Organizational Structures and Leadership Development

As contractors look at their organizational structures with an eye toward both sustainable growth and succession, they must balance the efficiency a functional area structure provides with the leadership development of a business unit structure.

D. Brown Management Profile Picture
Share

In a functional area structure, you avoid duplication of roles and individual functional areas such as estimating, purchasing, and field management are centralized. If executed effectively, this creates great efficiencies with the enabling bureaucracy required for scalability.

Succession: Organizational Structures and Leadership Development. A functional area organizational structure versus one aligned around business units down to a Project Manager. Levels of work including front-line execution, front-line supervision, process design and management, operations flow and integration, general business leadership. Stratified Systems Theory (SST).

For some contractors, it makes sense to break the business into smaller independent business units so broader general leadership skills can be developed and assessed. These individual business units are smaller and the job roles must be more fluid, which can be great for accelerating development and frustratingly messy at the same time.  

Just remember that compensation and accountability will not create competencies and both structures require deliberate development of the team.  

This is more challenging than we can cover in a short post. Please contact us if you want to further discuss the specifics of your organizational structure. 


Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Succession
Continue building value in your business, yourself and your key team members with a good succession strategy....

Leading Change Quote - Arthur Schopenhauer
If you see something that no one else sees you are either genius or crazy of some combination of the two. If what you see is so big that you can’t ignore it be prepared for a long journey through the process of change.
Incentive Compensation for Contractors - Audience Question: Higher Base Compensation?
There is absolutely no perfect ratio between base vs. incentive compensation. Here are the variables and some rules of thumb.
Opportunity Pipeline Target Size: The Basic Math
The biggest leading indicator for performance of a contractor is the size, quality, and trajectory of their opportunity pipeline. There are lots of nuances and complexity to evaluating your pipeline, but it all starts with the principles and basic math.