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Organizational Design

10 Best Business Operations Practices for Startups

This article was originally published on LinkedIn

Starting a business and hiring your first few employees can seem daunting. Without having a solid foundation, your efforts at managing finances, human resources, marketing, office locations, clients and stakeholders, can quickly become overwhelming. This may compromise a business’ chances of success.

However, following these proven strategies that ensure smooth operations’ practices will position your company for success.

1. Define Who You Are

Have a clear, well-construed message to your growing team, your current and potential clients, and to yourself. What makes your product or service unique? What do you offer that your competitors do not? What does your company want to be when it grows up? Answering these questions will help you understand your competitive advantage and will aid you in securing and retaining top talent. People want to work for leaders with vision, and if you can’t sell the business ideas to your potential employees, how are you going to fare with your clients?

2. Build a Strong Foundation

Clearly define all processes and departments, even if you don’t yet have staff to fill all of the roles. The most fundamental departments every startup should have are Administration, Marketing & Sales, Human Resources, and Accounting & Finance. These will become your sustainable foundation, allowing your company to scale up and maintain its manageability. You do not need to wait for a team to build your departments. I once set up these four basic departments with independent protocols and defined guidelines, despite having a team of just one!

3. Pick the Right Players

The biggest asset you will ever have in any startup is your people, so you must choose your team strategically. This is easier said than done, especially as you try to balance hiring enough people to provide the services that will keep your business afloat with onboarding the profit generators and the support staff that manage the actual business. It can be difficult to retain your star players when your company is growing and you don’t yet have much to offer in perks and benefits. Your clear vision of where you want your company to be in the future can inspire your employees to make them want to be a part of something bigger. Together, you can achieve the results you have envisioned.

4. Manage Your Team Expectations

Having determined your vision of the company’s future and established a sustainable foundation, you need to manage your team’s expectations. Doing so is an ongoing project that requires a clear line of internal communication explaining where the company is, where you want it to go, and how everyone’s contributions will help the company get there. Transparency is paramount, lest you risk losing valuable resources if they feel trust has been broken.

5. Keep Records of Everything

Document all of your processes and archive every document, email, memo, and receipt. Since cloud storage is incredibly affordable these days, take full advantage of it and maintain impeccable records. Pay special attention to your bookkeeping; your accountant will thank you later. The better you keep track of your records, the better your business analytics will be.

6. Manage Your Cash Flow Wisely

Bookkeeping should be a priority, both for the sake of record-keeping as well as a gateway for evaluating your company’s health. Watch your business spending and audit often. Although you cannot fully control the stability of your business income stream, you do have a much bigger control on its spending. Of course, an idea that becomes a business must be fueled by passion. Just don’t forget that actually running a business means you will also need a steady positive cash flow.

7. Automate Your Finances

There are plenty of options for every industry and company size, so there is no need to waste time manually creating invoices, chasing late payments, or processing payroll. Find a solution that works for your business model and remember that the small financial commitment you are dedicating for these services will actually yield anther commodity you might not have enough of: time.

8. Know Your Audience

In a competitive market, it is not enough to simply have a good product. You must also excel in customer service. Great customer service is first and foremost a combination of good communication and adaptability; every client is different and you must be able to meet their unique demands and speak their language while maintaining your company’s standards of quality.

9. Serve Quality

When you make products people want to buy, marketing is secondary. If your product quality leaves much to be desired, no amount of marketing will salvage it. Mistakes happen, and whether you sell a product or a service, addressing mistakes by thoroughly analyzing what went wrong and working to amend it will yield results and improve quality. Your team can use mistakes, and the efforts to correct them, as learning opportunities to fuel growth.

10. Invest in Your Company’s Future

Oftentimes, it becomes tempting to cash in on profits, rather than reinvest in your company growth. You must resist this urge in favor of your company’s future. Take a cue from successful companies like Amazon, whose revenue keeps rising while net profit stays incredibly low. While not every company is going to be the next Amazon, the lesson is the same. Invest in your own growth and plan for the future.

Organizational Design

Organization Design: 5 Must-Read Articles to Transform your Business

Clearly, organization design plays a key role in the success of any company – but it goes well beyond some geometric shapes on a page in an employee handbook. There are endless opinions on what is best, but we can generally agree that effective and strategic management of organization design is far more than the traditional adjustment of those lines and boxes and is critical to staying ahead and remaining competitive – no matter what might get thrown your way.

Below, I have suggested 5 articles to give you a good understanding of what strategic, intentional organization design is (and what it isn’t), along with critical fundamentals and practical application tools on getting it right the first time that are universal to most companies regardless of size, demographics or current structure.

Organization design: The Missing Link Between Strategic Planning and Execution

You’ve invested valuable resources into designing the perfect strategic plan. Now what? Your plan isn’t the problem, but your execution could be. In this short read, Ron Capelle offers three critical steps to ensure your new strategic plan moves your company from a carefully constructed theory into real life reality and the results you expect. Read more

Boosting Performance Through Organization Design

Is your business more likely than its peers to be flexible and successfully responsive to changing business conditions? This detailed article is based on a late 2016 survey of 1,100 executives and other employees at companies with more than 1,000 employees, representing ten industries in more than 40 countries. In it, BCG offers in-depth discussion, analysis, supporting evidence, links to related articles, and recommendations regarding six factors of organizational design most likely to influence a company’s performance, growth and profits.

“A company that incorporates all six will benefit from a multiplier effect: its chance of becoming a top performer increases to more than 50%”.

Read more

How Organization Redesign Could Help You Survive The Age of Disruption

In these times of disruption, fast and furious is generally the rule. To not only keep up, but to stay ahead, Steve Olenski explains that organizations need to “maintain a strong yet adaptive organizational design.” But how? In this article, you will learn four effective steps to clarify what to keep and where to improve, and lay strengthening groundwork to continually adapt and remain competitive. Read more

10 Guiding Principles Of Organization Design

Top CEOs recognize the need for organization change, but they also understand that “shifting the lines and boxes in an org chart” won’t cut it in this business environment.

“A company must make its changes as effectively and painlessly as possible, in a way that aligns with its strategy, invigorates employees, builds distinctive capabilities, and makes it easier to attract customers.”

With an average tenure of only five years, global company CEOs generally have one shot to get it right. However, companies across all industries and geographies can benefit from the fundamental principles offered. Gary L. Neilson, Jamie Estupiñán, and Bhushan Sethi have compiled this article that is well worth the longer read as it provides the sustainable “how to” for leaders whose strategies require a different kind of organization than the one they have today. Read more

Getting Organizational Redesign Right

Initiating organization change that results in disappointment obviously leads to reduced-morale, wasted time and lost expense, not to mention hesitancy and skepticism towards trying again. The good news is that leaders can dramatically increase their odds for success…the first time…using the nine golden rules illustrated in this article. Read more