Create effective Business Units in your organization
1. Create effective Business Units in your organization!
In my first article I mentioned that all big organizations have to become flexible in
order to find their pace and become competitive. I concluded that the employees
have to develop/gain:
Flexibility, Ownership, entrepreneurial spirit & fair game skills!
The next step for the organization is to build its effective Business Units which will
operate as the cells in our body.
Different cells have different jobs to do. Groups of different types of cells make up
the organs in our body, such as our heart, liver, or lungs. Each organ has its own job
to do, but all organs work together to maintain our body. A group of different organs
working together to do a job makes up a system. All the systems in our body are like
members of a team whose job it is to keep us alive and healthy.
In the same way the members of a business unit in a company should operate.
More specifically, if we assume that a FMCG company has 4 different product
categories (Tissue products, diapers, feminine care products, adult care products)
each category should have a Unit manager, marketing people (depending on the
turnover of the category), finance manager and a sales coordinator. The organization
chart could look like that
CEO
Business unit
Mng 1
Mkg
Finance
Sales
Business Unit
Mng 2
Mkg
Finance
Sales
Business Unit
Mng 3
Mkg
Finance
sales
Business Unit
Mng 4
Mkg
Finance
Sales
CFO HR
Sales director
Sales force Logistics & Planning
2. The CEO has7 directreports,CFO,SalesDirector,HR & 4 BusinessUnitManagers.Theybuild
the Visionof the companyand agree on the company’sstrategies.Eachspecificunitshall
have each ownKPI’s& budget tohandle while the expensesare plannedbasedonthe unit
strategies.
The salescoordinatorof each unitcommunicatestothe widersharedsalesforce the
strategies&objectivesof the UNIT, the plannograms etc. whichare agreedwiththe sales
director.
The finance managerbuildsthe planof hisunit,whichisalsoagreedwiththe CFO
The forecastprocess takesplace ineach BU, while there isasharedteam of planning&
logistics,which buildsthe plan withthe cooperationof eachFinance manager.
The HR directorhasas mainresponsibility the developmentof eachmemberof the company
basedon continuoustrainingand the designof hiscareerpath.The rotationof the
employeestodifferentpositionsin - betweenthe differentunitsisanecessitywhichhasto
be implementedevery3yearsas part of the training& development.
Concluding,this way of structuringacompanybuildsunitsworkingindependently as
separate cells,while its memberacquiresownership,flexibility&entrepreneurial skills.The
total group of cellscreate the widerorganization whichcanhave ahealthy andlongterm
growth.