Keep a Tight Rein on Branch Operations

Posted on Friday, February 01, 2019

If your company has branch operations, or you're thinking about setting up satellite businesses, you need to take steps to avoid excessive departmentalization.

The more business you do outside of corporate headquarters, the more likely you are to run into competition among the satellite operations. Moreover, branches can differ in terms of morale, business culture and customer service. The results can be uncoordinated, and sometimes contradictory, decision-making.

All of this can be devastating to your bottom line unless you make the appropriate fixes. 

Here is a checklist of 10 steps you can print out that can help ensure that branch operations stick with the overall program:

Maintaining a Unified Vision

  1. Evaluate customer reaction to a new branch. Do existing customers still see the company as the owner? Do they feel that the change improved or hurt operations? Knowing the answers to these questions can help improve branch performance.
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  2. Teach employees the financial implications of their actions.  Make sure the general managers are focused on overall corporate success, rather than on their own division's performance. For example, one branch might do something that's good for its operations but damaging to the company as a whole.
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  3. Review company polices to make sure they aren't unwittingly promoting an emphasis on departmental profitability rather than company-wide profits.
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  4. Take a look at the technical skills at each branch to determine if there is any overlap that could be eliminated.
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  5. Look for operational redundancies at individual branches that could be handled more efficiently by the company, such as accounts payable and purchasing.
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  6. Make sure all branches are aware of the expertise of other branches and that managers are encouraged to share work. Consider financial incentives to motivate managers to pass work within the company.
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  7. Hold regular staff meetings to help ensure everyone is on the same page. Provide advance agendas, rules and time limits. Afterwards, evaluate the quality and timing of the meetings.
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  8. When timely decisions are necessary, make sure you have a process in place to gather and disseminate information so there's no delay in reaching a conclusion. Delays can cause paralysis.
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  9. Make sure that senior management interact with off-site employees to create a solid esprit de corps. Communicate a clear-cut management strategy throughout the company.
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  10. Clearly define the company's role in supporting the branches. Make sure there's no confusion about the quality and quantity of services provided. Let each operation know what corporate headquarters is doing to support the business so those activities are better appreciated. Make sure the types and degree of support are in sync with the branches' requirements.
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Posted in Tax Topics For Individuals, Tax And Accounting Topics For Business

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