gazelles: 4 percent survive the transition from a small business to a growing firm
- the need for the executive team to grow as leaders In their abilities to delegate and predict
- the need for systems and structures to handle the complexity that comes with growth
- the need to navigate the increasingly tricky market dynamics that mark arrival in a larger marketplace
- Focus on your real job
- existing employees
- salary schedules, performance evaluations, information systems, and strategic-planning processes
- The Critical Number tells the entire corporation, day to day, whether there's profit headed for the bottom line
- [what type of data do we track? for what goal?]
- How do you keep everyone aligned and reading off the same page?
- Company’s top 5 and individual’s
- Top 5 and Top 1 to 5
- Themes for creating the focus and the fun
- a daily and weekly rhythm aimed at keeping everyone informed, aligned, and accountable makes a quarterly goal achievable
- Meeting everyday as a habit, routine work
- "Most architects think about designing a building. We decided that we're about designing a business, and then finding people that design the buildings - which, in our case, is mostly radio station buildings."
- growth decisions are dangerous if you don't have a good feel for what's going on both inside and outside the business.
- You have to understand where you are within your own industry and know that you've got everything handled before you try to step up to the next level, because a fall off the side of that mountain can be deadly,"
- “Now, when I think about how to grow the company, the key strategic question is, ’Who do I need to be, and what do I have to do to get there?’“
- lack of leadership (corresponding to #1)
- lack of systems and structures (corresponding to #2)
- lack of market dynamics (corresponding to #3)
- The two most important attributes of effective leaders are their abilities to predict and to delegate
- Predict: Be just minutes ahead of the market, competitions, and those they lead
- Delegate: delegation is a four-step process to pinpoint what they are to do, create a measurement system for monitoring progress, provide feedback, and then give out appropriately timed recognition and reward.
Considering structures, as the firm grows it becomes increasingly important to pay attention to organizational-structure issues. The key is to think in terms of three types of organizational charts.
- The first looks like what most of us know as the standard hierarchical organizational chart. I call it an accountability chart.
- The second type is actually a set of organizational charts that map work process or work flow.
- The third, the Almost Matrix, maps the relationships between organizational functions and the various business units that begin to form as the organization grows.
- Accountability charts
- two basic rules accompanying the creation of an accountability chart
- there can be no "to be determined’s" on the chart
- place the term "acting" in front of the title until it can be permanently filled
- there are always a few people in the organization who shouldn't be leading other people, yet are considered senior in the organization. [who are they? why they should not be leading?]
- two basic rules accompanying the creation of an accountability chart
- Work process charts
- four to nine work flow charts representing the critical processes that flow through the organization
- The processes might include:
- how you acquire a customer
- how a project moves through the organization
- how employees are selected and trained
- how customers are billed and payments collected
- Almost Matrix
- the relationships between organizational functions and the business units that form as the organization grows
- These units begin to feel and act like separate businesses within the business
- [Like client team and backend team?]
- [How do those charts look like?]
- Accountability charts
- under $10 million
- in revenue and just a little more focus internally on establishing healthy organizational habits would payoff in the long run, you have a tendency to focus mostly externally
- what its specific focus and position in the market should be. [what is it for us?]
- over $10 million
- the organizational complexity issues start drawing the attention of the senior team inward at a time when it's probably more important for the team to be focused more on the marketplace
- internal complexities increase, which cause costs to rise faster than revenue [is our system/organization scalable? Are we ready to hire more? Automated?]
- an organization is expected to have enough experience and position in the marketplace that it can accurately predict profitability
Wataru - this is awesome!