Organizational Structures & General Organization Importance in Business

According to the Wall Street Journal, office workers waste an average of 40% of their workday. “Not because they aren’t smart, but because they were never taught organizing skills to cope with the increasing workloads and demands.” With such a large number of individuals lacking organizational skills, it is crucial to have an organizational structure in your business and assure you have organizational skills in your life.

Different Organizational Structures in Business

An organizational structure determines how an organization is set up to deal with responsibilities, roles, decision-making, and who will report to who. Organizational structures are broken apart into two categories with the first one being Centralized versus Decentralized. This is also described as a vertical structure. Centralized is popular among businesses as this structure has a very clear chain of command and understanding of their roles, responsibilities, etc. Decentralized structures allow an individual in a business to have more independence in their group/team with their decisions and these individuals or teams may reach out to others within the business to further their work or goals. This structure may work well for a business that is constantly adapting and changing. THis structure may also be referred to as a flat structure. The other category of organizational structures is Hierarchical vs. Circular. The hierarchical structure is the most commonly seen in business with the triangle shape. With the triangle shape in mind, the top will be one person as the highest in command with each person falling under it having a supervisor. As you go further down, it leaves employees with less and less decision-making, responsibility, etc. A circular structure is similar but instead of that triangle shape, you’re looking at a circle where the next ‘ring’ is the next level of management. Although all organizational structures fall into these categories, there are many variations of these structures out there when deciding what suits your business best. To give you an idea and some examples of organizational structures; we’ve included a set of pictures below.

(All pictures credited to Forbes)

Why Organizational Structures are Beneficial

Having a clear organizational structure is important for many reasons. For starters, it allows everyone to have a clear understanding of their expectations and holds individuals accountable in their roles. Additionally, with everyone knowing their place in the organization, it can improve efficiency; especially as a business grows and every part of the organization becomes more specialized in what they’re doing. Depending on your organizational structure it may also encourage growth in employees and stimulate more collaboration throughout the organization.

Personal Organization is Vital

Being organized in the workplace can be just as important as your day to day life. First off, organization can help you to create a daily routine. Having a routine can allow you to be more comfortable and reduce feelings of stress and disarray in the workplace. Furthermore, this routine can aid in making you feel more prepared for each day; thus saving time as you don’t have to make as many decisions and already know what you need to do. Another way organization is beneficial is that it can improve work relationships. By being organized, you can spend less time honing in on deadlines and may have more time to attend work events or collaborating with your co-workers; therefore improving your work relationships. Good organization also fosters problem solving as it makes you realize possible problems before they become an issue. Organization can also combat stress from burnout, forgetfulness, and lack of time management.

Keeping everything organized can also be extremely valuable when it comes to the end of the year. Knowing where all your tax statements, receipts, and other important documents can save you additional stress and prevent wasting time searching for things that should have been filed away correctly throughout the year. Moreover, if your business gets audited, not having the appropriate documents can create more issues, cause unnecessary hassle, and may even cost you money. There are numerous other ways that organization can improve business that are not mentioned here – showing that organization is such an essential part of everyday life.

Organization & Organizational Structures are Paramount

Having a defined organizational structure in your business and ensuring you are organized in your life prevents extra stress, wasting needed time, and benefits you in many ways with productivity, good health, and much more!

Client Relationships – Working with Others

According to SBA (Small Business Administration), 99% of businesses in the US are small businesses and small businesses generate 44% of US economic activity. With so many small businesses around, working together can help everyone grow and flourish greatly!

What are the advantages to creating good client relationships?

In a study done by SuperOffice, 86% of customers will say their experiences are just as important as what services/products they purchased. If that is not enough to interest you, in the same study, they found that about 50% of customers make impulse purchases just from receiving a personalized service! All of this is just part of the benefits of having a good relationship with customers/clients. Other positives for creating good customer relationships include: improving customer loyalty, spreading awareness to your business (word of mouth reviews), and even increased sales.

How does one form a good client relationship?

There are many ways to create strong business/client relationships with the most obvious starting at being kind and having good communication. This could also look like staying positive for the client – if things are running behind or the client feels like something is challenging, you should always put your best foot forward and attempt to ease the client of any worries. Another way to forge a great client relationship is to remain open-minded and exceed expectations. This just means really consider what it is the client is looking for and make your best effort to accommodate those needs. Exceeding expectations doesn’t just mean going way above and beyond; it also means being realistic about timeframes and keeping up with client requests and/or questions. It is also important to note that good client relationships are formed through setting clear boundaries and both sides taking accountability. You want to be clear and consistent so the client doesn’t ever feel lost or blindsided at what is going on. Additionally, relationships are a two way street and if you are taking care of your side of things, it is just as vital the client is communicative for any questions you may have as well as any new updates from their side of things (like having to change the date for something or any new requirements for a project/service/etc).

Whether you are trying to deepen a client connection or you’re really trying to show a client you care, gifting them something is a great way to show that they are important to you. Giving them a gift sends a personal message and shows gratitude. Furthermore, gifts can spark conversation with others – which makes your company stand out, gain more attention, and keeps your company in the minds of others’. Finally, a gift is a good way to show some humanity. For some, the relationship with clients is all done through text, phone or video calls. By giving a gift, you are breaking away from all the digital communication a bit and creating a more personal connection.

Working with CJ Designs

We like the way that Christine Jarski, owner of CJ Dean Designs with Decorating Den Interiors, personalizes the customer experience. CJ Designs is a full service interior design company owned by Christine Jarski. She helps make interior designing fun and stress free by really taking the time to fully understand you, how you use your space, and the styles you love. As a professional in her field, her best piece of advice is to truly get to know the client as this is the most important part of every project. It allows the project to run more efficiently and really brings out the “Wow” factor every client is looking for. Christine works with a team of craftsmen and manufacturers, which allows her to create one-of-a-kind custom furniture and window treatments specifically designed for her clients. Additionally, many of the vendors she uses will use recycled materials and they have environmentally conscious production methods. As Christine says, “This allows us to create beautiful and impactful spaces that promote healthy living. My team and I have all the resources to carry out your project from beginning to end. The result is a beautiful and functional space that has been created just for you… A space that you love coming home to, that makes you smile every time you walk in the room.”

(A bedroom designed by CJ Designs)

With every business, you face highs and lows as the owner. Christine loves getting to know her clients really well and creating something special just for them. Also, since she works with Decorating Den Interiors, it allows her to have a network of fellow designers to work with and bounce ideas back and forth. In terms of the hard elements of owning a business, Christine finds managing all the different parts of a business difficult at times but is grateful she has outside help like us; and we are delighted to be working with her to handle the finances of her business! The last important thing Christine wants people to know about her business is, “Each project takes a team of professionals to implement. Having all of the resources in place, understanding the client and designing for them, and being professionally trained is what makes the outcome amazing.”

(A living room designed by CJ Designs)

We love working with other businesses!

By creating meaningful relationships with others, it helps your business maintain long-term relationships that everyone can benefit and thrive from. Working with people like Christine makes a great partnership for both parties. It helps everyone understand other aspects of the community around them and how they can help each other grow. Christine is a dedicated owner invested in her community and it is a daily reminder of why what we do at TAK is so important!

Financial Reports – P/L & Balance Sheet

When it comes to the world of accounting, some of the most common reports include the profit and loss report and the balance sheet. Whether you are working with someone or trying to figure out your finances on your own, knowing all about these reports can be beneficial to improving your finances.

What is a P/L and Balance Sheet Report?

A profit and loss (P/L) report can capture how much money you’re making (or losing) within a certain time period. (A month, quarterly, a year, etc.) A P/L report may also be known as an income statement, statement of earnings, or statement of operations. Some key components of a P/L report are revenue, cost of goods sold (COGS), Gross profit, Expenses, and Net profit(loss). Revenue is how much money you’ve made without including any COGS or expenses. COGS are the costs for your business to deliver goods and services. This includes things like materials, labor, and shipping. Gross profit is the money you’ve made by subtracting COGS from your Revenue. Expenses are split into two categories: Direct & Indirect. Direct expenses are typically COGS as they are the items needed to make/deliver the service. Indirect expenses include things like utilities, rent, and fuel. Indirect expenses will never be counted as COGS. Net profit is the remaining money after you have subtracted COGS & expenses from your revenue. Net profit would be the actual profit (or loss) for your business in said time period. nn The balance sheet is the overall financial position of the business. It shows what you owe as well as what you own. This is determined by assets and liabilities. An asset is something you own. There are two types of assets: Current and noncurrent. Current assets are anything that can be converted into cash within a year whereas noncurrent is anything that takes longer than a year. There are also current and noncurrent liabilities as well. With current liabilities being items due within a year and noncurrent due after a year.

How do these reports help me determine my finances? How do I use them effectively?

The P/L report is a clear way to see whether you have gained or lost money that month. Additionally, the P/L report allows you to see what expenses are costing more and see how often money is coming through. This is beneficial because it can make predicting future revenue trends more accurate, thus allowing you to budget better and stay on track with your goals. nn The balance sheet is helpful for quite a few reasons. For one, it can help you decide if you are able to expand your business by knowing if you can manage the money that floats in and out or if you need to focus on receiving more cash. Another way the balance sheet is useful is by helping the company see if they are prospering or failing. This can give way to a company changing its policies, correcting more mistakes, and refocusing its goals to better align with the state of the business. Additionally, the balance sheet is important to potential investors or those looking to buy your company because it allows them to see whether the business is worth the investment since you can see everything due, paid, and what the business is like without these things.

Financial reports are helpful

Although there are many ways to look at financials in a business, knowing the fundamentals of the P/L report and the balance sheet is a very helpful step in knowing the state of your business