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The Best Company Structure in Four Easy Steps

November 13, 2006 | By | 3 Comments

Our business schools teach that structure follows strategy. And this big stuff is important to know.

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by Hugh MacLeod But what Your Business Blogger most often sees is where the boss misses the basic questions — the easy stuff.

Such as,

What is the business owner’s most common company-structure challenge?

In our egalitarian new-age of Aquarius where we are all equal to each other and the boss considers the individual input of each of her employees to be the equal of her own or anybody else.

After all, we are all family here.

This, of course, is nonsense.

(Unless you are all family.)

Anyway, companies should be designed on the old-fashioned hierarchical organizational chart so that praise can easily flow up. And the heart-burn can flow easily down.

Your Business Blogger is noticing a horrific pattern where the owner would have direct, non-stop communication with Every. Single. Employee.

This is a well-known time waster, that some business owners employ instead of managing the time of the employee. This abomination is known as an,

Open Door Policy

Which leaves the harried business owner at the mercy of his minions who’d stubble by to cry about a missing cat or babble about a boyfriend.

Not that I could ever tell the difference when I was a company President. That whining all sounded the same.

The business owner must remember that he is the center of the universe. And if he forgets, he must pay someone to remind him. These rented friends are called consultants.

And Your Rented Friend, Your Business Blogger, will remind you (you may not need to be taught, you might only need to be reminded) that You Are The Apex.

Now, yes, you are the center of the universe. But let us elevate you, the business owner, the harried manager away from the center of the circle to the top of the triangle.

The best management structure is a pyramid, not a wagon wheel.

The wagon wheel has you, the boss in the center with the many, many spokes coming directly to the hub. The spokes are the employees, each with a direct line to the boss. This is not good. Your management team — usually made up of cronies and boot-lickers — is bypassed and ignored. Why talk with the first line supervisor? When entry-level nobodies and interns can walk through The Big Guy’s Open Door and shoot the breeze. As if all were equal.

As If.

The amateur boss soon becomes an armature spinning in circles.

But not now. Not after reading this article.

The best structure is a pyramid with the business owner at the tippy top with a few, no more than ten, direct reports. The employee wanting to bother and waste the time of the boss will have to crawl over layers of managers before getting to you, the owner.

Whose Door Is Always Open. Because Employees Are Our Most Important Asset.

(Yes, you can keep that silly policy, but with luck no one will get close enough to you to use it.)

So here’s your 4 step by step guide to moving from the hub and spoke to the triangular pyramid, pointing, reaching to the sky.

First. Appoint a deputy. A second in command. A chief of staff whose job is the management of your most valuable resource: your discretionary management time. It could be your secretary. Right-hand man or Girl Friday — your hatchet person.

Second. Put each business function in a box. Every action and process in to a discrete description. An organization chart box with hard edges with one single line going in. And if a manager, no more than 10 lines going out. Then,

Third. Put employees in a box and a label. Just as you would any commodity which/who could be easily replaced. Remember what that famous Frenchman Charles de Gaulle said, The graveyards are full of indispensable men.

And finally, Fourth. Close your door.

The best company structure is a pyramid shaped org chart. Get yourself at the top to be on top of your business.

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Thank you (foot)notes: Management Training Tip: Time is your most valuable possession.