What’s Wrong With My Org Chart?

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“What’s wrong with my org chart?” Ron wanted to know.

“You tell me,” I said.  “An org chart is just a piece of paper with a picture of the way you think.”

“What do you mean?”

“Organizational structure is simply the way we define the working relationships between people.  Org structure is a mental construct, your mental picture of the way people ought to get on together at work.  You drew the picture.  What did you have in mind?  You tell me where the friction is?”

“Okay,” Ron started.  “Just this morning, the sales manager called a meeting with the marketing manager to talk about their expenses to date related to the budget each submitted at the end of last year.”

“And?”

“And, the marketing manager said it wasn’t the sales manager’s business to see how marketing dollars are spent.  She tactfully refused to attend the meeting.  She said the sales manager was NOT her manager and declined to go.”

“What was your response?” I asked.

“I had to admit, the marketing manager has a point.  The sales manager is not her manager.  When she took the position, we were very clear that it was her department.  She has very clear objectives and unless she is off track, we expect her to run things without interference.  But, still, declining to go to the meeting seemed a little insensitive.”

“So, when you think about their working relationship, how do you see it?  Clearly, neither is each other’s manager.” I said.

“Well, they seem to get along fine, at least until this meeting thing,” Ron shook his head.

“Let me be more specific in my question,” I replied.  “How do you see these two questions? –

  • In their working relationship, what is the accountability for each of them?
  • In their working relationship, what is their authority?

“Well, when you put it that way, marketing should coordinate with sales, and sales should coordinate with marketing.  We have significant trades shows we attend that eat up a lot of marketing budget.  Our trade show booth is generally staffed with people from the sales department.  So, the two departments need to coordinate together.  The company has a high vested interest in their coordination.”

“And, in their working relationship, what is their authority to make what decisions?”

“Each department has a department budget, submitted each year and approved by their manager?”

“Same manager, between the two of them?”

“Yes, our VP of business development is the manager of both,” Ron clarified.

“How clearly have you spelled out their accountability and authority in the work they do together?  You just explained it to me, how well have you explained it to them?”

“But, they are supposed to work together, shouldn’t they be able to figure it out?” Ron asked.

“Apparently not.  You think you understand their working relationship, in fact, on your org chart, you drew a dotted line.  So, the situation looks like insensitivity, when the friction is because you failed to define the accountability and the authority in that dotted line.  You put the dotted line there for a reason, but failed to define it.”

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Hard to Find Good People

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“I hear you finally extended an offer today for a Project Manager,” I said.

“Yes,” Colleen replied. “This has been one of the toughest searches ever. It was difficult to find anyone who wanted to apply. And, their first question was about working from home.”

“How did you make the decision, that this was the candidate to pick?”

“First, he actually agreed that he would work in the office. And, he seemed really enthusiastic. Said his last job was a dead end, that he was looking for more challenge. I liked his attitude.”

“And, his experience,” I pressed.

Colleen hesitated. “Well, he said he had been a project manager before, so we will see.”

“And, the length of projects he has under his belt?”

“Most of his projects were about three weeks in length. I know it’s not the same as our projects, which last nine or ten months, but he knows how to use Excel, so he should pick up our project management software pretty easily. I mean, project management is project management.”

“You didn’t see a mis-match on the length of projects?” I asked.

“Well, yes, I knew that might be a problem, but he was still the best candidate, and he didn’t ask to work from home.”

“So, tell me, Colleen, what could go wrong on a three week project, and what could go wrong on a ten month project?”

Good? Leadership

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From the Ask Tom mailbag-

Continued from yesterday –
Question:
I recently had a conversation with a leadership guru that stated that you don’t need formal structure in a small business, if you have good leadership. He indicated that you don’t need documentation, role descriptions, or even much for KPIs.

Response:
The problem with “good leadership” is that it becomes person dependent. We are juggling three balls in the air.

  • Leadership
  • Small Business
  • Good Leadership

Leadership
Leadership vested in a single individual, is person dependent. It may work in a small business because there aren’t that many people. A handful of people can follow a single individual, because if there is any doubt as to who has the authority to make a decision, the team can just ask the leader. That also means the leader must be available (proximity). But, if all decision making must go through the leader, as the company grows larger, what happens to the speed of decision making. Slows down, or stops.

Small Business
All decisions going through the leader is a hallmark of a small business and assures that the business will remain small. If all problems have to be solved by the leader, as the company grows larger, what happens to the speed of problem solving? Slows down, or stops.

Good Leadership
Good leadership requires competent management skills. Good management requires competent leadership skills. You can’t have one without the other (please, no discussion about leader vs. manager). Effective leadership, among other things requires clarity. Poor leaders will be uncertain in their decisions and communicate ambiguity to the team. Good leadership requires clarity. So, if your leadership guru says all you need is good leadership, I might agree, but only if that definition requires the formalization of things like role descriptions, documentation and KPIs. That’s what good leadership is, it’s clear.

No Formal Structure Required?

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From the Ask Tom mailbag –

Question:
I recently had a conversation with a leadership guru that stated that you don’t need formal structure in a small business, if you have good leadership. He indicated that you don’t need documentation, role descriptions, or even much for KPIs.

Response:
If life were only that simple. Let’s break this down over the next couple of days.

You don’t need a formal structure.

You have a structure. Every company has a structure. Structure, or organizational structure, is simply the way we define working relationships between people. Org structure is a mental configuration, usually starting with the mind of the founder (or current CEO). But, everyone else in the organization also has a mental configuration of those working relationships as well.

We translate that mental configuration to a piece of paper, with boxes, circle and arrows and call it an organizational chart. It’s a two dimensional representation of that picture we have in our heads. Important in that org chart is the way we define two things –

  • Accountability
  • Authority

In the working relationship between two roles in the organization, what is the accountability and what is the authority (to make decisions or solve problems the way we would have them solved)?

So, on the face of the statement made by your leadership guru, I would disagree. It is important to define the working relationships and to put them on a piece of paper so we can discuss them. The purpose for the discussion is to ensure that what the founder, or CEO, thinks is pretty close to what everyone else thinks. Without that agreement, friction occurs in the form of personality conflicts or communication breakdowns.

More Practice

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“Practice makes perfect,” Melanie grinned.

“No,” I replied. “Practice does NOT make perfect. Practice may make you feel better, repeating grooved, routine behaviors, but, those behaviors may still miss the mark. Practice does not make perfect, only perfect practice makes perfect. It’s not the repetitions, it’s the right repetitions.”

“But, you always say that we learn from mistakes,” Melanie chided.

“Learning is making mistakes, but you have to learn from the gap. What is the future state of performance, what is the current performance, and what’s the gap?”

“So, there is some analysis going on?” Melanie confirmed.

“And, often that analysis is invisible to you because you are getting comfortable with repetition. But, it’s just a feeling. What’s the difference between training and coaching?”

“Training gets you started, but practice makes you better. Learning from mistakes only works when you recognize the mistake, and figure out how to do it differently. And, sometimes we can’t see the mistake, or the correction, as easily as someone else. That’s where a coach comes in.”

“You said you had been through training,” I nodded, “and you were able to describe the training, as scheduled, with a curriculum. What about coaching? How would you describe coaching here?”

Melanie paused for a very long time. “In my days here, coaching seems elusive. I don’t know if I can put my finger on it. Underperformance is more likely met with reprimand and training, more training, back to training. I don’t need more training, I need more practice, perfect practice.”

Perfect Practice

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“The training only got you so far,” I nodded. “But, your comfort level with the skills, competence only came with practice?”

Melanie confirmed, “Lots of practice.”

“What kind of practice?” I wanted to know.

“What do you mean?” Melanie looked puzzled. “I just did what I was supposed to do, over and over, at first in fits and starts, but eventually things got easier.”

“I mean, how often did you practice, what was your duration of practice? What was your depth of practice? What was your accuracy of practice? And, how did you know you were getting better?”

“In the beginning, it was slow, frustrating. I was uncomfortable. Things didn’t turn out as expected. Each way I turned, I thought someone was going to scream at me for doing it wrong.”

“Did anyone scream at you?” I asked.

“Not really,” she replied. “I know I got some sideways glances, and likely people were talking about me behind my back.”

“If no one was screaming at you, and perhaps people were talking about you behind your back, how did you know you were getting better, improving?”

“At some point,” Melanie thought out loud, “I just got more comfortable. Maybe people were still talking about me behind my back, but, it didn’t seem that way. It was just a feeling.”

“I started this conversation by asking you the difference between training and coaching,” I reminded her. “Training was organized, disciplined, it was an event, but it only got you to a minimum level of technical knowledge. Moving toward competence required practice.”

Melanie nodded. “It’s funny. Whenever we see someone struggle in their job, our first move is to send them back to training. And, often that training doesn’t have much impact. What you seem to be saying, is that when someone struggles, they may not need more training, they might just need more practice?”

Beginning of Competence

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“What’s the difference between training and coaching?” I asked.

Melanie was a new manager. “I’ve been to training,” she replied. “It’s scheduled, it has a curriculum, it’s disciplined. Someone thought through the sequence of learning, identified specific skills.”

“And, when you emerged from the training program, certificate of completion in hand, did that make you a high performer?”

“That’s was my impression,” Melanie said. “But, that impression turned out to be wrong. The training gave me insight into the way we do things around here, but I was certainly not a high performer.”

“You seem to be comfortable in what you are doing now,” I nodded. “That wasn’t the result of the training?”

“Not hardly. I learned, possessed some technical knowledge about our methods and process, but I was very much a newbie.”

“Technical knowledge, but not competence? On the other hand, you appear competent now. What happened?”

“Practice,” Melanie smiled. “Technical knowledge will only get you so far. Competence requires taking those first steps, hands on, then practice, lots of practice.”

What’s Local Anymore?

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“So, it’s important to be Number One or Number Two in our market. I get that. Third or Fourth place just creates a target. Can we use geography to narrow our market definition? I mean, as a local supplier, we have an advantage. We can honestly say that we are Number One in our local market,” Gene explained.

“Yes, if your market is truly a local market. But, Gene, I gotta tell you, I have seen some trucks rolling around town from a new competitor I haven’t seen before,” I replied.

“Yeah, I know who they are. Their headquarters are on the other side of the state. They don’t do any local advertising. I think they are depending on the internet to get their leads. They show up pretty heavy in search engines. But, still, they’re from out of town.”

“Gene, I visited their yard. They don’t have an office, but they have six trucks in your local market.”

Living Off the Crumbs

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“Yes, we have a couple of competitors, big competitors, but they pretty much leave us alone. We’re much too small in the market to be more than a thorn in their side,” Gene explained.

“So, as the overall market contracts and the Top Competitors‘ revenues get pinched, where do you think they will go, to hold on to market share,” I asked.

“Well, we always hope they will fight with each other,” Gene continued.

“Why would the Top Competitor in the market fight with Number Two when they can just come in and take out Number Four or Number Five?”

Gene sat up in his chair, suddenly uncomfortable. “Well, Number Four would be us. And they have always left us alone. After all, we just pick up the crumbs that fall off of their cake. Why would the Top Dog want to come after us?”

“Why would the Top Competitor want to spend a lot of money, energy and resources fighting with Number Two, when they can take your customers without a whimper?” I asked again.

I could see Gene’s eyes tracing this chess game in his mind. “Look, Gene,” I continued. “In any market, when times are good, it’s easy to be Number Four, living off the crumbs. But, when the market gets tight, the only place to be is Number One or Number Two. Number Three and Number Four will have their heads handed to them.”

Undergrowth

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“It’s strange,” Byron said. “A couple of years ago, we were on top of the world. We were the industry leader, now, with COVID and supply chain issues, things are tightening. You just never know.”

“So, this was not predictable?” I asked.

“No, our growth curves just showed, no turning back. I mean, it wasn’t hockey stick growth, but continued growth just the same. We just didn’t think we would ever have to pull in our horns.”

“So, Byron, what’s the purpose for a forest fire?”

“What do you mean? How can a forest fire have a purpose?”

“From an ecological sense?”

Byron thought for a minute. “I have heard that when a forest becomes choked with undergrowth, a fire can clear it out. Though it appears devastating, that’s what brings on new growth.”

“What could that tell us about business cycles?” I probed.
“Sometimes the market gets overgrown and has to be cleared out?” Byron tested.

“Yes, in fact, if you look at macro economic climates, you will see very distinct cycles. Occasionally, there has to be a clearing of the undergrowth. So, what if you looked at your own internal business cycles, within your own company. What do you now see?”

Byron pondered. “I see that, as we grew, some of the things we created weren’t good for the long term health of the company. They seemed like a good idea at the time, but, perhaps, we were just creating undergrowth.”