Improve results by revisiting your organizational structure

One of a leader’s most important responsibilities is to put the right people in the right spots to advance the short- and long-term causes of the organization. Whether you are running the accounting/finance group, the manufacturing operations, or leading the firm as CEO, there is no more important responsibility.

The organizational structure you have in place today may not always be the most effective. Perhaps instead of a functional structure, as many use, a geographic, product, or customer/market format would be a better choice. They all have strengths and weaknesses.

In this age of technological advances and information sharing, why are most companies’ organizational structures the same as they were years ago? The answer is that change is a daunting task. First you have to determine if an alternative structure is beneficial. Then you need to find the right people to fill the positions. You then have to sell it to the organization’s stakeholders—inside and outside the company.

A worthwhile exercise is to imagine starting over. Think outside the box and ignore any constraints. Starting with a blank sheet of paper, consider what structure you would design if you were creating your business from scratch. Don’t feel limited by those working with you; that’s the next step to fill in the boxes. It is a long term play and not easy.

Today’s new form of organization is much more horizontal than vertical and provides a landscape that promotes creativity and innovation by all. Often the best ideas do not come from managers, but those actually doing the work. Trust your good people—in many cases they have more to offer than you give them credit for. Along the way you might even reduce headcount as the value of some middle managers is questioned.

Give it a try—start over and see what unique thoughts you come up with. The end result could be a more effective and efficient organization and a more engaged workforce.

Stephen W. Christian, CPAStephen W. Christian is a director at Kreischer Miller. Contact him at Email or 215.441.4600. 




Subscribe to the blog

You may also like: