Operations and Administration
As any organization develops, it institutes work practices to accomplish the short term needs of the business. However, as organizations grow, they must transition from using these informal practices to more formal processes and procedures.
In emerging organizations, most of the working knowledge resides in the minds of the founders, or early employees, who are often jacks-of-all trades. On a daily basis, these individuals interact with customers, vendors, employees, and others as they develop the early foundation for the business.
The demands of a growing organization quickly exceed the ability of one or two people to conduct or manage all facets of the business. For a business to continue to grow, the informal operations and administration practices employed by the founders must be documented in a way that allows others to do the work with a high level of efficiency. The founders need to “download” all the information and nuances of their activities into written procedures that are easily understood by others. Using tools like procedural mapping and other managerial templates, organizations can turn informal business knowledge into documented systems and procedures that are not dependent upon any one individual.
Typically, the administrative tasks for operating the organization are the first things that are standardized to ensure that the organization is acting in a consistent fashion. The areas that an entity might focus on initially are: purchasing, shipping & receiving, accounting, customer service, payables/receivables, and sourcing.
In other words, as a company or business develops, it moves from a base of doing business that depends on “personal excellence” to one that depends on “system excellence”. How well a business accomplishes this transition will eventually determine its long term success.
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