The first thing that we need to look at is structure. First up we need to look at the organizational structure of business.
We need to create very clear, well-defined lines of accountability in the business, because without accountability you have nothing. Without accountability, without single points of responsibility ( to clarify this is not about blame), it’s about having responsibility and nurturing extreme ownership in everything that you do as a business leader. It’s also so that in everything your team do, in everything that your staff do, giving them complete and total ownership of their roles, so they know exactly where they stand in the organizational structure.
It’s about building a structure, or an organizational chart that is going to be a lot bigger than perhaps you need it to be, at a mid six-figure level business, or even a low seven-figure level business. You are going to have multiple different roles on the chart where you’re actually going to have the same name in multiple boxes, and that’s absolutely fine.
The best way to approach the structure element is to get an organizational chart template. If you’re in my program you’ve had my template. When we work together that’s something that’s available and there for you. Now you can rearrange the boxes, delete and add as necessary to give you a structure that best represents and best serves your business.
The best piece of advice we can give you in doing that is to completely forget about all the existing roles. To completely forget about all the existing people in your business. Put the names completely out of your head. Now think about what roles, if you were starting from scratch, with your six or seven figure business, if you didn’t have any employees and you could just pick off a tree the perfect staff members, in the perfect roles, to give you the best results in your business, what roles would exist in your business?
For most businesses that’s going to be pretty much the same. Contractors and construction firms, M&E, contractors, you’re gonna have draftsman, you’re gonna have M&, engineers, you’re going to have joiners, you’re gonna have trade operatives. But generally speaking at the higher levels, you’re gonna have the same sorts of things.
The way I like to think about this is in four different levels. When we’re talking about structure, we have;
Level 1 – which is the board.
The board being the board of directors (not a plywood board, right?)
Down from there we have level 2 – this is the executive director team.
The main difference between these two levels is these are your non-executive directors, these are your shareholders. These are people who are not operationally active in the business, who are planning strategy and devising tactics at a very high level, and then feeding that information down into the rest of the business to execute. Then the information feeds back up, ultimately to level 1 so that they can adjust that strategy, adjust the techniques to get the best results. Level 2, your executive director team is the managing director, it’s your operations director, your sales director, a finance director etc. These are the high-level directors in the business who are operationally active in the business day to day.
Next you have level three. – This is your manager level.
This is all the managers and the teams that report directly to the executive director team, who in turn report directly to the Board of Directors.
At the fourth and final level is your operatives.
In thinking about your organizational structure, this is how I recommend you think about and how you lay it out;
All of the operatives report to a manager in their given department.
All of the managers report to their respective exec directors,
All of the exec directors ultimately report to the managing director,
The managing director then reports to the board of directors.
In some cases, levels one and two will be the same. You’ll have executive directors sitting on the board of directors, and this really depends on the size of your business. However, this is how to think about structure.
Once we define the structure of our business, what we then need to do, before we’ve even put any names in any of the boxes, (so forget the people who are in the business), is just about defining the ideal structure with the ideal roles for your business to get the best results.