The Lost Engines of Growth

FM-Wheel-engine-v02All leaders constantly must address the growth paradox: Growth creates complexity, and complexity kills growth. In these blogs, we have talked a lot about the first half of that paradox—that is, how growth creates complexity. We’ve highlighted how companies gain from the benefits of their new size as they grow—including scale and scope advantage, market power and influence—but lose their Founder’s Mentality. And we’ve examined the organizational costs of this loss—namely, speed, employee engagement and clarity about which talent matters.

In the next couple blogs, though, we’re going to focus specifically on the second half of the paradox—that is, how complexity kills growth—by discussing what we call the “lost engines of growth.” Below are the three engines we see companies losing most often. Continue reading

Insurgents and customer loyalty

nps-podcast-220x207We use the word “insurgents” to define companies with strong Founder’s Mentality, because those companies are literally at war with their industries on behalf of underserved customers. They’re on a mission to give customers better service or better products, or both. That’s why the company exists and why an obsession with the front line is one of the key elements of the Founder’s Mentality. Losing touch with the voices from the front line is one of the biggest risks insurgents face as they scale.

Recently, I talked about this on a podcast with my colleague Rob Markey, who is just as obsessed with customers and the front line as any company founder. Rob is a leading expert on customer loyalty and the coauthor, with Fred Reichheld, of The Ultimate Question 2.0—the definitive book on the Net Promoter System®. Continue reading

Bus No. 4: Keeping the insurgency alive

BusHow do founders keep the insurgency alive in their organizations? This question was at the heart of our 19th DM100 meeting, held in Johannesburg, and the conversation benefited from the experiences of two extraordinary former occupants of Bus No. 4.

It turns out that Adrian Gore, the founder and CEO of Discovery, and Robbie Brozin, the founder of Nando’s, shared the same bus to the King David School as kids. (For the record, both of them wanted to point out that Robbie was somewhat older!) Thank goodness for that bus driver—he had in his care the future founders of two South African companies that ultimately went global and illustrate how founders keep the insurgency alive as the company scales. Continue reading

Six lessons from the hardest job on the “court”

stopDuring our two months of workshops exploring how large, incumbent companies can regain their Founder’s Mentality, we spent a lot of time talking about the importance of defining your “kings” (those most accountable for delivering your customer promise) and the “court” (those whose primary goal should be to support the kings). As we’ve written many times in this blog, clarity of this sort ensures that the whole organization is customer focused, either directly or indirectly. Continue reading

Chocolates, radishes and the energy vampires

Small garden radishI know … you’re probably thinking I chose the title of this post by throwing a handful of those little word magnets against our fridge. Close, but not quite. Actually, I’m reading Charles Duhigg’s book, The Power of Habit, and he cites a study on willpower that I think applies to our work on the Founder’s Mentality®, particularly regarding the twin dangers of increased complexity and the rise of the “energy vampire.”  His story supplies the chocolates and radishes. I supply the energy vampire. Continue reading

Future makers vs. future takers: Long-term thinking

The long viewThe notion of future maker vs. future taker is a mindset issue. It is the difference between seeing the future as a good thing, filled with disruptive innovation that will extend your mission, or seeing it as a bad thing, filled with disruptions that will only upset your current market share and profitability. Typically, insurgent companies view themselves as future makers; incumbents gradually come to behave like future takers. As we discussed in a previous post, this can lead to radical differences in how a company views innovation. In this post, I want to talk about how it affects long-term thinking. Continue reading

The power in a bowl of M&M’s

Founder's Mentality - The power of M&M'sThe story of heavy-metal band Van Halen and the brown M&M’s is legend in rock-and-roll circles. But in the hands of authors Dan and Chip Heath, it has also become surprisingly relevant for business leaders.

As the story goes, Van Halen had a food rider in its contract demanding that a bowl of M&M’s candy—with all the brown ones removed—be placed in the band’s dressing room. The clause quickly became emblematic of celebrity excess (especially given the band’s reputation for bad behavior). Continue reading