Preparation for Growth: Restructuring your business
During my time working with SMEs, I have noticed a trend where businesses often start small, relying on family members, long-time friends or ex-work colleagues to help the business get started.
The team is ‘all in it together’ and sacrifices from them all will have been made along the way to get the business on its feet. This is all well and good and if the business is thriving there is no issue. But what happens when success really takes off and the business needs to expand and quickly?
This can sometimes come as a surprise and be a massive challenge to the business owner. But to grow it takes a mix of good organisation with a good team and an infrastructure to keep the business growing without losing focus.
The key advice I would ask the business owner to consider is:
- Have a plan and a mission statement – be clear what responsibilities you want and what you need to focus on. Buy in expertise as you need it, on a contract basis if needs be to help you grow. Make sure your employees understand the direction of the business and that they are truly onboard with the goals and values you have set.
- Prepare your infrastructure – if you rely on technology for your business (who doesn’t these days) then this is one of the most important and potentially expensive issues you will have to face. As you grow you will need to collate information differently and potentially use a different level of skill. Ask yourself, can your current workforce deliver?
- Get the right structure – whilst your existing team may have been loyal and put in the hours to get your business to the point of growth you need to ask yourself, are they the still the right people to take it forward and grow? For example, have they the attributes to know when and how to delegate without you always being around? Can they supervise and manage newer employees into the business and can they successfully interact within a larger team with increased volumes of customers?
Often growth leads to the need to restructure your workforce. As the business owner, your sense of loyalty for the existing team will naturally be high. But for the sake of everyone and the business you must not put off asking yourself if these same individuals will cope with growth.
It is a real risk that they will not be able to cope and will become a risk to your business in the future.
Changing structures can lead to a redundancy situation so there needs to be a document that clearly explains the ‘rationale for change’.
Use this rationale document to design the staffing and skills structures you will need. Then you can assess if you have a skills gap in your current workforce. Once you have done this then it will become clearer on how many and what types of roles you will need.
Placing people ‘at risk’ of redundancy is tough and as the business owner you have responsibility to plan the consultation process you will need to follow plus what needs to be said face-to-face with each employee to minimise the risk of challenge.
Using the services of a third party to assist with the consultation process can provide a useful independence to the process.
HR consultants have these ‘difficult conversations’ on a regular basis, and can help you deliver your message in a way that is legally compliant but most importantly helps both you and your employees through a difficult and stressful situation. Good planning ahead of any conversation with individuals is key.