When fulfilling entrepreneurial tasks, one comes across topics from time to time that do not belong to one’s core competence, but still need to be dealt with. A good example of this are legal requirements that affect one’s own entrepreneurial activities. Before recruiting colleagues start looking for login data for monster.de when the legal situation changes, the responsible manager should first ask himself what other options exist in principle.
The ghosts I (didn’t) call…
Legal requirements are also a nice example because they occur without (the majority of) entrepreneurs having any influence on them. Normally they do not make the work easier, in the very best case it runs maximally differently than up to now. Examples are the IFRS requirements for financial processes, the unbundling efforts of the German Federal Network Agency, or the „Posted Workers“ requirements for cross-border activities of the company’s own employees. What is needed here (in that order) is organization, processes and systems that will address this issue.
It is advisable to first analyze the new requirement a bit – what exactly is it about? Here you can already get very far with classic research. If you are really well positioned, you may even have an „Operation Development“ area where you dump the topic in and after a few days you get an initial analysis with costs, risk and time. What is always worthwhile is to see how the rest of the market is dealing with it. After all, especially in the case of legal changes, you are not the only one affected.
Take advantage of the fact that other companies have already invested time and resources to ask themselves exactly the same questions. Former colleagues in the relevant areas, strongly connected companies (formal or informal) or industry meetings are suitable places for this. This is also where you often find out details that you may not have thought of yourself. The presentations will rarely be consistent, but they will help you to get a first overview.
So now you have a clearer idea of what is coming up, and what others have done in your case. Now it’s on to decision preparation.
No time.
Let’s start with resources. After all, the most common response to a new issue from within the organization will be „we don’t have time for that.“ That includes the people involved, as well as the processes and systems needed.
If not, you are left with a few options to solve the resource problem for operations
- First, you can try to leverage potential in existing resources (reprioritization, alignment, improving efficiency).
- You can also file down the task a bit if necessary (there is 110% fulfillment or 80% fulfillment – depending on the context, this can already help a lot)
- You can source new resources (shared service or corporate site)
- You can bring in external support
So the options are many. Before you decide, however, you should still consider whether you want to perform this task at all.
Not my job!
This question is much more strategic because it doesn’t just refer to the fact that you need a few things that are suitable for the new job. Of course, the make or buy dilemma arises here as well, but from a slightly different perspective.
Imagine that you manufacture bicycles with 100 colleagues and someone comes around the corner with a legal requirement in finance for which you would have to reorganize your finance operations and build a new system. You will need a topic owner and depending on the coverage level in case of vacation and sickness 2-3 people to take over a part of the task. You will need task definitions and processes between functions. Last but not least, you will probably want to map the new process in IT, which in turn creates requirements there as well.
All human resources will want to be trained (if the resources are available) or found in the market, at a time when many other companies are probably facing the same legal requirements. Processes and systems want to be defined, developed and implemented.
Now your purchasing department makes you aware that there are a number of partners out there who can offer you support for this new requirement cheaply via well-defined SLAs in the operational process. Cheap because they have entire departments that do nothing but just that.
And now imagine a similar situation, only in a company that offers financial services on the market instead of bicycles with 100 consultants.
What if?
You probably already guessed it, it’s all about core competencies. If you plan to become the world’s best provider of financial consulting services, then it is certainly worthwhile to make organizational changes (e.g. by creating a new division) and to acquire the necessary resources in-house. Depending on the type of activity, the question may also arise here as to whether you hire the new colleagues with a highly complex and very engineering-like task at your own location, or rather give a well-documented and standardized task to your own shared service center in the near-shore.
If, however, you actually see your knowledge advantage over your competitors more in bicycle construction, then it is not normally worth bending your own organization too much.
Then it may make more sense to look for an established partner in the market for your operations. One that offers you well defined interfaces and SLA. A partner that allows you to buy and pay for its services on a volume basis without having to make any start-up investments (apart from the implementation project). This requires a little effort (keyword: tender), but at least you can be sure that you didn’t just blindly buy the solution.
As you can see, if a topic is coming your way that needs to be taken care of, it is worthwhile to objectively check if it has to be you who personally dedicates yourself to the topic.
We wish you continued success,
