THE CONSEQUENCES OF GETTING THE WRONG INFRASTRUCTURE
No, we’re not talking here about your company’s office or building structure, or its drainage system – Infrastructure Management (IM) is how companies organize the essential components to make their organisation work – people, processes, policies, equipment and data. Call it the virtual plumbing and wiring of the business
It’s crucial to set up a business infrastructure plan in the early days of a company:
- It establishes roles, responsibilities, authority, focus, and control within the organization.
- It determines the tone of a company – how innovative or bureaucratic an organization will be.
- It defines the process of how things get done in the company
- It establishes what areas should be outsourced and what should remain in house.
- It determines how well people work, and how well they work together, including outsourced resources.
- It turns disparate components into one fully-functioning, profitable organisation.
With a good infrastructure plan, information flows smoothly through clearly defined channels; everyone knows what their job is and how to do it.
It almost goes without saying that the consequences of NOT having a clearly defined infrastructure means there will be an element of chaos in the running of the company to a greater or lesser degree.
In the case of a recruitment start up, there are some serious issues to consider – with a dynamic new business, the sales team will be adding clients, contractors and billable hours at an exponential rate. Without good scaleable systems you will be left with the following potential scenarios:
- The back office playing catch up with sales which is likely to cause friction.
- When the business really takes off, there will be bits of paper everywhere and nothing is reconciled.
- As time goes by and business grows further, so will the problems and they will be costly in terms of man hours to fix.
- Morale will be low amongst the staff because few people like working in chaos (however ‘organised’ they may claim it to be!) and will resent fire-fighting.
To avoid these issues, you can take the following actions:
- From the outset address accountancy issues – for example, contractors need robust IT systems for time sheets to be logged, and payments to be made. Enlist the services of an accountant well-versed in recruitment.
- Business taxes: talk early on with your accountant in order to maximise your profits and have help with cash-flow issues. They will advise whether invoice discounting or factoring would give you the breathing space you need and enable you to grow.
- Research laws related to advertising for employees. You may find it beneficial to engage the services of a firm of solicitors well versed in such matters.
- Staff welfare – don’t be afraid to take advice from an on-line HR support company, particularly if your business is with contractors. If you do not want to use an on-line solution set up spreadsheets to enable you to keep track of staff absences and holidays – data that can be fed into your payroll easily.
In summary, you wouldn’t put up for long with insufficient wiring or dodgy plumbing in your home or office; doesn’t your business deserve the same treatment?