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Guest Post by Kyle Danner, EOS Worldwide
Jim Collins described the concept of “right people, right seats” in his business classic From Good to Great. In an earlier article, we shared a simple process to define whether employees are the right culture fit. Those individuals share your core values and fit your culture like a glove.
“Right Seats” are those individuals working to their highest and best skill and capacity. To define your company’s Right Seats, the best place to start is with your organizational chart. Rather than trying to make your existing one work, wipe the slate clean and start from scratch by answering three questions.
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Asking this question may be a stretch. It’s tempting to start with what your company looks like today. Instead, consider what your company needs in the next six to 12 months, then think of structure first and people second.
Start at the leadership team level with the premise that every organization has three major functions, or leadership Seats (if it helps, imagine or draw out three boxes next to each other):
You may need to customize the functions to your organization’s unique needs. For example, marketing and sales may break into two separate functions—one for marketing and the other for sales. Operations may be divided into functions like research, design and production. Finance might break into human resources and IT.
There will be one or two other functions, too. One function oversees and leads the major functions (marketing and sales, operations and finance), ensuring those leaders work well together. The second function is the visionary leader, usually the founder or current owner.
If this is you, this exercise gives you a chance to be brutally honest with yourself. Do you enjoy leading and managing major functions? Do you excel at keeping things on track and instilling discipline and accountability? Can you dive into the minutiae to troubleshoot problems?
Or do you like staying at the 30,000-foot view, looking at the big picture? Do you love driving culture? Do you have 20 new ideas because you always listen to the most popular business podcast, read the latest leadership book and stay on top of industry trends?
If you’re the latter, you’re a visionary leader. You need to find your perfect opposite who’s energized by the former. That perfect partnership will drive your growth like rocket fuel.
But don’t worry if you’re not a visionary leader. Not all organizations need a visionary, but they do need their teams to keep an eye on emerging industry trends or to think creatively about the future of the business.
When defining your company’s structure, the key is to keep it simple with three to seven major functions. Remember, less is more.
With those defined, let’s move on to the next question.
For each of your company’s functions, define five major roles and list them in your org chart. That is, determine the top five things that each Seat is accountable for. Here are two examples to use as guides.
If a function has direct reports, the first role is always LMA. LMA covers all of leaders’ and managers’ duties when working with their teams, including communicating the plan, setting priorities, monitoring metrics, coaching team members and delivering performance reviews.
The purpose of listing each leadership Seat’s roles is to clarify accountability. Traditional org charts, which list titles alone, only tell part of the story. You’re creating clarity around expectations by listing the five roles for each Seat.
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With your company’s leadership structure clear and roles for each leadership position defined, it still can be challenging to put people in the right seats. The “easy button” response is to put your existing team in the seats they occupy currently. Resist the urge to take the easy way out. Think about the greater good for your company and what it really needs to grow.
For someone to occupy a seat, they must:
They firmly understand what the job requires, with guidance from the hiring manager.
It might be time for a change if someone is in a certain seat but fails to meet all three criteria for that seat. Reaching that conclusion and doing what’s best for your business may be challenging, especially if it becomes clear that a long-time, loyal employee isn’t a Right Seat.
Axcet HR Solutions, a professional employer organization, can help you make sure you hire the right person for the job to begin with, knowing that both your company and that individual will be happier when you’re able to get everyone “seated” correctly. Employees’ best fits are where they’ll be able to shine.
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With the ideal structure for your company clear, roles defined and leaders and managers in the right places, repeat the process for every department or team and, ultimately, for every Seat in your company. Once finished, you will have clarity in your org chart about what your company needs to grow in the near future.
Kyle Danner helped grow his family's printing company from $2 million to $18 million in revenue. He then made the difficult decision to leave it all behind. Now, Kyle helps business owners and their leadership teams clarify, simplify and achieve their vision using the Entrepreneurial Operating System®.
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