One of the challenges I find many leaders discover as they grow their business is the way they need to change the way they manage their people.

In the early days, most entrepreneurs work to what I’d call the assistant model.  ‘I’m busy – I’ll take on someone to help me.  They can do anything I’m too busy to do’. Such an approach is fine to start with.  There is no point in carefully defining roles in a tiny business.

Then as the business grows we recruit a few more assistants, perhaps with a little more focus. Joe does Finance, Susie does Manufacturing, Fred does Selling and so on. Which again works fine for a while … But then somewhere between 5 and 20 people it goes wrong.  And its easy to spot.  Its when the new joiner or visitor finds it confusing to understand who does what.

So that’s solvable.  Lets define everyone’s job.  And then the problem becomes clearer:

Whilst Joe started with Finance, he also does procurement, because its close and he’s good with numbers, and also manages the CRM system because he’d good with systems.

Meanwhile Fred, the sales person, is also responsible for supplier relationships because he’s a good negotiator.

And whilst Susie is mainly responsible for manufacturing, she’s picked up HR too because she had a personnel problem and spent the time working out how HR should be done and so then helped out the sales side when they had a problem and by default they become responsible for HR.

I hope you’re beginning to see the picture!  Although each individual decision was logical and appropriate at the time, the organisation has become a bit of a tangle, and obviously that leads to difficulties.  Indeed I’d go further and say this pragmatic approach, whilst right in the early sages, can ultimately lead to company failure.

So how do we solve the problem.  A key role for the leader is to define roles – to sort out the tangle.  In practice this has to be step by step, and to do so means developing a clear logical structure.  I’ll resist the temptation to pontificate here on how to develop the ‘right’ structure – I might do that another day, especially if someone asks.  I’ll resist partly also because I’m a pragmatist and believe there are usually a number of viable structures. For me what is critical is simplicity and clarity.  It is for the leader to lead the team in thinking through and defining roles that fit together logically.

Which leads me to another challenge.  How to document the roles.  I recommend a tool I call the job function / job role matrix which I describe in another of my Managing Director advice blogs here.