If you run a small business, why would an org chart matter to you? No matter the size of an organization, the importance of creating a team that is both structured and talented is critical for success. An org chart gives you the tools you need to support this growth in a way that matches your vision and plans for innovation. Let’s consider it your roadmap for sourcing a successful team.
Securing talent is one of the most important decisions startups or small businesses can make. It all boils down to who you hire, when you hire them, and how they work together. There is no one size fits all for success, but by creating an environment where ideas can be collaborated and contested, selecting a team with a common goal and purpose can help assure that you won’t (hopefully) have to recreate your team from square one if problems arise.
There are lessons to be learned no matter the size or scale of a business. In this example, let’s take a look at the evolution of the org chart of a high-growth tech startup that’s early roots mirror that of a small business.
The Founder Equation
At the earliest stage of starting a business, titles or hierarchy aren’t usually necessary. The main goal should be to figure out how many co-founders you need, and who those individuals are to cover the skill sets needed to push the businesses forward. Generally, each co-founder should have an understanding of the business and how their skills will contribute to the business goal. However, they should be different enough that each can operate independently of one another and have the trust in each other to make decisions for the business separately. Having two co-founders sets you up in a good position for this. Going alone requires one person to wear too many hats, which can ultimately have an impact on operations, especially if you are still working full or part-time at another company while trying to raise capital.
Having a partner to lean on will help tremendously in the earliest stages, and you should consider more than two co-founders if you’re going into an area that requires specialized knowledge.
Expanding the Team
After the founding team is created, recruiting individuals that can help execute on the product vision is the next step. While the team may be small, ensuring that it is agile and has the ability to demonstrate that the business idea is or isn’t working is what matters most at this stage.
Flexibility at this point is critical. The CEO should be executing and overseeing administrative tasks, seeking out funding and providing guidance to employees about the business and product vision. The rest of the small team, at this stage, would be individuals working across product, engineering and design. Spending resources on secondary business elements, such as marketing, wouldn’t be a smart allocation of funds.
The First Big Hires
Once your business has proven early rates of success, scaling becomes a top priority. At this point, it is critical to get talent in the door to help develop the product as quickly as possible. This stage involves allowing current team members to take ownership of their respective areas and hire beneath them to create larger teams or hiring additional talent to manage the build out of these teams. This would also be the time to hire a head of operations to maintain operational tasks, a head of growth to attract new customers, and a head of product to execute product vision.
When the business is ready to start driving revenue and building out its commercial operations, then it’s also ready to start building out its existing teams.
Depending on where the business sees most potential, they can break down teams into individual entities. For example, the growth team could be reworked into sales, marketing and product groups. Additionally, as the CEO continues to focus on raising capital and the overall business vision, the company may require adding additional talent across areas such as finance, legal and people.
It is important to note that the risks of administrative bloat and faulty processes become apparent at this stage, and it is important that people are hired to ensure nothing is missed.
At this point, a business can go in many different directions. Taking your small business to the next level means expanding its size, which could require the hiring of new executives or other talent to meet the demands of the current operations.
If the goal from here is to go in full-on scaling mode to prepare for an IPO, hiring a chief financial officer will help in preparing for this transition and equip the business to start operating like a public company. Additionally, administrative and operational requirements will become high priority, which could mean having full fledged teams to oversee headcount and public relations.
Not every business will follow this exact path, but mapping out an internal structure that fits into your business’ long-term growth strategy will no doubt set your company up for success.
Christian Wylonis is the CEO of The Org.