While the organizational chart is an important foundational building block of most businesses, for start-ups it is typically non-existent, and incorporating one later can be a disaster if not planned well.
In the early stage of a start-up, founders typically surround themselves with like-minded visionaries who are willing to do what it takes to build a business from the ground up, taking on new duties and roles as needed as the business experienced rapid growth. For instance, the person responsible for business development eventually is also in charge of marketing, operations and HR. While this can work at first – sometimes even for years – eventually it becomes clear the current structure is not sustainable or scalable.
As founders work with advisors and investors to plan for growth, communication with the existing team members is important to avoid misunderstanding, frustration and unintended turnover. In many cases, founders assume team members will be happy to be relieved of some job duties, but if the team members aren’t part of the planning process, the perception can result in them feeling unwanted or disappointed to lose job duties they enjoy.
The introduction of a formal operational structure can impact company culture as well. What worked for a small team may no longer work for a larger team. Reimagining and adapting the culture to reflect the change that comes with growth is important.
Our team shares a few tips for how to include employees in the process of planning for growth and organizational change:
- Develop an organizational chart. Even if your start-up is still very young, consider what it might look like at various stages of growth. This may change as you evolve as a business leader but the vision for the future can help current employees imagine their role and how it might change.
- Identify and define anticipated leadership roles and reporting structures. Establish core job responsibilities for each. Present this to the existing team members and open the door for discussion for what this means for their role with the company and where they possibly fit within these future roles.
- Be transparent. If it’s clear that team members currently filling certain roles such as HR or marketing do not have the skills to transition into the new leadership role, take time to meet with the person 1:1 to explain the role, the candidate you are seeking, and how you imagine their role changing and what a new role could look like.
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