WHO’S WHO IN YOUR BUSINESS

Even the smallest business can have a hierarchy, a designation of power and responsibility as well a definition of roles within the business structure. While not all of the following may comprise your business today, they may become part of your company as it grows.

• Stakeholders and shareholders: Stakeholders are anyone with a vested interest in your business. Shareholders are stakeholders who have bought stock in your business.
• Board of directors: The board of directors makes sure the company is run profitably to provide return to shareholders.
  • Although an LLC, or limited liability company, shares some characteristics with a corporation, the requirement for a board of directors is not one of them. However, most state laws regarding an LLC’s management structure are flexible enough that an LLC could have a board of directors if LLC members so choose.
• Executives (C-suite executives): Top level people that operate the company, day to day and set strategy.  In a small business this position is usually held by the founder or founders.
• An advisory board is a body that provides non-binding strategic advice to the management of a corporation, organization, or foundation. The informal nature of an advisory board gives greater flexibility in structure and management compared to the Board of Directors.
  • I recommend that all businesses, regardless of size, form and use an advisory board.
• Employees: workers that carry out core tasks needed for the business to operate.
• A strategic alliance (also see strategic partnership) is an agreement between two or more parties to pursue a set of agreed upon objectives needed while remaining independent organizations. A strategic alliance will usually fall short of a legal partnership entity, agency, or corporate affiliate relationship.
  • This is often a more effective way of getting specific tasks done and less expensive than having full time staff.
• Consultant: Consultants go by many different names: coaches, mentors etc., and they all provide different skills and perform different functions. Some merely provide a “sounding board” function while others may help you develop the growth patterns necessary for success. We believe that having a consultant on board is one of the most important support elements that a business can have.

As a business grows it becomes more and more important for the owner to understand the structure that a company can have as well as who the players are in in other firms.

You don’t build a business. You build people and then people build the business.