What does a business owner need to know about organizational structure to generate revenue?

It is important for any entrepreneur to realize that running a business and managing it are not the same thing. It is not uncommon to see situations where a promising business fails because of ineffective management. If under the conduct of business means the choice of strategies and tactics, determining the direction of development, analyzing markets, making deals and finding investors, then management is an administrative and systematic activity aimed at ensuring the stable operation of the enterprise.

When a business owner does not have enough time or desire to deal with all these tasks, it is worth hiring a manager capable of creating and maintaining a clear management structure. Such a specialist will build a system that ensures the smooth functioning of the company and constant control of its activities.

 

Where to start?

 

What is this system? It implies a clear definition and distribution of rights, duties and responsibilities at all levels of the organization, as well as regular monitoring of compliance with these rules. However, many companies underestimate the importance of such structures. Creating a clear organizational chart is one of the key steps to successful management, because without it it is impossible to achieve a transparent distribution of tasks and powers, which inevitably reduces the efficiency of the entire enterprise.

It is important to clearly define who does what, who reports to whom and for what is responsible. When one issue is solved by several departments at once, and another remains unattended, the efficiency decreases. To avoid such situations, for each division it is necessary to develop regulations describing the scope of duties, rights, subordination and responsibility. For all positions, job descriptions are created, which are prepared by the head of the department, and in some cases - the department of personnel or labor and wages. After coordination with the legal department, these instructions are approved by the head of the company, and employees are familiarized with them under signature.

Some may consider this to be unnecessary bureaucracy, but the one-time creation of these documents avoids many issues and problems in the future. Important in the work of a company is not only how tasks are distributed, but also how they are performed - by a collective or a team. A team consists of specialists who perform their assigned duties and are only responsible for their part of the work. A team, on the other hand, is united by a common goal, works cohesively and is focused on the end result. Therefore, the manager should not only perform his direct functions, but also create conditions for teamwork, maintain a positive psychological climate and promptly respond to emergency situations. This approach contributes to the improvement of production results.

 

What does the effectiveness of any team depend on?

 

The effectiveness of management also directly depends on the remuneration system, which should be fair and uniform for the entire enterprise, taking into account the qualifications, degree of responsibility and workload. Highly skilled labor that requires considerable training should be paid higher than unskilled work. This affects the atmosphere in the team and, if properly organized, contributes to improved performance.

In order to effectively organize the performance of tasks related to the creation of a new division, launching new products, inventory, preparation for inspection and other important processes, it is necessary to appoint a responsible person who will control the implementation of the relevant order. All participants specified in the document must familiarize themselves with its content under signature. At the end of the established period, the results of implementation are necessarily summarized, which allows you to assess the success of the event and identify any deviations.

This approach helps to determine in a timely manner which employees or departments should be involved in the fulfillment of a particular task. It is not uncommon to discover unforeseen factors that were not taken into account at the decision-making stage but have a significant impact on the final result. For example, if it is decided to engage in a new type of activity, but this issue has not been coordinated with lawyers or economists, difficulties may arise. In the process of work it turns out that this activity requires a special permit or license, and the tax regime will be different from the intended one. As a result, the results may be very different from those expected.

 

How to make the team coherent and reliable like a Swiss watch?

 

To avoid such situations, it is important to discuss all aspects in advance with specialized specialists at a meeting. This makes it possible to take into account relevant circumstances and reduce risks. Meetings also facilitate the exchange of information between middle management and other departments, which increases management efficiency.

Brainstorming is another effective method, especially when urgent issues need to be resolved quickly. In the process of collective discussion, as they say, the truth is born, but it requires creative, thinking specialists and support of team spirit.

The team works smoothly when the system is established not only at the level of the whole enterprise, but also for each division separately. It is important to establish a clear sequence of actions, list of tasks, responsibility of employees, forms of reporting, volume of information and deadlines for providing data. Let's consider a simple example: for effective management the manager needs daily information about product balances in warehouses.

The system should work in the following way: the storekeeper submits documents on the movement of products for the previous day to the accounting department before nine o'clock in the morning. The accountant enters this data into the system by ten o'clock, and the economist analyzes the information by eleven o'clock and includes it in the daily report for the manager. If warehouse accounting is automated, the system can be configured differently, but there must always be clear deadlines for filing documents, responsibility for the accuracy and completeness of the data, and proper control.

Only under these conditions can the manager confidently rely on the information provided. An effective management system allows to maintain teamwork and control all processes, which ensures the successful functioning of the business.