How important is an organizational chart to a team?
When coach Brian Kelly got to Louisiana State University in 2021 after taking charge of football operations from the prior regime, one of his first questions to the remaining LSU staff?
“Where’s your org chart?”
They didn’t have one.
No one knew who reported to whom and no one knew or could identify specific job descriptions or responsibilities.
The LSU football program was in shambles less than two years after a 15-0 national championship season in 2019 with a 5-5 finish in 2020 and a 6-7 follow-up in 2021. At the end of the 2021 season, they had 39 scholarship players. (NCAA Division I football teams are allowed 85).
In one Spring semester, with an entirely new staff save one holdover and the equipment staff, Kelly reorganized the football program’s entire infrastructure and constructed a thorough organizational chart with reporting mechanisms that established clearly defined roles and responsibilities. Players, coaches, and support staff now have regular performance evaluations. Everyone gets evaluated. Everything gets measured. Everyone knows their job responsibilities, and everyone knows what to expect every day.
Once Kelly had harnessed every available resource, his organization hit the recruiting trail and had an initial 10-4 campaign which culminated in an SEC West Division Championship, a regular reason win over the University of Alabama, a trip to the SEC Championship game, and a resounding 63-7 Citrus Bowl win over Purdue University.
Well-run business operations take the same approach. Organizational charts are living breathing organisms that tell a story & require regular editing. What gets measured gets done and having an accurate and flexible organizational chart provides a business with a true understanding of who does what, when, how, where, and why. In addition, a well-developed and clearly defined org chart maximizes immediate and long-term growth potential, minimizes downtime, and significantly reduces the likelihood of mistakes.
When it’s time to go to market, a thoroughly built organizational chart allows potential buyers to connect with and understand your infrastructure and workflow. The more accurate and current, the more valuable your operation looks. Buyers are willing to pay more for businesses that have strong infrastructures with fewer immediate challenges to resolve. Strong infrastructures built with people who clearly understand their job responsibilities, provide teammate support, and have solid communication with the management team are more productive, happier, and stay together long term.
What should be included in a complete organizational chart? Tenure, position, responsibilities, etc. are critical pieces of information necessary to establish a foundation. In addition, potential buyers will want to understand promotability, how well everyone gets along, who makes up your management team, are your best people in leadership positions, do they learn well, are reliable, who has prior industry experience, where are the productivity logjams, where does workflow operate most efficiently and effectively, etc… A professional org chart is a map to unlock those stories. Valuable infrastructures assign personnel specific tasks and responsibilities. Everyone knows what everyone else is doing. A clearly defined and thorough organizational chart opens up honest, forthright, transparent, and clear communication. Open communication clears the channel for insight, innovation, creativity, positive productivity, and significant company growth.
Our objective is the same as yours. Maximize the total business value by the time you’re ready to go to market and take care of the people who make it happen. Regular and continuous budgeting, planning, costing, and estimating oversight are critical components of any successful business operation. See the investment banking professionals today at S&P Capital Partners for your complementary valuation and business trajectory review.
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