An organization's organizational structure is the relationship between different roles within the company. In the structure, you can see how the roles are interconnected and what level of responsibility each role entails. In addition, it reveals the organization's hierarchy of roles. Your small business's structure can help you stay organized during the start-up phase and beyond by helping you visualize it.
A great business idea and a great team are at your disposal. Your company is growing, and it's time to put some structures in place to help you keep track of everything. If you want your startup to succeed, you need a more innovative organizational structure that can adapt.
An organizational structure is a visual representation of what employees do, who they report to, and how business decisions are made. It is possible to create organizational structures that are tailored to the needs of specific businesses and industries based on functions, markets, products, geographies, or processes. It's also important to be aware of any potential stumbling blocks before you begin to scale.
Transparency, traceability, and repeatability of work must be ensured. Work must be delegated and owned. If something goes wrong, you need to know who's responsible and what went wrong, as well as how to fix the problem. Process management is the most common tool used by most organizations. When it comes to information flow as well as the interaction between business and human worker processes, work management is a set of software products and services that apply workflow structure.
You can transform and streamline critical business processes with the help of good work culture and better work management.
Assembling Your System
Small businesses often have a very simple structure when they first start up and for a long time afterward, as well. As a small business, you don't have to deal with the complex structural decisions that large corporations have to make.
You are likely the owner and manager of your company, with employees reporting to you. With one or more partners, the top of the pyramid could be made up of all the partners (including you), then managers (including you), and finally employees.
Roles in the Evolution
When starting a new business, the owner often finds that he can't effectively handle all of the managerial responsibilities. Financial and marketing managers will be replaced by hard-working employees.
Owners and managers can focus on larger goals by delegating managerial responsibilities. Over time, employees become more skilled and knowledgeable in their respective roles, increasing the efficiency of the company as a whole.
Focus on your core competencies
Make sure you focus on your core competencies and outsource the rest of your work. In the past, organizations have diverted large amounts of money from core products to servers, software development, platforms, and hardware. These days, it's very likely that you can outsource these tasks and get better results than if you did them yourself.
Core competencies are the resources and capabilities that comprise the strategic advantages of a business. A modern management theory argues that a business must define, cultivate, and exploit its core competencies in order to succeed against the competition.
Software companies tend to use Agile. Whatever you choose, make sure that team management is in place, with the necessary structure, processes, and tools. Teams are almost non-existent in early startups, but they quickly become essential for basic functionality such as transparency, role and responsibility delegation, and asset management. The following are some of the benefits of working with a team: This approach to leadership views a team as an organisational group made up of individuals who work together to accomplish goals. A team is made up of individuals who are interdependent, work towards interchangeable goals, and share common goals. An entire team works together to accomplish a goal.
For organizations, Holacracy divides the structure into nested circles. For example, in a holacracy, members of an organization or team work together to accomplish tasks and achieve company goals in separate, autonomous teams. Hierarchy in the workplace is replaced by a flat organizational structure that gives each employee a say in the company's direction. Because it is so well-structured, there is very little room for ambiguity about who is responsible for what in this system.
Because people are not hired solely for a specific job, they can take on one or more roles at any given time, and they have the flexibility to move between teams and roles if they have skills or insights that the organisation could benefit from at any given time.
This replaces the autocratic power usually exercised by company owners.
It is based on seven guiding principles that help to shape the culture of organizations. Considering that all of Sociocracy 3.0's patterns incorporate the seven principles, understanding them is essential to adopting and adapting the patterns. Use your time wisely by focusing on activities that will help you achieve your goals.
- Use the principle of effectiveness to spend your time only on activities that will help you reach your goals.
- Invoke the principle of consent when making decisions or taking actions.
- All assumptions should be tested through experiments and revisions.
- The principle of continuous improvement is to make incremental changes to accommodate empirical learning over a long period of time.
- It is important to involve people in the decision-making process.
- Unless there is a reason for confidentiality, all information that is valuable to the organization should be recorded and made available to everyone.
In order to be accountable, one must respond when something is needed, follow through on what they agreed to do, and take responsibility for the organization's success.
Command and Control
To delegate tasks and approve work, you must have a chain of command (or command structure). If you have an org structure, you can specify how many "rungs of the ladder" a certain department or business line should have.
Almost all companies have a hierarchy in place that identifies which individuals are responsible for which people, teams, or departments within the company. The chain of command allows each employee to know who is in charge of them and what their responsibilities are.
The term centralization refers to the final decision-making location. Your chain of command will need to be set up after that, and you'll need to decide who has a say in each decision. Unified or decentralized decision-making is possible in a business.
If you don't have an organizational chart right away, it will become increasingly difficult to run your company without it as you add more products and hire more employees.
This was a list of some approaches to organizational structure in an organization. You can also create your own organizational structure which you think fits your company the best.
It's time for your startup to adopt a more innovative organizational structure that forces everyone to think.
How do you structure a startup?
Here are the things to consider while structuring a startup:
- Defining and establishing the leadership
- Architecting the structure
- Building your team
- Bring in the professionals
- Communicate with the board members
What is a legal structure?
An organization's legal structure is a key determinative of the activities that a company or a startup can undertake. It Includes:
- Raising capital
- Responsibility for obligations of the business
- Amount of taxes that the organization owes to tax agencies