In more than thirty-five years experience leading and consulting with turnarounds and start-ups (turnarounds in the making), I have learned time and again that a brilliant product, service, or plan is no guarantee of success. In fact, it’s only the beginning; the test is in execution. There is a stage in between startup and mature companies that many companies are prone to fail. That is the ramp-up stage.
Here are several questions to ask yourself if you are leading such an organization. And while it is true that any startup or business about to explode will likely not have all their bases covered, you’d better have most of them in tow if you want to improve your chances for success.
What percentage of your employees would recommend your company as a place to work to others? Why would they? This same question can and should be asked and counted within every department. If the results are disappointing, coaching or replacing the manager should be a consideration. Once a team has lost confidence in its leader, it is almost impossible to restore it.
How experienced is your management team? This is never more important than when you are scaling up. So are your managers scaling up in concert? How do you know? The same skills required for both a start-up and mature organization can be different from a rapidly growing one. Be on the lookout for behaviors that are inconsistent with the organizational needs.
Are your managers solving or contributing in this order: the organization, their team, and last themselves? If not, they’ve got their priorities in the wrong place. And by the way, inexperienced managers tend to overspend and make too many allowances for their team and not the overall enterprise. This behavior eventually fails.
Are you or a trusted senior executive constantly on the prowl looking for problems? Or do you empower everyone to look? This can range from anything like long customer service waiting times to bottlenecks in information flows, to defective parts or disappointing service. When issues are identified are they completely resolved, and people or systems improved or do they recur? Do you learn of problems late in the stage?
Do you have enough organizational slack and sufficient cross-training as well as reasonably tested information systems so that you can quickly deal with large increases of workloads and problems as they occur? A business is its own ecosystem and problems in one area soon have a ripple effect upon the entire organization, the customers, and eventually the stockholders. Any problems in a startup will be magnified in a high growth mode. Your organization will typically be in a very visible make-or-break mode and this is not the time for massive makeovers or extensive remedial problem-solving.
Do you and your organization have and encourage a flexible mindset? The mindset that proved successful in the startup stage may be the wrong one in the ramp-it-up one. You may have to change strategies, vendors, channels, rules, personnel, products, targeted customers, training, etc., and maybe even everything. Do you encourage a free flow of ideas and information? Do you have healthy debates? Are functional departments territorial or collaborative? Are decisions second-guessed or rallied behind? Are you indecisive and prone to flip-flopping? The wise will keep their options open.
How is decision-making affected? In the startup mode you can usually make decisions and switch on a dime, but as you grow and attract more managers with strong opinions and healthy debate, you run the risk of creating uninspired compromise – decisions that inspire no one… and decision-making is more deliberate. Remember that the leader’s job is to make the most appropriate decision and not the most popular one.
The scaling or ramp-up phase typically implies that you have been discovered and have something valuable. You are no longer in the rapid try everything mode where mistakes go largely unnoticed and you can quickly correct. You are now focusing on something more permanent that must be sustainable, perhaps also create a competitive advantage and long-term growth as opposed to just proving your model and getting it into market. So how are your resources allocated between short-term metrics and long-term growth and competitive advantage?
How do you implement your mission? Typically your mission will seldom if ever change. Your strategy may change even annually with several major initiatives or projects. The key thing is focus, and not spread your focus too thin. As important as your projects identified are the ones omitted or not funded may be more critical. Trying to accomplish everything is a sure prescription for a gigantic corporate bellyache. Are you good at saying “no” and how often do you relook at your selection? Most importantly, by what measures and means do you track your projects and know whether or not you’ve been successful?
How do you communicate? How much time do you prepare for you communications? How do you measure their effectiveness? Does everyone know what is expected of them? Are you perceived as “walking the talk?” How do you know that? Are your associates clear on them and can they enunciate your vision? How are problems and new ideas communicated upwards? Could that method be improved?
It has been said that a CEO is like a bus driver. First, he must have a clear vision and plan as to how to get the bus to its destination in the best manner. Secondly, the leader must have the right people on the bus who are excited with the direction of the trip and work well together. Thirdly, the leader must have the tires, brakes, shocks, engine, etc. in good working order and sufficient fuel in the tank to take the bus to its destination. Consider yourself a glorified bus driver. In other words, is everyone aligned behind your strategic direction, do you have the right people, and enough funding to reach your objective?
Great Cultures are to Employees as Great Products are to Customers. Herb Kelleher and Southwest Airlines developed a philosophy from the onset that valued the employees over customers and stockholders. Based on a rigorous hiring program, he got the right people on board and treated them with modest pay, but wonderful incentives. That kind of compensation helped in attracting the right folks and eventually worked so well for the employees that they, in turn, delighted their customers and produced returns that paid off handsomely for the stockholders.
Is your company’s culture real or phony? Does it put your employees – all of them in the forefront? Do they feel inspired? And does your organization attract the ones best fit for you and repel the others?
You soon realize that these are not one-time only questions, but ones you will want to continue ask yourself as you enter the ramp-up stage.