How To Draft An Org Chart That Works!
Lots of construction business owners want to grow their companies, but can’t. They usually get stuck at a certain size and stop growing for many reasons. Trying to work harder and smarter doesn’t solve the problem and they eventually reach their maximum level of what they can do without hiring more people. Why? Business owners try to do too much themselves, won’t let go, want to delegate but don’t, and can’t decide how or who to hire.
Another common problem occurs when owners micro-manage and control every decision throughout their business operation. They don’t let their people make decisions without checking with them first. Companies also can’t grow when the owner has their finger on every decision including: scheduling crews and workers, ordering materials, buying equipment, meeting with customers, deciding which vendor or subcontractor to use, approving change orders, doing every cost estimate, determining the final markup on bids, presenting every proposal, reading and reviewing every contract, approving all invoices for payment, determining how much money every employee makes, and the list goes on and on. When these control-freak business owners hire people and then don’t let them do their jobs, be accountable, or take on responsibilities, the company can’t and won’t grow.
Don’t hire cheap and hope it works out!
Frustrated and going nowhere, stuck business owners finally make the big decision to hire an experienced manager with a strong resume, so they can delegate of a small part of their kingdom. Unfortunately, their first instinct is to move someone from within the company into this key position who has little or no experience or skills in the area they need the most. After trying this approach for a short time without any luck, they tend to want to hire a low paid assistant, untrained field supervisor, junior project manager, or an estimator with little experience in the type of work they need. Or even worse, rather than taking the time required to find the right person for the job, they attempt to hire a relative, family friend, or in-law who is out of work and seems likely they might be able to do the job.
These poor decisions won’t help companies move to the next level. The real reason for making poor hiring decision is to save money or avoid the time and energy required to hire and pay for the perfect key employee or experienced manager. So rather than do what is right, they hope this easier, more comfortable, weaker, and less expensive choice will work out. You know what happens when you hire untrained cheap people with little or no senior management experience to assist you? You spend all your time trying to keep them busy, answering their questions, helping them do simple tasks, and training them. In other words, you do your job plus theirs, which causes you to work more and achieve less!
Design your BIZ-Function Chart
Most company organizational charts show who reports to whom. They don’t show who is 100% accountable or responsible for getting work done. They also don’t layout all the tasks and functions required to make your company achieve its’ strategic goals and objectives. The best way to organize your company is to draft your BIZ-Function Chart. To do this, take out a large piece of flip chart paper and layout all the tasks and jobs that have to be accomplished in your company, from finding work, to doing work, to keeping track, to administration, and managing your company. Layout your BIZ-Function Chart with these function headings across the top of the page:
- Find Work – Business Development
- Do Work – Operations
- Keep Track Of Work – Financials
- Company Administration
- Company Management
Now using one ‘sticky note’ for each function or work activity required in your business. Determine and list out every task needed to accomplish what your company does. After brainstorming and completing this exercise, post these tasks beneath the function headings in logical order of how you get things done. To receive a copy of a sample Org Chart send an email to GH@HardhatPresentations.com.
For example, under the ‘Do Work’ heading would be the project management responsibility. A full charge project manager handles lots of work requirements including: procurement, negotiating subcontracts and purchase orders, writing contracts, project documentation, correspondence, customer meetings, change order management, preparing and updating job budgets, approving and updating job schedules, drafting progress payments, approving invoices, meeting contract requirements, making the job profit goal, meeting the project schedule goal, customer satisfaction, and many other responsibilities.
Who’s accountable & responsible to get things done?
After your BIZ-Function Chart is completed, the next step is to assign people who are 100% accountable and responsible for each of the work tasks listed. This is tricky. If the construction business owner allows his project manager to draft the subcontracts, but not make the final decision on the price or the selection of the subcontractors without checking with him first, then this task needs to be broken down into two or three parts: draft contract, approve subcontractor, and negotiate final contract amount. That way you can enter the two names responsible and accountable for these different tasks and responsibilities.
Next create an accountability and responsibility chart listing out all of the functions in your company. Assign the appropriate person who is the 100% accountable and responsible person for each task and business function.
Delegate or die!
You can’t grow unless you let go. The more you do for your people, the less they do for you. After looking at how your company really works and how many things you are actually managing, micro-managing, or responsible for, decide what you want to delegate. Determine which areas you should do based on what you do best and will get the highest return on your time for your company’s bottom-line. Almost always, the company owner should stay involved with the finding work functions. By deciding what you want to do, don’t want to do, and should do, you can then create a new job description and management position for someone to take over those tasks, decisions, accountabilities and responsibilities you want to delegate 100%. Only this action will allow your company to grow.
As a professional construction BIZCOACH and popular industry speaker, George Hedley helps contractors increase profits, grow and get their companies to work! He is the best-selling author of “Get Your Construction Business To Always Make A Profit!” available at his online bookstore at www.HardhatPresentations.com. E-mail GH@HardhatPresentations.com to sign-up for his free e-newsletter, join a peer mastermind BIZGROUP, attend a BIZ-BUILDER Boot Camp, implement the BIZ-BUILDER BLUEPRINT, or get a discount for online courses at www.HardhatBizSchool.com.
George Hedley CSP CPBC
Phone: (800) 851-8553
Words: George Hedley