I was working recently with a online business that has grown very fast. Many of the leaders have grown with it and find themselves at a relatively young age leading a multi-billion dollar business.
Whilst they are all very proud of the success of the business, they are also aware that it has changed radically around them. One of their biggest frustrations is that now everything seemed to take so long.
One of them, thinking back to their early days, told me it seems to take longer to get things done now they have 10,000 people than when they only had 25. How can this be?
Of course, part of this is viewing the past through “rose tinted glasses”. I suspect the things they were trying to achieve with 25 people were of a much smaller scale and lower level of complexity then the things they are trying to achieve today as a multi-billion dollar business.
However, it’s a fair question. One of my previous books “Speed Lead” looked at how success can make you slow. The book came out of working with many fast-growing technology companies in the 1990s. Many were making the transition from smaller organisations doing cool new stuff into larger organisations where the disciplined roll-out of products and services at scale was the key challenge.
As you add more complexity to your business and you add more people it gets harder to get things done. There is a cost to collaboration with more people involved in meetings and decisions and a higher level of inertia to change.
There is also usually a period where the reality of the business requires discipline, but the self-image of the business still values entrepreneurship and wants to behave as a start-up.
Unfortunately, when you reach a certain scale, not everyone can make decisions and not everyone can be involved in everything. It’s a difficult transition point as an organisation matures.
Of course, we want to retain what is best about being fast-moving and agile but, as we scale the business, investments become larger and decisions become more complex and costly. The trick lies in being really clear about where this adds value and trying to preserve agility in the areas where we can.
We can’t keep on operating the same way with 10,000 people as we did when we had 25. Ways of working need to evolve, jobs become more specialized and as we recruit more specialized people they bring more work with them – we may be doing things at a higher quality level or more professionally but we inevitably create more bureaucracy.
Whilst some of this is inevitable, a lot is not. At the same time as we become larger and more connected, we also need to be more selective about how we collaborate, control and decide. If we don’t do this there is a tendency towards increasing central control, slower decisions and to meet people being involved in teams and meetings.
Its also clear that if the limiting factor is people, the solution lies in their culture, skills and ways of working – not in structure or systems alone.
This is also challenge the senior leaders, their leadership style needs to evolve to recognize the new scale of the business. In a small business, they used to be involved in everything, if they continue this in a much larger business they risk micromanaging and dis-empowering their people.
As businesses mature they work out the areas where scale gives value and where agility is essential to flexibility and local competition. It takes time and is a rite of passage for successful organisations. The debate never goes away and the emphasis changes depending on business results and conditions.
It is their success so far that has earned them the right to grapple with these problems at a high level of complexity. If they are successful at this level, they will just unlock the next set of challenges in the game.