Developing Your Organisational Structure
If you’re in charge of running a growing SME then there’s every chance you’ve been in that position ever since start up, and that the structure of the SME, as it grows and expands, is something which has developed in a rather piecemeal manner. To a large degree, this is only to be expected, since the day to day business of running an SME tends to eat up so much of the average bosses time that it becomes increasingly difficult to take a step back and employ an overview of the company. Whilst it’s vital that the people in charge have a firm grasp of exactly what transpires at the ‘coal face’, in terms of helping to shape the processes of the company in order to assure maximum efficiency, it’s equally important to have a firm grasp of precisely how the larger frameworks of the business are operating, and whether the organisational structure which you’ve arrived at is the one you’d opt for if you were creating it, from scratch, for an SME of your size.
Put It On Paper
Sitting and ruminating on fairly vague concepts around the structure of your business, something which takes in every strata of management and staff and every operation carried out, can seem fairly overwhelming, with the sheer accumulation of detail making it hard to make a judgement on how the different parts, and people, in your SME interact with each other. That’s why it’s always useful to set the structure down on paper, via a fairly simple diagram, in the first instance, demonstrating who does what, at what level of the business, and how they communicate and liaise with the departments above, below and around them.
Division Of Labour
One of the chief advantages of setting everything down on paper in this manner is that you might realise just how much of the responsibility for running the business you’re taking on your own shoulders. Not only are you the CEO, but, according to the diagram you’ve drawn up, you’re also the Finance Director, the Sales Director and the Sales Manager. In the beginning, when the business amounted to little more than you, your computer and a telephone, this was a natural state of affairs, but now that you’re growing the business, an overly heavy personal workload will stop you growing it as effectively as you could. On top of this, there is the question of work/life balance. You may fully accept the idea that running an SME is a full time job, but there has to come a point at which you question why you’re working, if it’s only in order to facilitate yet more working. Setting down, examining and restructuring the organisation of your SME will allow you to identify those aspects of your current workload that you could readily delegate to others.
The question of delegation will boil down to a choice between delegating to an existing member of your business and taking on new people. If you honestly can’t find anyone within your business that could step up to one of your roles, or expand their own portfolio, then it may well be time to take a look at your recruitment policy. When recruiting you should be looking at not just what the applicants can do, but what else they can do, and what they have the potential to move on to doing in the future. A careful consideration of your organisational structure will embed this kind of thinking as a natural instinct.
One of the advantages which SMEs enjoy over larger corporate competitors is the ability to react quickly to changes in the working environment and respond flexibly. If your organisation has grown organically, in an overly complex manner, then you’ll be throwing this advantage away. If one person has to consult with four or five other people, and this consultation has to be passed up and down the chain of command to other groups of people, then the decision making process will grind, if not to a total halt, at least to something much less dynamic than it should be. When organising the hierarchy of your business, set it up in such a manner that each person has one clearly defined person to report to, setting up a simple and easily negotiated chain of command to the very top. Not only will this simplify decision making, but it will ensure that each member of staff knows precisely where they fit in within the business, and exactly what their own individual goals and responsibilities are.
When establishing or revamping your structure, you should ensure that all members of staff feel involved throughout, providing input and offering opinions. Not only will this guarantee a degree of ‘buy-in’ to the finished result, but it will also provide invaluable insight from levels below that of management. The organisation finally arrived at should then be set down and published, creating a framework to review if problems arise, and a template for moving forward when your business grows again.
You can read more posts within our business growth series here.