A business is a coming together of several functions, operations, activities, skills and resources to achieve certain desired goals and objectives. If all these functions and resources of a business are not sorted, arranged and placed in a systematic order, it can lead to difficulties in managing of the business. A good business is a strong organization of what keeps it up and running; what it exists for; and what it strives to accomplish. Small business startups have a vantage point here as it can seed the roots of a strong organization from its infancy.
1. Design a well defined and suitable organization structure
The first step towards organizing a business is departmentation or division of work. In departmentation, business is divided into manageable clusters. Some of the most common forms of departmentation are –
– Functional departmentation
– Geographical departmentation
– Product / Service departmentation
– Process departmentation
However, in practical business operations, a company may adopt multiple forms of departmentation according to their own operational suitability and managing convenience. For example, a financial institution may adopt an organization structure having both geographical as well as functional departmentation. In such an organization structure, the staff functions of all the operational territories are supervised centrally while the respective line functions are managed by individual territories.
2. Identify the processes
Each of the business divisions plays a strategic or a functional role which contributes to or facilitates in the achievement of business goals and objectives. To play this role effectively and efficiently, each division has to carry out certain processes. For example, a marketing division has to manage several processes like customer care, marketing research, sales and business development etc. These processes can be further defined in terms of operations and activities. Having processes help a business focus on all the important areas of a division.
3. Staffing decision
Too much of work load, lack of command, inadequate authority and lack of accountability and responsibility can easily create chaos and disorder in business operations. Presence of these elements indicates violation of some of the basic principles of management and such violations are bound to create problems in staff management. For example, according to the principle of unity of command, one staff should be answerable to only one authority. For example, if a staff has more than one reporting authority and the areas of authority are not defined, a staff would never know which authority he should take orders from or whom he should report to.
Another important consideration in staffing decision is the span of control. Even with modern day tools and technologies, every manager has a limit to how many subordinates he can handle. When this limit is crossed, the concerned manager will not be able to effectively monitor and supervise the performance of his subordinates and things may start appearing as unmanageable and unorganized for the manager.
Small business startups often expand rapidly in terms of adding new employees which makes it essential that the owners maintain the work-subordinate-superior ratio while engaging in fresh recruitment.
4. Focus on organization culture
Organization culture has a strong impact on performance, employee morale and image of a business enterprise. A strong, positive and professional organization culture is home to productivity, innovation and excellence. A poor organization culture breeds unhealthy internal competition, inefficient team performances, low employee motivation and morale, high employee turnover, absenteeism and so on. In such a negative built-up, it is always difficult for the business owners to bring the teams together and stand as one organized unit. Small business startups should take utmost care and efforts in building a strong and professional organization culture from the very beginning.
5. Implement SOPs
SOPs (standard operating procedures) are one of the most professional tools of organizing a business. By having well defined operational procedures, managers can easily keep track of their functional activities. Also, SOPs help a business adhere to standards of performance. SOPs serve as a guiding map for employees to execute their routine duties and responsibilities with ease and accuracy. In short, SOPs help entrepreneurs and managers exercise better control over the root level operational activities.
Technology has reduced the requirement of human effort in business operations to a great extent. And one such technology which has changed the face of internal business operations is the ERP. Massive, complicated and functionally-integrated data management is now possible with ERPs. Business decision-making can get really complicated and fussy when multiple processes need to intertwine with one another giving rise to the need for timely and relevant data for process owners. ERPs address this issue and makes business operations convenient and manageable.
YRC Related Articles: How to Write SOPs for Marketing?, 6 Ways To Grow Your Business, How to Start a Retail Business in India, Business Expansion Plan for Small Entrepreneurs, Six Steps to Writing a Great SOP for Retail, How to write SOPs for an Apparel Brand?, How to Develop SOPs for Quick Service Restaurant?, How to write SOPs for Furniture Showroom
Chief Strategy Officer