Video Transcript:
The dirty little secret of why your company is not growing. Your revenue can not exceed your company structure or process.
Not long ago while attending a conference I had a member of the leadership team approach me over a company frustration. He felt everyone on the leadership team was running in different directions trying to get a bunch of stuff done but nothing was tied to any specific result. As he described it, we are all kind of bumping into each other not really knowing what each of us are trying to accomplish. This lead to employee confusion.
Employees did not know who to listen to, what was expected of them, or where the company was going. In time, employees started to emulate their leaders; everyone running in different directions trying to get a bunch of stuff done. When revenue stalled the owner and team became even more frustrated. His answer hire; more sales people. This compounded the problem. In fact, the company started losing money. I was eventually called in to one of their leadership team meetings. I asked everyone what they thought the problem was; their collective answer was we need more sales. They identified the problem as a lack of sales therefore they needed additional sales training. In other words more sales would solve all their headaches. My reply was maybe you’re right. I then asked everyone to take out a sheet of paper and write down 5 to 7 specific items they were accountable for.
Here is where the meeting got interesting. Each individual wrote their title, and vague descriptions of what they did; words like I manage the overall direction of my department, I help achieve the company’s overall vision. What was interesting, everyone said they helped out with sales in one capacity or another. How do you measure execution; do you know your specific key performance indicator’s? At times they looked at one another for support to define their KPI ‘s. I’m not trying to demean these leaders, or any other leadership team that is experiencing this. In fact, it’s a natural part of growth. What it boiled down to, no one knew what their specific job really was. Sales was not the problem, structure, clear expectations, process and accountability was! As a leader one of your jobs is to keep things simple, help maintain focus, and define clearly what expectations are for each member of your leadership team.
You can probably guess by the end of this meeting they determined that the organizational structure was only one of the few areas they needed help with. I took them through an in-depth process of identifying what departments where actually needed for their company to be successful, Jim Collins refers to this as having the right seats with in the organization. We then clearly defined what each department was going to be accountable for. At times we were able to define a process as to how each team member would execute their specific role and how they would interact with each other. The team was now able to understand how each departments role affected revenue growth. They were able to set company and department key performance indicators to track their progress, allowing them to be proactive as events unfolded instead of reactive.
This gave the team confidence in knowing exactly who was accountable for what, and how they were to be measured. Now this turnaround did not happen overnight. It took patients, focus and a commitment to the end result. If you feel your organization is experiencing similar frustrations, do the same exercise. Have team members write down 5 to7 specific items they think they are accountable for, and how they are measured for success. Should you become stuck in the process, contact me at the information below to get help with the right organizational structure for your company.
