Business Organizational Structure
Lean vs Large

Lean vs Large Business Structures

The business organizational structure whether you’re a new or growing business the question of size will arise.

What Is The Optimal Team Size?

When considering business team sizes there are many things to be considered one of them is Dunbar’s number which few are aware of.

Dunbar’s number came about as a result of Robin Dunbar’s1992 study of the brains of primates. He created a formula that accurately predicted the group size of primates based on their brain size. When he applied the formula to humans and compared it to history it also proved to be accurate.

In essence, Dunbar’s number suggests that the human brain also has a cognitive limit to the number of relationships that can effectively be maintained. When operating as part of a larger group that limit is up to 150 people. For smaller intimate groups that limit is up to 12 people.

History shows that even in intense situations like war the Roman Maniples contained around 160 men. Villages in the neolithic period had up to 150 members before they split into smaller villages. Beyond the 150 – 160 range it would have required too much social grooming and been too costly to maintain a group that was any larger.

Big business has long been aware of the challenges faced with large team sizes and the benefits of smaller teams.

Virgin head Richard Branson in his 1998 book Losing My Virginity states that “Convention also dictates that ‘big is beautiful’, but every time one of our ventures gets too big we divide it up into smaller units… The results for us have been terrific. By the time we sold Virgin Music in 1992, we had as many as fifty subsidiary record companies, and not one of them had more than sixty employees.”

Achieving Optimal Team Size

There is a myriad of options businesses can utilise to design and maintain an optimal team size.

One of the most important options is the use of apps. Increasingly apps are leveling the playing field for smaller businesses. Enabling small teams to leverage greater functionality, flexibility and reach across the business spectrum at minimal cost. It’s provided the ability to scale business performance while minimising the team size required to achieve it.

Often as a business grows the efficiency and effectiveness that apps produce can start to decrease. On the face of it, it may appear that it is a direct result of increasing volumes. That the solution is then to expand the team in response or it’s time to replace the app entirely.

Volume Often Highlights Underlying Issues

If the situation is carefully examined the drop in efficiency and effectiveness may not be a result of the app. It may be a result of how it was set up and how it is now being used.

Some of the common causes for this can be:

• When the app was initiated, the business did not at the time have mature business systems and processes in place.
• The team members or company setting up the app didn’t have an in-depth knowledge of the app and/or the business’s related systems and processes.
• Customisation of the app was not considered or available when the business started using the app.
• The app has not been reconfigured after other business systems have changed.

If an app is missing some of the functionality you now require. Rather than replacing the app entirely. An option is looking at other apps that have the specific functionality required that can integrate with your existing app.

The advantages of integrating an existing app with another app are:

• That business disruption is minimised.
• Less time is required to design how to use and set up the integrated app.
• Data does not need to be migrated over.
• Less data mapping is required.
• Less data testing is required.
• Minimises a short-term drop in team efficiency by not requiring the learn a whole new replacement app.

If you are looking to improve the processes in your business and not sure where to start.