Transcript:
While working with one of my clients, whose software company has been growing very rapidly the subject about maintaining organizational focus and culture came up as a discussion progressed. He mentioned that the company had been growing pretty well but there seemed to be areas elsewhere that had been negatively impacted projects were getting delayed number of customer escalations were being experienced people were stressed.
Productivity was hampered and overall the team morale was low. He wasn’t sure what exactly was causing this after spending some time going back and forth on the issue. We both agreed that it was the growing of people on Project teams and the criss-crossing of communication.
That was causing the issues as seams begin to grow the number of people on the projects is at the heart of what makes Communications a challenge. It’s not that the customer needs or project budget or the technical complexity that poses the greatest challenge.
It is the number of people with whom we need to communicate about the customer needs or about technology or about the budget that makes it harder. Let me explain what I mean, and I coach and Mentor founders of software companies to build scale in their business fast. In this video I’m going to talk about why your current organization structure could be choking you and what you could do about it.
You know when we get started and just have two people on a project team the lines of communication look like this. When we add another person then the lines of communications double like this and let’s add one more person to the equation the lines of communication increase further.
Now let’s just tweak one last time and make the number on this team eight. Can you see the impact on the possible communication channels. My client with a stunned look on his face saw this and said no wonder I’ve had so many problems with the growth of my business.
There’s actually a formula to figure out how many communication channels are possible with direct connections the formula is n into n minus 1 divided by 2. Where n is the number of people so as you can see the more the people on your team. The more complex communication becomes the communication formula is only a way to express this challenge numerically.
If this challenge is not addressed you may face implications such as Financial loss due to multiple bosses or leads to report into overuse of resources. Poor Communications across departments and teams lack of clarity on priorities and goals. Overlapping roles and of course delays in actions.
When the company is small sized developers and other team members may be deployed on a single project having one reporting relationship and one customer to work with as the company grows. You
now have multiple people working on multiple projects and of course multiple customers to deal with this starts to create confusion on prioritization of control. This is when you need to go back to the drawing board and start to build up your organization.
All over again think through the structure in great detail from scratch take care that your structure reflects the goal vision and the personality of your company. For example if you’re a service based organization that focuses on solving customer problems in specific domains with customized Solutions.
Then you may want to consider team structures where domain specific verticals are identified and delivery teams are formed within this domain vertical. So the team manages clients within this area only if you have a niche. Where let’s say you focus on creating just different kinds of websites on an ongoing basis then you need a functional assembly line kind of structure.
Where skill based teams are put together that is Engineers with UI design skills are all clubbed together developers can be clubbed together for the back end. QA will form one team and maintenance can form the other team each functional group will end up working for almost all of the clients. But their value add will be limited to their own skill area only.
This helps team members to get very good with their specific skill area and create faster results on the other hand. If you’re a produt-based company then Technology Innovation product management marketing and customer service shall be key areas to group teams by as excellence in these areas is what will bring you more Revenue the type of structure you choose must help reduce overlaps and allow team members to remain focused on specific goals for longer stretches of time and there must be a clean handoff across teams re-look at your organization structure to see If it is a fit for your current purpose.
If you get stuck and need more help please do reach out and I’ll be happy to coach you through that if you’ve liked this video please do not forget to like and share do also subscribe to our YouTube channel to see more such videos sharing tips on scaling up thank you for watching.
