Organization Charts

Org Chart Management - Establishing an organizational & personnel chart - a hiring chart that rolls into your financial pro forms is going to be an important tool for you, your management team and, eventually, your Board of Directors.   

Strategic Results for a division - Each division has a strategic result that it must achieve (unconditionally) to justify it’s existence.  For example, you may decide that your sales division has a strategic result of “build brand value and drive top line sales to create cash flow.”

Who to lead it? - Determine your top hire for a division is among the most critical decisions you will make; effectively this hire will set the tone for the entire division and also reflect on you - after all, you hired the division leader.  

Managing the process

Position Agreement - We discussed position agreements when it comes to a one-on-one review, but what about new hires? We include position agreements in the organizational chart and require a detailed analysis of the role prior to commencing a hire or promotion. 

Offering (total comp) and can you afford it? - Here, we map the hiring needs to the financial budgets - ensuring that we have the working capital (i.e. cash-on-hand to support the operational expenditure) for months (typically 12 months).  This way, there is no concern over business fluctuations (cash flow, cash, etc) that may impact the new hire.  The worst thing for culture is a situation whereby someone has been hired and the cash is not available to support it. (Been there, done that - it’s not fun for either side)

PRF & CRF - Position requisite forms (PRF) and confirmation requisite forms (CRF) are used to manage our recreating efforts. The PRF is the business case for the hire (typically a return on investment or risk-management case) alongside the Position Agreement.  With this information, the recruiter can actively pursue candidates for the role.  Once the hiring manager has determined there is a good fit, she will complete a CRF so that the payroll forecast is updates and our financial pro formas are updated.  This is critical - payroll is the largest operational expense in any organization - it can make or break a company; be sure to keep your eyes on the payroll numbers and understand when you should stop and start hiring.

Communication Tools - Reviews and Improvement plans

Quarterly reviews - Quarterly or semi-annual reviews help drive home communication with your management team; overtime, I created a list of values that I felt was important to align myself with my managers. Separately, I have a list of values for alignment with my leadership team.  In other words, you set the management values and need to gauge your team by those values.  For teammates that are not at a managerial level, there is a standard review - which aligns to the value of the organization on the whole.

Personal Improvement Plan (PIP) - In cases whereby the team mate is not performing to the role as set out in the Position Agreement (or there is another issue at hand), it’s important to issue a PIP; this is a simple, one-page summary of what needs to happen to improve and retain gainfully employed by the Company.  Then, you need to check-in on the PIP weekly and ensure the improvement plan is being followed.  If it is not, then it’s time to cut bait and terminate.  There is a saying “hire slow, but fire fast” - that is a very true statement.

Communication Tools: Weekly Objectives (one-on-one meetings)

We also meet with our staff directly one-on-one. Each person in the Company has a direct one-on-one meeting whereby three main categories are discussed: 1) Projects - key projects they are working on - this can be linked to the strategic roadmap or contribute towards it 2)  People  - any human resource issues such as management of others, etc 3) Patterns - are there any patterns to identify - good, bad or ugly? It’s important to flag any issues/patterns you see.  We also review what is called Position Agreements - a detailed summary of the role, which includes both strategic and tactical activities required.

Communication Tools: Monthly Goals

Across the Company, we have communicated real-time data and information.  For the longest time, I communicated information via weekly scorecards with our management team - the only problem was this: I was dependent on my management team to communicate across their teams my words - basically a big game of telephone and, sure enough, communication problems persisted; staff resigned citing lack of transparency or failed to communicate upwardly the information to me, directly.  It was a cluster.  Over time, I found a better solution - a company-wide standup with real-time information dashboards that provided teams with metrics on key areas of the business; this information flow dramatically improved morale and problem-solving in ways that I’d never seen before.  Today, that is a cornerstone in our success. 

Communication tools: Rolling 3 month strategic roadmap

Quarterly themes are broken down into monthly objectives broken down weekly.  I use this tool as the key directive communication piece - tying all the business divisions together to the common quarterly theme.  Simple communication tools such as a Gantt chart or task-assigned software (e.g. Trello software) are brilliant communication devices. The management team should know the strategic roadmap and understand their role in contributing to it.  This will help the empowerment of your respective division heads and give them the authority to feed-up best solutions to your directives.  

Communication Tools: One Year Goal & Quarterly Themes

One year goals give you focus - what do you want to accomplish a year from now? What are the action items that need to be taken (And when?) to reach the annual goal.  The annual goals should lead up to your 5-year plan (and beyond). 

Each fiscal quarter should have a corresponding objective that helps you lead up to your fiscal goal.  Like building blocks, you can layer quarterly objectives ontop of one another to scale the organization towards your long-term goals.

Communication Tools: 5 Year Plan

 Your vision requires a long-term plan. That plan can be 5-, 10- or even a 20-year plan.  A good friend of mine, Art Glenn, was the head of GE Medical where he used to develop 20-year plans.  In the energy sector, utility companies develop 30-year and 5-year plans. In an early stage business, a 5 year plan may seem overboard as it will most certainly change in due course (And probably many times!); but, there is value to scoping your plans and crystalizing your thoughts.  A great case study here is Jeff Bezos, who is best known for his continual business plan editing.   As the business evolves into its later stages, the long-term plans will take form.

Communication Tools: Values

Ok, ok, ok…  it sounds lame, but it’s actually very critical to success.  Corporate values are an important aspect of the culture, especially as you scale your organization - you want to be able to bring your discussions back to the values and mission statement from time-to-time - this will be particularly helpful during times of strategic pivots and organizational adjustments.

Communication Tools

A big part of the job is now communication.  If you are not a natural communicator then you will need to invest time and energy into improving this skill.  You will need to communicate high-level ideas to granular details. You will also need to communicate with team mates when they are falling short in deliverables and when they are outperforming. Among the many things you will need to prepare for is having a lot of uncomfortable discussions; I used to avoid conflict - putting difficult conversations on the ‘back burner’ - the only net result was a big blow up when the time came for a difficult discussion.  


Growth is the focus.

Transitioning out of the Start-up phase and onto the growth phase requires another set of skills - and these are skills that you will need to develop very quickly as your business will certainly require it.  There is a term that we often use ‘leveling-up’, which means individuals in the organization are required to improve their skill sets in ways that have not been anticipated.  If you fail to ‘level up’ or, if you fail to ‘level up’ your management team then you will likely fail.  Your failure will be bigger and more catastrophic than if it were to occur during the start-up phase for social reasons (By now, you’ve likely been revered by friends and family and the pressure is on to remain successful.)  or the fact that you will have to declare bankrupt if you cannot meet your payment obligations, etc.  It’s like doubling down on a hand of blackjack - except you don’t have a choice as to whether you increase your bet, you have to increase your bet.  So, all things being equal, you have to ‘level up’!