What separates a riot or a mob of people from a business? What separates a bunch of biological sludge from an operating healthy body?

It’s organisation. You can have the same substances or the same people, but if they’re not organised, you get dramatically different results.

Why have an organisation anyway? Unless you want to be a single-man or single-woman band, you should get interested in the subject of organisation. Sure, some people think it’s much easier if you do everything yourself, but the problems with this start as the business grows.

There’s only so much work one person can do. You may be the best at every role (which I highly doubt). Even if you’re a very effective person, you will hit a point where you make mistakes, lose track of tasks, or have no life other than working—unless you get organised.

Organisation derives from the term “organ,” which derives from the Greek word meaning "tool for making or doing". By definition, an organisation is a collection of specialised tools which work together as a whole.

For example, you wouldn’t want your stomach cells trying to do the thinking. That’s your brain’s job. You wouldn’t have efficiency if your stomach tried to think—it would just want to eat all the time.

Likewise, if your mouth—meant for eating—tried to see, you’d have to lick everything. It would be highly inefficient, and no one would appreciate that.

Specialisation is necessary as an organism grows and becomes more complex. Organisation leads to greater speed and efficiency in doing work.

It’s no different in your business. There are functions that must exist in every business for it to be successful. They exist whether it’s a one-person, 50-person, 100-person, or one-million-person organisation.

When every organ in your body does its job well, in unison with the rest, it’s a magnificent thing. We call that health—a vibrant, lively organisation. It can move quickly, react to challenges, and handle what it needs to handle. 

It’s the same in a business:

All functions defined

People doing those functions as a specialty

Coordinating together as a whole

Unified by an master plan and direction

If you have the above, a business will grow. It can't help it. You can't stop it.

This organisation will deliver great results to its clients and gain word-of-mouth. It will get more done with less effort. It will be profitable, and create stability for its owners and staff. That’s the ideal.

An organising chart isn’t a diagram you create and file away on a server. All staff should know it.

An organising chart isn’t a diagram you create and file away on a server. All staff should know it.

Staff should know where they are on the chart, who they report to, who reports to them, what their role is, what their output is.

When work comes in, people know exactly what to do with it. They know who does it and who doesn't do it. More work gets done. Less things drop through the cracks.

Imagine if a bill came in and it went to the receptionist, then to the salesperson, then to the tradesperson (plumber), and only then to the accounts person. Tremendous waste of time. Multiply that over a week or a month or year.

It’s the same if a plumbing question went to the Accounts Department. You wouldn't get much plumbing done—or at best, it would take a long time. Even if the accounts person could answer the question, they’re not doing accounting while they’re answering plumbing queries. It all adds up to profit drain.

I can’t cover everything in one article, but here are some tips:

1. Don’t organise your business around the people you currently have. Organise it around what you’re there to do, the outputs you’re trying to achieve, and the functions that must exist. Then, put people into those functions.

Many try to organise their org chart around people—to work around certain personalities. This always leads to inefficiencies, affects profits, and generates more work for the internal team.

2. Start with:

1. What are we trying to do? What’s the purpose of the entire activity?
2. What are the functions needed?
3. What things come in (work, requests, information), and what has to happen to them?
4. What are the outputs?
5. Once you know the workflow, you can work out the duties and roles. Those roles group into similar functions—sales and marketing in one area, accounts and billing in another, production in another, and so on. Just like organs in a body, these have to be connected and coordinated to achieve the final result.

A good organisation chart is based on functions and outputs. The relationship between each department or division should be clear. Anyone should be able to look at it and see who does what, and where each function fits.

The chart should also show who’s in charge of what, who reports to whom, and which roles are subordinate or senior. This establishes your command structure and responsibilities.

A good chart drives accountability and performance. People know exactly what they’re meant to do. There’s nowhere to hide, and greater clarity means people perform better naturally.

If you don’t have an org chart, you’re doing your staff and your customers a disservice. Once you’ve worked out your workflows, combine them into functions, assign the roles, and clarify who’s in charge, you can have a very effective team.

Creating an org chart is time-consuming, but it’s worth it.

I recommend having it physically on a wall and digitally in your systems. When new staff join, make sure they’re added to the chart right away so they see where they fit and can start learning the ropes.

Without an organising chart, you’ll find up to two-thirds of your team's activities become wasteful. Activity that doesn’t lead to value, profit, or billable outcomes.

Everyone feels better when their activities are valuable and effective. If you want a high performing team which generates more profits… organise it.

Click here to find out about the other five modules of the Ideal Life Business Program.