Levels of Work in an SME

Why would small (SME) organizations have curiosity around the research of Elliott Jaques? Admittedly, Elliott worked with large organizations, containing multiple layers of management, which demonstrates that his research had relevance in very complex structures.

But, will it work for my SME company?
If a large organization has a problem, they have budget and people resources to throw at the problem. And if they miss, they have more resources left over to try again.

If a small enterprise has a problem, they have a smaller budget and fewer resources to resolve the issue. And if they miss, it might be fatal.

Why a structural approach?
Most people call me with one of two issues. They feel they have a communication problem or a personality conflict inside the company. I allow them to explain for about ten minutes before I interrupt and interject that I do not believe it’s a communication issue or a personality conflict. I think it’s a structural problem.

Most SMEs have a flexible organizational framework, which is the beginning of the problem. The company was organized, out of necessity, to focus on things that look non-structural, like sales. Every startup has to focus on sales. If there are no sales, the company dies, sooner rather than later. As the organization creates a sustained momentum of sales, things become more complex and the organizational structure takes shape, without forethought, without discipline.

Organizational structure is simply the way we define the working relationships between people, related to these two things.

  • Accountability
  • Authority

When we fail to define the accountability in a working relationship and fail to define the authority in a working relationship, we get organizational friction that appears to be a communication problem or a personality conflict. You can have all the communication seminars you want, do all the personality testing you want, until you get clear about accountability and authority, the problems will remain and become more persistent over time.

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