Management Structure & the Personnel Manual 8

[vonsteimel]

Greetings,
I'm a Mechanical Engineer working for a small "Recreational Vehicle" manufacturer. We've got about 15 full-time employees and sell about 40-50 vehicles a year. Everything we build is make to order. We've been "in development" from about the early 70's up until the early 2000's. Our product has been developed & stabilized and the business is ready for expansion.

However, up to now we've been operating as a fabrication shop. We carry a heavy "fab shop" mentality thats more reminiscent of a retirement home than a manufacturing firm. -- Largely this is the fault of management, or the lack there-of.

Among other things, I've been trying to transform the company to a manufacturing mentality and away from fab-shop/retirement home state. One of the biggest problems is our complete lack of leadership. The management structure here is almost completely flat. There is the owner/president and then there is everyone else. Such a flat structure prevents the development of "teamwork" and does a great deal of damage to moral. It also prevents any real strategy from being implemented. In part, this is because the owner leaves much to be desired in terms of "people skills" and openly admits these faults.

There are 2 assumed managers in the factory (1 for assembly/fab & 1 for composites) but their roles are blurry and informal. We created a "chain of command" diagram several years ago but it was never followed. Now, after working with the owner, I've been tasked to do whats necessary to get things in shape. One of the first things I intend to do is reenact this "chain of command" and get it working. The owner has agreed to follow any such "structure" but will take some work to get it fully implemented. One of the pros of such "chain" is the reduction of people dealing with the owner, which will be limited to just a few managers. It then becomes much easier to foster a positive owner/manager relationship when only dealing with a few individuals. It also will act as a "check valve" to prevent the "poor people-skills" from flooding the factory & drowning moral.

My question is how should I "document" the Chain-of-command policy? The most significant change is its effect on communication, as now the "president" will be working only with a few upper managers instead of every individual employee. Those managers will then be responsible for implementing & maintaining whatever policies/strategies we decide to implement next.

So I figure the best way to start it is with a revision to the personnel manual(which would be more symbolic than anything), followed by individual employee reviews (which are due anyway) in which we can briefly discuss the changes & their role in it.

I've looked everywhere and I have yet to find a good example of a "management structure" being described in an employee handbook/personnel manual. Does anyone have any good examples? Otherwise, how does a company document the operation of its management structure and/or its communication chain?
Thanks,

VS

 

[berkshire]

Vonsteimel,
You say in your original post you have 15 people in the company.

"""There are 2 assumed managers in the factory (1 for assembly/fab & 1 for composites) but their roles are blurry and informal. We created a "chain of command" diagram several years ago but it was never followed. Now, after working with the owner, I've been tasked to do what’s necessary to get things in shape. One of the first things I intend to do is reenact this "chain of command" and get it working. The owner has agreed to follow any such "structure" but will take some work to get it fully implemented. One of the pros of such "chain" is the reduction of people dealing with the owner, which will be limited to just a few managers. It then becomes much easier to foster a positive owner/manager relationship when only dealing with a few individuals. It also will act as a "check valve" to prevent the "poor people-skills" from flooding the factory & drowning moral."""

With two "Managers" it would appear that no one manager has more than seven or eight people under him.
This would essentially make that person a group leader, or working foreman rather than a manager. A company of that size simply cannot afford more than one, or at the most two nonproductive personnel.
Adding layers of management to a company of that size would almost certainly guarantee its demise.
B.E.

The good engineer does not need to memorize every formula; he just needs to know where he can find them when he needs them. Old professor

 

[moltenmetal]

Fifteen people don't need another couple layers of management unless seven of them really need to be fired.

You can't organize the company now to have the structure it will need if it were to grow to 100 employees- it will be too top-heavy to survive the transition.

In my experience, a flat management structure works better to foster collaboration and teamwork than a hierarchical one does, as long as the size is limited and everyone is properly motivated.

You imply that the owner's inappropriate intervention and lack of people skills are the source of the problem. Only the owner can solve that problem. Even though they may admit to being the source of the problem in their quiet, saner moments, ownership will ultimately prevail and intervention by the owner is inevitable. The managers you intend to insert between the owner and the workers will therefore ultimately have responsibility without authority- the definition of destructive stress- and are therefore unlikely to be successful.

 

[patprimmer]

In my opinion, MM and BE are spot on.

Regards
Pat
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[vonsteimel]

There is basically only one layer of managment. You could call the owner the "second layer" i suppose, but everything is being setup to exclude the owner. The owner himself is only going to "check" the managers work & its effectiveness in the factory (aside from marketing). Once he is satisfied, he intends to take to the road to push our marketing (which is also very unique, but thats another discussion). --- and yes, the owner is well aware of this plan and openly agrees...

I should have mentioned that the factory is in 2 separate buildings. Composites fabrication in one and assembly/fabrication(basically everything except composites) in the other. So the idea of the 2 managers is 1 for each building. And then the office, in which we will appoint a "leader" i suppose you could call it. The difference being that the "factory managers" will no be taking on jobs themselves, but rather managing & helping everyone else with their job. Where as in the office, the "leader" will be doing their own work but will also be responsible for the functionality of the office as a whole. They will decide how to split the workload in the office & do the "fire-fighting" in the office, and ultimately be responsible for its performance.

It is going to be a flat structure, with only 1 layer of real managers. However, it is also going to be built-in that the current "bottom-level" factory employees will become managers of their area when we expand to that point. -- As I mentioned, all the factory employees are assigned a work-cell/bay. They are in-fact "bay managers", but they are not called such or else the whole factory would be made up of "managers" (which it is essentially).
So, say we have Joe doing all the engine build-ups & installations. (in reality he IS the manager of that engine bay. he is responsible for the entire engine bay and all that goes on there) When it gets to the point where Joe can no longer keep up with the demand for engines, we'll hire a new person & put put them under Joe. Now Joe is a manager) This will happen for each & every bay.

The newly appointed factory managers will walk around and ensure everyone manages their bay correctly. There main job will be to "jump-in" and help the bay-member before it becomes a bottle-neck. They will also be the ones "representing" their "building" when discussions or problems arise that require the owner.


Berkshire: The "managers" we have now are more team-leaders than managers. But the factory desperately needs managers for a number of reasons I'm not going to discuss here. The new "shift" will make these team-leaders into managers, giving them authority to change what needs to be changed but also holding them accountable for the factory performance.
Thanks,

VS

 

[lacajun]

VS, it's your job so you can structure it and document it as you see fit. There is no absolute correct answer. There is an answer that fits the company's needs or your needs, as the case may be. You decide. You don't like what you see or have found so do something new and fresh from your own desires. Welcome to management and business.

You need to understand each and every process required, real or imagined, to supply the company's RVs to the public, i.e., the company needs some process engineering to document responsibilities, establish your org chart, etc. I'm guessing people already know what their responsibilities are and who they communicate with and why because it's an established business. Have them write their own job description, since it's a small shop. This exercise might reveal some surprises. I wouldn't move forward without this exercise.

Each organization chart I've seen was in an employee handbook, with varying degrees of detail on job descriptions. Even with heavy amounts of documentation, companies still have trouble getting work done and a lot of other issues to varying degrees of sanity. Why? People.

What you are trying to accomplish is culture change and documentation saying what you want is only a small part of culture change. It takes years of very patiently working with people to accomplish it.

Who says the company is ready to expand? Market analysis? Stable product?

Your references to the retirement home mentality reveals a lot of where your thoughts wander. That will show to others. After you've been around for 40 years running a company, check your thoughts. ;-) The owner has accomplished a lot and has stuck with it for 40 years during some tough times. Some of the employees have probably stuck with him through those years.

As an observation, you state the complete lack of leadership but surely there is some leadership because they've been around for 40 years and managed to get RVs out the door and haven't been run out of business with defects returned by their customers. They've done quite a bit correctly.

If teamwork and morale are breaking down, it is not because of a flat structure in a company that size. Something else precipitates that.



Pamela K. Quillin, P.E.
Quillin Engineering, LLC

 

[controlsdude]

I was not going to waste my time on this one, but seems like everyone likes to hear what the immature xer says. Not for a laugh but to slam me, for some reason.

I have found 4 jobs in 4 years and landed at this big engineering firm that has these my goals/match corp goals.

1st - what a waste of time
2nd - have no choice but to make my goals match corp goals
3rd - I believe at end of year, I will get a good laugh where this exercise will be meaningless

Big Picture - boss thinks that I do a good job, and his boss thinks I do a good job, so what is the point of this exercise? I am clueless, think at end of year I will be slammed for not meeting their goals, just so they won't give me a nice payraise.

 

[GregLocock]

Wrong thread? He wrote, generously.

Cheers

Greg Locock


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[truckandbus]

For such a small company, documenting the chain of command shouldn't be necessary. At lunch have the owner say to all the employees 'if you have issues in bldg 1, talk to Tim; if you have issues in bldg 2, talk to Sue'.

After that, if someone comes to the owner with an issue in bldg 2, the owner brings Sue in to address the problem. This only needs to happen a few times before people will realize the owner will redirect the query to the correct person and they will end up talking to that person anyway. The only person needing the discipline will be the owner.

A word of caution - unless you are building 30-50 vehicles a WEEK, you ARE a job shop/fab shop. Don't invest in onerous processes that are not going to yield benefits.

 

[vonsteimel]

truckandbus, What you've just metioned "'if you have issues in bldg 1, talk to Tim; if you have issues in bldg 2, talk to Sue'." Is in-fact a chain of command. Yes, it is a very small chain of command but nevertheless, its a chain of command. There will also be formal titles and job description that will apply to the chain of command in what will be called "Roles & responsiblities". So this is another reason why we want an actual document showing the chain of command. These are "roles" are already assumed but aren't formal, which has lead to some misunderstanding and errors in the past. From this we'll also spec alternative "role members" so that if an individual is sick, locked-up or dies we'll have someone able to perform those tasks if needed.

Short of doing just as you've advised, I'm looking to do somthing more formal to help initiate the culture change that must follow. This is what the "personnel manual" was about. That more than just a verbal say-so is behind the new Chain of Command.

And also, it mainly pertains to information traveling down the chain of command rather than up. But it still applies both ways.

So far things are going well. A consensus has been gathered, from which a set of new changes were drafted. Everyone is very positive and hope it is the real change everyone is wishing for.
Thanks,

VS

 

[nuche1973]

From my experience when I started "solving company problems" I recommend you sit down and write two letters before you get started.

"I drank what?!" Socrates?