HTG: VARs Need To Better Develop Leaders From Within

Solution providers have built successful IT practices, but they haven't developed the people within their own organizations, a key factor to both their growth and long term survival, said executives at Heartland Tech Groups, which is hosting its annual HTG Summit in Dallas this week.

For that reason, much of the content at this week's HTG Summit in Dallas is around leadership succession for VARs that haven't put much thought into that area, said Arlin Sorensen, CEO of Heartland Tech Groups.

"Most partners haven't had any real strategy to grow themselves. They haven't invested in growing their people. They need to identify who has the capability to lead within their company, how to invest in them and what kinds of disciplines you need to build yourself to become a good leader," Sorensen said.

Related: CRN 30th Anniversary: Where Are They Now?

Over the last several years, HTG has made its mark as a peer-to-peer organization for VARs helping other VARs by giving each other guidance and support. But many times, VARs haven't realized they also need help, Sorensen said. Among the skills HTG emphasized to members this week are identifying potential leaders in an organization and taking steps to increase the management skills of those people.

If a company is to grow, the principals need to rely more on their underlings to achieve that growth, Sorensen said. However, some VARs also might find that they don't have anyone on staff that they're comfortable with promoting to a leadership role, forcing them to face even more difficult choices, he said.

"In a lot of cases, the CEO has never thought about it. Their typical growth pattern is to hire a few engineers but then you need someone to manage them. They try to do it themselves, but when you get to a certain point, you can't do that and then they don't hire the right kind of person. They promote an engineer to become the service manager, which is a total disaster," Sorensen said. "There's a gap on both sides, in sales and service, where they need to start thinking about who sits in that [management] chair and how would I replace myself in those roles."

It also can be difficult for VARs to add, hire or promote layers of management personnel that are non-billable resources. But, if VARs want to continue to grow, it has to be done, Sorensen said.

"At a point, it's do I want to grow the business or don't I? My father taught me 'investment precedes return.' You have to make some investment. That's one of the things we're working on," he said.

Next: Bringing Spouses Up To Speed

One of HTG's technology partners, ConnectWise, has a great utilization tool that helps VARs determine if it's time to add a manager or another engineer, HTG's Sorensen said. "If you have three or four guys that are billable, it won't be long before you lose production because there's nobody managing them. It's the same on the sales side," he said. "Financing is always the issue. Adding non-productive people is always a problem, but it's also the only way you can grow. That's the decision point: grow or not."

Slowly, HTG VARs have become more receptive to leadership planning, said Scott Scrogin, president of HTG. More than 100 people participated in HTG's Leadership Forum this quarter. "People vote with their feet and their dollars. That spoke volumes," he said. Becoming a better leader, and adding leaders, is a journey not a destination, Scrogin said. "I draw a parallel with losing weight or whatever you might be trying to change. It's a collection of small steps rather than one big change," he said.

To expand that strategy, HTG plans to hold service and sales leadership training summits in August and September, sessions in which CEOs and principals won't be allowed.

In another effort to increase people power, HTG offered an educational track for the spouses of VAR executives, sessions which sought to help spouses understand everything from financial statements to business valuations in relation to "Being Married to an Entrepreneur." About two dozen spouses attended the track this year, offered for the first time, Sorensen said.

"What we find is our members don't communicate well at home. They come to HTG three or four days a quarter and the wife has no idea what's going on. They just know they don't have any money they can spend because the husband is pouring it all into the business because they need to grow," Sorensen said. "We're looking to create a level of understanding and debunk some of the myths so people have a little more harmony at home," he said. HTG also offers a full-day couples retreat after the conference to build communication skills. More than 25 couples have signed up, Sorensen said.