Honoring Organizational Relationships

Entrepreneurs are often used to doing  mostly everything themselves when they start their businesses. As they grow the organization, Entrepreneurs should build a structure with people in key functional positions and clearly defined supervisor-subordinate relationships.

Due to their founding the company and established informal relationships with initially hired employees (could be friends),  Entrepreneurs sometimes bypass the established organizational relationships and direct such employees at lower levels. This also encourages these employees in turn to bypass their supervisors and deal directly with the Entrepreneur or CEO.

Emergencies and critical decisions necessitate a breakdown in the organizational hierarchy. However,  organizational structure and the established supervisor-subordinate relationships need to be maintained to facilitate people to “Do the Right Things” and build companies for long-term growth .

This does not imply that Entrepreneurs should not maintain informal, leader-follower relationships at all levels in the organization. Instead, Entrepreneurs should cultivate an environment where the key management team and supervisors are the decision makers within their sphere of responsibility instead of relying on or promoting all significant decisions to be made by the Entrepreneur or CEO by bypassing formal relationships.

Ravi Patel

www.patelCFOservices.com

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Published in: on February 19, 2013 at 4:48 am  Leave a Comment  
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