One of the biggest issues founders face is how to deal with the fact that revenue grows faster than talent (one of our westward winds). Usually, we’ve presented this problem as a recruitment issue: How do you add the right talent to your organization as you increase in scale?
But I just finished a meeting in Brazil with a founder who argued that this is not simply a question of adding new people, it’s also a matter of when and how to say goodbye to some of the original team. He argued that this was the single biggest issue on his plate right now and one that was absorbing a massive amount of emotional energy.
I’ll let him tell his story:
“We are a niche engineering firm, which we’ve run as a family for multiple generations . One of our strengths has been our ability to recruit great professionals over a multiple decades who have worked seamlessly with the founders. But now I’ve got a problem . My direct reports are fantastic ‘mission accomplished’ guys . I tell them what to do and two weeks later they walk back into my office and say ‘mission accomplished.’ By that time, I have new missions and so, after a quick pat on the back, I send them off again . These guys are amazing. I like tight control and I like giving very specific orders. And I like that I can trust them to leave my office, do something and come back saying ‘mission accomplished.’ That makes them happy and it makes me happy.
“However, we are a much bigger company now and I recognize that I can’t be the guy with all the ideas telling my direct reports to do this and do that. I need people with different skill sets today. I need business leaders who see a problem, figure out how to solve it, form the team and operate more independently. I need self-starters.
“My direct reports on my original team aren’t going to be able to change their stripes and start doing that. But they are my creation. They worked for a founder-owner and they didn’t learn the skills I now need because of the way I forced them to work. In that way, I haven’t done them any favors.
“So what do I do? How do I tell a friend of mine who has worked with me for 20 years that he is no longer right for the company? How do I explain that he lacks certain skills because I forced him to work one way and now need a guy who can work differently? How do I tell him he is not fit for purpose because of my management style? And by the way, this isn’t just about one of my direct reports—this issue involves about 60% of them.
“If this was just about me, the solution would be easy: I’d work more hours to make up for their issues. I owe them that. But this isn’t about just me. These guys aren’t providing the necessary leadership to their own direct reports. Unless I proactively come up with a mission, they are not mobilizing their teams. Everything they do is in reaction to my prompts and that just isn’t what we need anymore. I have 40-50 new managers who need leaders.”
As this founder’s experience shows, companies that grow from insurgency to leadership don’t just need new talent as they grow, they also need to figure out whether the people they brought with them on the initial journey are right for the next phase.
Sometimes, they are not. And often, ironically, that is because those people did everything the original founders asked them to do. Figuring out the fate of the “mission accomplished” team is often one of the most difficult issues a founder must face if he wants to take the company to the next stage.