Hello friends! Another nub here! Question: Startup business hierarchy?

[MrMoolz]

Want to say hello and hopefully starting out with a question is okay.

Searching through small business forums this one seemed fairly active.

I am starting up my own small business. I of course plan to expand over time.

I have all my plans and ideas set out but I am not familiar with what kind of hierarchy I should have in place to start. I am starting with two people (One who is my brother.) My business is dealing in education and entertainment. I have registered my business as me being the sole proprietor. This is my baby so I want a structure in place to delegate protocol and policy.

I hope this is enough information for the advice I need and I much appreciate it.

Thanks.

[vangogh]

Welcome to the forum MrMoolz. Glad you found us and thanks for joining the community.

As for your question, my first thought is to wonder if you need a hierarchy. If you're a sole proprietor then you're the the boss. With only 2 employees, I'm not sure what other hierarchy you'd need. I'm guessing that you want your brother to be a little higher up the chain than your other employee due to your relationship. Is that right? If that's the case I think it's more family thing than a business thing.

If on the other hand you're thinking more for when you expand and hire more people, I think I'd cross that bridge when you get to it. For now you're the boss and you get to delegate everything. There really isn't a need to structure things beyond that at the moment and it'll make clear this is your business. When the time comes to hire more, your 2 current employees will naturally be higher up in the hierarchy simply because they'll have experience. You can give them titles at that point.

My guess is the business won't need a hierarchy until either you can't manage everyone on your own or it gets large enough so it makes sense to have different departments. If it's the former you'll probably need one or two people directly under you to manage everyone and if it's the latter I'd let the business needs set the structure. Each department gets a department head kind of thing.

Hope that helps and again welcome.

[David Hunter]

Welcome, MrMoolz!

What's the role of your brother and the other employee in your business?

[KristineS]

As you said, it's your baby, so you're the boss. I think that's all the hierarchy you need at this point. If there's just two of you to start, it seems like it should be as simple as sitting down and clarifying who has what responsibilities and design making power and taking it from there.

[MrMoolz]

Wow. What wonderful answers. I feel like I should be paying for this advice, lol.

To address vangogh, I lean to the point you made in your second paragraph. That this is for when I do expand but also to make clear from the get go what the pecking order is. My inquiry amounts to the age old adage, "Never hire family." lol.

When I started this you can understand that I had the best intentions, and bringing a family member in who shared my passion is a big asset. But then it turns to the point of the personality type of that family member. To ignore etiquette and a line of respect that should be assumed when being asked in on something that the personality type has a penchant all their life of over quickly over stepping their bounds. If you get what I'm trying to put delicately here, heh.

So a line in the sand has to be drawn for me as these assumptions by said family member start to quickly spiral out of control to the point that said family member thinks THEY'RE in the drivers seat and start falling off the path predetermined.

This also leads to a desire for me to draw up a binding agreement and outline all this.

Your other information is also very valuable and what I was looking for. :)

So what say you?

David Hunter: The role of my brother is collaborative right now. It's pretty close to a partnership in that area but there is a lot I have outlined already he is quickly over stepping which lead me to seek this forum out and ask for experienced help. These things never end well ..

KristineS: Which is precisely what I plan to do. :) Am seeking advice from you wonderful people as to the best approach.

Thanks all very very much!

[vangogh]

Glad we could help. I can completely understand about family. I don't think working with family is automatically bad. It's more than you have a personal relationship and sometimes it can be hard to separate that from the business relationship. It can be a delicate line to walk. I think for now just make clear you're the boss. If you feel the need to spell it out some way do it. Mostly it'll really be about you acting in control. If someone gets out of line make sure you deal with it quickly in a way that makes clear you're in charge.

The pecking order will come about less from a document and more from how you run things on a day to day basis.

[David Hunter]

Definitely have an agreement written out and signed by all parties.

Also, I'll be happy to send you an invoice. Haha :-P

[MrMoolz]

lol! I did end up spelling it out and it went better than I could have imagined. I feel as I grow now, nothing will be assumed and that's a pretty good feeling. Now "acting the boss" shouldn't come with preconceived notions of "Huge ego".

Thanks again pals. Great forum!

Now please except my imaginary payment of ..

1 Billion Dollars.
470

[David Hunter]

Hahahaha!!! Dr. Evil!!!

[DennisChang]

Welcome to the forum! I think for a start you may wanna have some simple rules and regulations for the employees to avoid any potential conflicts since it is difficult to draw a line between personal and business issues when working with family members. For example, who has final say in which area, what kind of expenses can be claimed, etc.