Getting to “yes” with the founder

Founder's Mentality - Getting to "yes" with a founderOne of the most difficult things for a growing company to get right is how to “professionalize” while preserving the Founder’s MentalitySM. We’ve discussed in earlier blog posts two ways to strike the right balance: First, the founder must bring in the right professionals and work hard to integrate them into the insurgent culture. Second, the “professionalization agenda” must be shaped and driven by the company’s strategy, not pursued as an end in itself.

At a Developing Market 100 meeting in Mumbai recently, we co-created a third way for professionals and founders to get this right: The incoming professionals need to be clear about which type of founder they are dealing with and then figure out how best to channel and complement those skills—not conflict with them.

Too often, the relationship between the founder and a new professional breaks down because the founder eventually comes to the conclusion that the professional doesn’t “get it.” An outsider may be horrified by the seeming chaos that the founding team takes for granted. He or she might be put off by the founder’s unpredictable behavior or the way strategy is forged in the hallway. The professional ends up saying no a lot in an attempt to redirect seemingly random decisions into more predictable and systematic processes. Before long, the founder begins to view the professional as a hindrance—slowing decision making rather than improving it. The founder reacts by embracing chaos even more, the professional works harder to channel the chaos, the founder chafes and the organization spirals down in a doom loop.

In our experience, incoming professionals can help avert this kind of disaster by figuring out how to say yes to the founder more often. That requires paying close attention to two things:

  • Professionals need to gain the founder’s confidence by showing that they do, in fact, get it—they understand that speed is an insurgent company’s greatest asset and that chaos is sometimes the price of speed.
  • They also need to determine what the founder’s role has historically been at the company and how his or her skills and energy can be channeled in ways that leverage strengths and reduce the negative impacts of weaknesses.

In this context, we think a discussion of founder “types” is helpful. A clear understanding of the role the founder actually plays in the company can help professionals build an organization that complements it. In Mumbai, we used workshops to describe four archetypical roles that founders play:

  1. The founder as king. In this case, the founder started out as chief product developer, chief sales person or as head of the store. He or she was the original “unit of value creation,” meaning the founder made or sold the product and dealt directly with customers. Many years after launching the company, the founder remains the smartest person in the room when it comes to the core business and is a valuable fountain of advice. For this reason, the most important organizational question facing the company is likely how to scale the founder—specifically, how do you create more kings of the business? This often means trying to help the founder “let go” so new leaders have the time and space to develop. We met with a head of a construction company who is the perfect example of the founder as king. He started off working onsite as the company’s first project manager. Decades later he is supervising 10 other project managers. On the one hand, he is the best project manager in the company. On the other, he is learning to let go so his project managers have space to grow.
  2. The founder as court. Here, the founder has never been the king of the business. He or she might have devised the original insurgent mission but left the running of the unit of value creation to others. Typically a non-king founder is the head of the court, ensuring that the kings of the business have all they need and recruiting more kings as the business scales. We met the founder of one company, who had the vision to dominate the “good-enough” segment in a particular technology sector. He knew success would require building a great product-development team and he set about recruiting key engineers and building an environment that gave them the freedom to innovate. In recent years, he has concentrated on building the right team and making sure it stays focused on supporting the product developers. He clearly understands how to give the right time and space to the kings. What’s difficult for him is doing the same for the professionals he has brought into the court.
  3. The founder as integrator. Many founders are classic CEOs—they play the integrator role. They are neither king nor court (although they might have been either at some point). Instead they are there to integrate the recommendations of kings and court and keep the organization focused on the customer. Larry Page, in a recent interview between Vinod Khosla and the founders of Google, describes himself as “the integrator,” recognizing that his job is to make sure all the related pieces of Google fit together.
  4. The founder as creator of kingdoms. Many founders are serial creators. They have the business idea, they help empower the kings and they recruit the court to support the kings. But after that they are more interested in creating a new kingdom than in playing a major role in the initial one. We came across a classic example in Delhi when we met the founder of a services company dedicated to serving the poorest segments of society. His company’s rapid growth had shown that you could make money in this unlikely market, prompting more traditional competitors to rush in. While the founder was confident his management team would meet the challenge and continue to grow, he felt his energy was best spent creating another “new-to-world” business for India. “I know what I do best,” he said. “I create new markets. I’m not as good at running a company in an established market. I’m an entrepreneur. I’m not a good manager.” He was very clear that his job was to get out of the way of the kings and court in the current business. The potential danger, however, was that his shift in focus away from the core business could prove a distraction for the broader organization.

What might these archetypes tell you as a professional?

  • For founders as kings, the key is to channel the energy and skills of the founder into developing the next generation of kings. To earn the founder’s trust you must demonstrate you understand that the kings generate the value and the professionals’ role is to support the kings.
  • For founders as court, you should concentrate on demonstrating you are the founder’s partner in building a strong court that excels in supporting the kings. Professionals can’t compete with the founder’s role as head of court. But they can become the voice of the front line to ensure the court remains focused on what matters.
  • For founders as integrators, the key is to help the founder build out the core team of kings and court. In many ways this is the easiest role to deal with, as it takes advantage of what professionals can best provide.
  • For founders as creators of new kingdoms, you must help the founder channel his or her energies into creating new businesses, whether they reside within the existing corporate structure or in a new, separately owned start-up. The key challenge is to focus the CEO on building the new business without disrupting the old one.

Understanding the role of the founder will help professionals decide the best way they can support the business. It helps them learn to say yes more often and become a means—not an obstacle—to channeling the founder’s energy in positive directions. If professionals earn the reputation for blocking actions, they will quickly become part of the problem. And gradually, they will turn into energy vampires, condemning chaos from outside the castle walls but losing the right to cross the bridge and join the kings and court.

 

 

 

This entry was posted in The complexity doom loop, The paths to Great Repeatable Models by James Allen. Bookmark the permalink.

About James Allen

James Allen is a senior partner in Bain & Company's London office and recognized as a leading expert in developing global corporate and business unit strategy. He is co-head of Bain’s Global Strategy practice and a member of Bain & Company's European Consumer Products practice. He is co-author, with Chris Zook, of Repeatability (HBR Press, March 2012) and Profit from the Core (HBR Press, 2001 and 2010).

One thought on “Getting to “yes” with the founder

  1. Hi James,

    This is a really nice article on how “professional employees” should act in such a company.

    My own experience as a co-founder of a startup mirrored what you described almost to the letter. But it was difficult for me to accept decisions by the founder – when I felt the decisions were wrong. If you’re an employee, it’s easier to say ‘yes’ to the boss. When you’re a co-founder, the three lettered word “ego” creeps up.

    Could you also share your views on what should co-founders do?

    Warm regards,
    Arun

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