The structure of a business is key; everything radiates out from there. As businesses grow over time, it’s common for the structure to become out of date and lack relevance to changing needs.
As you return from your summer holidays, it is a good opportunity to set your goals for the year, set your operational and capital budgets and take the time to review the structure.
Ask yourself “is your business structure still fit for purpose?”.
As your business grows and your team expands, you may decide to introduce extra levels into the organisational structure.
The more autonomous your team is, the flatter the structure can be.
Try and keep the structure clean and uncluttered, wherever possible.
Try to avoid situations where staff are reporting to two people; this can lead to conflict, confusion and a lack of accountability.
If you don’t already have an organisational chart, it is simply a diagram showing each position, the name of the team member currently holding the position and the reporting lines throughout the business.
Keep your organisational chart up to date – it might seem insignificant to you as a business owner, but it’s important that everyone has a sense of belonging to the team and an understanding of where they fit into the business, including who they report to and the staff they are responsible for.
There is a tendency for small businesses in New Zealand to build a role around a person. Let’s just say a particular person has a unique skill set and it is in your interests to utilise that person to your advantage.
You create a role that is specific to that person. Examples would be:
- An engineer who has studied law
- A builder who has previously worked as a welder/fabricator
- An IT expert who has run their own recruitment business
- An HR expert who had years of experience working in banks
- A warehouse employee who also has experience in designing electronic inventory systems
- A chef who just happens to have a marketing degree
Their unique skill set and experience will provide you with benefits but also creates a level of risk within your business.
You need to acknowledge that when that person leaves you may end up with an unusual type of position to recruit to.
There is no easy way around this, especially for a small business where a jack-of-all-trades approach is very handy.
Also, Kiwis, more than anyone, are happy to work ‘outside the box’.
By reviewing the structure and roles within your business, at least on an annual basis, this allows you to identify risk around these types of roles.
You may flag them and decide to split or modify when the opportunity rises, creating roles that are more generic and easier to recruit to. Try to develop a strategy around what you’ll do when a “unique” team member leaves. You may be able to:
- Recruit to the key portion of the role
- Move part of the role onto another team member
- Contract out part of the role (which may be smaller or specialised – for instance, IT or
If you do change the structure of your business post-holiday, be sure to communicate this to your team. Of course, you will know what you are doing but let the team know what your intentions are!