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Work Breakdown

© Bert Markgraf

So the orders are rolling in and you can't keep up. Traditionally, you hire a secretary. Now you're an employer. A few months later, the forms are piling up, the tax and benefit accounts haven't been set up, you don't have your company number and you're getting nasty letters from various government agencies so you hire an accountant/administrator. Now you don't have enough income to pay for these two so you hire a salesman. A year later you're bankrupt. You read this and some of my previous articles and you say, "aha, I should have used contract workers." Well, yes, but there's more to it than that.

Modern project management uses a powerful technique called work breakdown to disassemble the complex project into small, easily handled tasks. To use contract workers effectively, you must know what to put in the contract. Applying the work breakdown technique means treating your business as a project.

Breaking down the project into small tasks is done on a "work breakdown structure." The goal is represented by a box at the top of the page. Below are boxes representing the main tasks that have to be accomplished to achieve the goal. Below each box are further boxes or lists of respective tasks. Have a look at a work breakdown structure.

Let's say your goal is to increase gross revenue by $500,000 in the coming year. That would be your top box. On the second level might be boxes representing planning, an increased marketing effort, increased production and increased administration. Under the "increased marketing" box you might have advertising, direct mail, telephone calls and promotions. Under "direct mail" you could have generation of records, preparation of the database, mailing and follow-up.

When you've done this breakdown for all tasks, you're ready to decide what to give out to contract workers. The whole "direct mail" box can easily be farmed out. Keep the stuff you like to do and the tasks involving personal contact with your customers. Get rid of as much as possible using the work breakdown tasks as the basis for the contracts. Keep the task representing the result of an activity as your check that the contract has been completed. Use the work breakdown structure to track progress.

The above link shows you a computer program which can generate work breakdown structures but you can just as easily draw vague shapes on a scrap of paper. The purpose of the work breakdown structure is to have a planning tool which lets you organize your thoughts in a systematic way to achieve a desired result.

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