Member Article

What Departments Should a Typical Company Have

One of the first concerns every new company has is the issue of hiring people. While some may think this to be fairly simple, it is anything but. The number of employees you need to hire is not the only thing you need to be preoccupied with, but the distribution of the employees, as well. We are talking about different departments, all performing various functions in the company. Each of them requires a different type of people, different equipment and finally a different number of people. Furthermore, not all of these departments are of core significance to your business, which means that you might even consider outsourcing some of them. With this in mind, here are few ideas on the departments a typical startup should have in its infancy, as well as some considerations on whether to do this in-house or to outsource it.

Production/Sales

The first thing every company needs are the people on core positions. We are talking about the production and sales departments. Here, you have employees producing and selling your product, which is a direct way in which your company generates profit. The number and proficiency of these people, is, therefore, in a direct correlation to your company’s earnings. This means that should your company increase its workload, they will be the first ones you will hire and should it decrease the first ones you will lay off. Needless to say, this needs to be done in-house (for the most part). In a case where you don’t believe the workload increase will stick, you might want to redirect a portion of your work someplace else.

Administration

Another thing that needs to be handled in-house is the administration of the company. The number of people in the administration depends on the amount of the workforce (see above) you have in your employ. Once your company starts expanding, you might even want to make a differentiation between the upper, middle and lower management. Here, you need to hire people with highly developed leadership skills. Aside from this, the motivation of your leaders might play a key role in increasing your company’s overall production.

IT Services

The next department that every company needs in 2017 consists of people in charge of your company’s IT services. Unfortunately, this is where things get tricky. Unlike those in production or sales, you can’t just hire anyone and then train them for this job, seeing how such a procedure would take years. Additionally, you would be forced to provide your IT team with adequate hardware and software, which could, yet again, cost you a fortune. Because of this, most startups and young companies usually choose to outsource their IT services to a company that specializes in them.

HR

Finally, every company needs human resources (HR) department. These people are in charge of recruitment, performance evaluations, benefits and compensation, safety and employee relations. As you can see, each of these functions is vital for your company, which makes the choice of outsourcing or not even harder. On one hand, you need someone experienced and trained in these matters. However, with present-day HR management software, it is possible for a single HR expert to take on the work of an entire department. From this perspective, it seems as if handling HR in-house might even be a viable option for young companies.

In Conclusion

The thing about outsourcing is that it is always cheaper in the short-run and more expensive in the long-run. Still, things are never as easy. You see, the level of proficiency of an in-house team will not be the same as that of a specialized company for quite a while. Furthermore, the price of hiring new people, purchasing additional equipment and training personnel in these skills might be more than an average startup can handle. Because of this, it is usually for the best to keep only the most vital functions in-house (production, sales and administration) and outsource all the rest.

This was posted in Bdaily's Members' News section by Blake Davies .