It’s not overly dramatic to suggest that a small business can fail without an organizational structure. Without structure, tasks can fall through the cracks, employees lack accountability, and rewards for hard work simply don’t happen. Here are the hows and whys of starting a small business with a clear structure in place.
Why You Need Structure — Even in a Start-Up
If you’re launching a small business, setting up an organizational structure may be the last thing you’re worried about creating. There are so many little details that it might be challenging to consider an internal system to measure activities and develop rewards for employees. But you should. Having a written organizational structure can boost your efficiency and improve communication. It’s particularly important if you have employees that you’d like to hold accountable but also reward for good work.
How To Create Organizational Structure in Your Small Business
There are three primary functions to almost any business. They include:
- Marketing and sales
- Operations and product delivery
- Administration and finance
Start your organizational roadmap with a chart that shows these functions. If your business is a sole proprietorship, this is going to be a quick exercise! Under each function, what roles fulfill those duties? For example:
- Marketing and sales can include everything from lead generation to creating marketing documents, networking, account management, PR, and social media.
- Operations and the product delivery are the production arm of the business that can include fulfillment, product development, and customer service.
- Administration and finance are the nuts and bolts of the business, encompassing HR, IT, and accounting.
For each of these positions, write down the title of the role, who fulfills these roles, and daily tasks. You’ll end up with a job description to inform your business structure. Generally, in a small business, the leadership will also do double duty in some or all of these roles.
It’s a good idea, as you flesh out this structure, to give each department one person that has the final say in decision-making. This ultimately could be the owner of the business, but, to avoid gridlock, later on, make sure you establish who is the “decider.”
Create reporting relationships between all of these roles, even if your company is small, and it feels as if this exercise is overkill for your size. Over time, you will turn again and again to this structure, as employees need guidance and support.
All of the workflows that keep your business running lie within each of these job titles and reporting structures. While you may not have time to map out these workflows as your business gets started, it’s always a good idea to write down processes as they get worked out.
Small businesses can launch without an organizational structure in place. But, as time progresses, the firm brings in more business and more employees get hired, your lack of organizational structure will harm the company.
Partner With Exelare!
If you’re growing, it’s time to start a partnership with Exelare. Talk to our team today about how our software can help your business get organized, or schedule a demo!