to any other employee as they relate to each other. Just as the manager would NEVER make a negative comment to the receptionist concerning the quality of the medical work performed by the doctor, the doctor/owner would NEVER make any critical or derogatory comment concerning the manager to anyone other then the OM and only in a person to person / face to face meeting.

Regular owner/OM meetings

In any owner/manager relationship the most common source of conflict (second only to no agreed upon list of duties) is always a lack of communication. A regular and strong communication line ensures that the parties know what is going on, what has been accomplished and what the plans for the near future are. Not having a smooth and regular communication line between owner and manager will create havoc very quickly.

Ideally the owner/manager meeting would occur once a week. A specific day and time should be scheduled and kept at the same time each and every week. The meeting need not be long, no more than 30 to 60 minutes but it MUST be held and held weekly. This time slot should be cleared on the schedule and the staff briefed that this time is sacrosanct and NOT to be taken away.

The manager must create a battle plan (to do list). The Battleplan (BP) would include all of the actions that the manager plans to accomplish in the near future. The BP would be separated into sections, such as

  • Advertising/Marketing
  • Building/Equipment
  • Computers
  • Finance (Billing, A/R, etc)
  • Personnel
  • Staff meetings
  • Education
  • Staff training

The BP can be created by the OM alone, or with the assistance of the Owner. In any case, an assessment of what needs to be done and any future plans are envisioned and written up in the BP.

In the weekly OM/Owner meeting the OM would first go through the tasks which were accomplished from the last week, for example, that all of the client statements were sent out on Wednesday, or that the new technician started to work, or what ever was done. The report of what has been accomplished is important as the owner, being busy with production, is often not aware of the tasks which were completed during the week.

The owner can ask about the reports of what was done to gain clarification as needed.

Next the OM would the read out loud and discuss the BP for the upcoming week. Again, the owner would be listening and add suggestions here or there, as needed/requested.

Ideally the owner would be impressed with what was done last week and equally impressed with the plans for the new week and simply say; “Great and your plan sounds wonderful!”

Of course the owner may want to discuss the upcoming weeks plan, add to it or modify the targets set by the OM.

During this meeting if the manager needs to ask the owner for approval for a specific project, then this is the time to do it. Discussion of other employees, marketing, all of these issues would be discussed during this meeting.

Timeliness of Communication

Both the owner and office manager must be well disciplined as to the speed of their communication to and from each other. If for example the OM has put together a proposed new Yellow Page ad and needs the owner’s approval by a certain date, then the owner must be certain to respond by the deadline agreed to. Reversely, if the OM has been given a task to compile certain financial reports by a certain date, then these must be done on time and returned to the owner with out the owner having to chase down the OM for the reports.

Accurate financial reports

Financial reports form one of the pillars of the Owner/OM relationship. These reports show the overall health of the business, whether the business is expanding or contracting, the state of expenses, areas of income generation and more.

The accuracy of these reports is therefore paramount.

Each industry or type of business has different details which a complete financial report should include, and creating the ideal reporting system can be researched or developed. But several keys hold true no matter what the type of business is in question.

First, the categories of income and expenses should be scrutinized thoroughly to ensure that the correct numbers go into the correct category. In many small businesses expenses are NOT categorized correctly. Care must be taken to ensure this is correct as otherwise the numbers on the Profit and loss statements become meaningless.

Often the financial reports are some on a generic quick-books basis and the income/expenditures are vaguely understood and not monitored.

Each months report should show the current month’s numbers and percentage of sales, as well as the YTD totals and percentage of sales as well.

These reports would be scrutinized each month and discrepancies taken up and handled.

It is vital that the owner spend time each month reviewing the financial records as above as this, if not done, opens the door for lots of bad surprises, like money missing etc.

The OM would also review these reports to see where the expenses are at, looking for methods to reduce them and also looking at income sources, seeing the trends and working to strengthen the up-trending statistics.

A bonus system or compensation questions for the OM or any employees would then be determined, in part at least, by the number reflected on the profit and loss statement.

Regular staff meetings

One last important component of the Owner/OM relationship is staff meetings. Staff meetings should be held regularly, ideally once a week. The staff meetings are to done completely separately from the Owner/OM meeting.

In the staff meeting the OM would be the one running the meeting. The OM would review the business statistics, review policy or procedure, read the entries from the customer comment log and brief the staff on any news about the business. The owner may add any comments he/she wishes, but defers to the OM in these meetings.

During the weekly staff meetings the owner/practitioner is emphatically wearing his/her hat as practitioner, NOT owner.

If the owner has any specific things that he/she would like covered in the weekly staff meeting, then this would be discussed at the weekly Owner/OM meeting before the staff meeting.

The above points, while not covering every possible angle of Owner/Office Manager interaction, provide a strong foundation for getting started and creating a mutually beneficial relationship.


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