Organizational discipline makes good companies great!
Growth brings challenges that only 2 out of 10 organizations are able to meet, the rest as we know from various reports, perish. Like everyone owning a scalpel is not a doctor, not every money-making machine knows how to handle scale. Expansion is not only a capital expression, it is much more than that.
Technology has evolved to a stage at which augmenting large teams is not essential to control both quantity and quality of the delivery. Instagram, makes multiple billion dollars with a handful of people. The point is that companies do not need large groups of people as much as they need processes to make their aspiration of becoming BIG, to come to fruition.
Organizations need to at some point stop being communes in which everyone is doing everything, shun the impossibly addictive cool vibe of a university fest and get down to the serious work of building specialization, routines and rituals because scale demands discipline, rigour and managerial depth. It is one thing to have a great carpenter paint the wall and quite another to have a painter put colours on the wall. With the same set of equipment, raw material and environmental setting both the carpenter and the painter are very likely to produce widely different results.
I hope you catch my drift. Let’s now get down to the business of categorizing a few things that corporations should adopt when they plan to grow big.
1. Create high talent density in your organization, bring in experts and give them not just responsibility but also authority to make changes. Average people simply can’t create spectacular results.
We illustrated with an example how the mere act of painting a wall can be done differently by an expert and someone who attempts it without prior knowledge of the task. Building on that idea, what the organization needs is to build top-tier leadership at each work unit level.
- You need to hire a department leader for all competencies; for run of the mill operations to Product to finance to human resources. Competency building gives best results when it begins from the top.
- There is a very strong urge to continue with the existing staff, rewarding their loyalties over the years with leadership positions in the organization. Well, the thought is sound emotionally, it is not so tractically or even fiscally responsible. If the need to bring in experts is being felt so urgently that people are being hunted/onboarded, then separating from the urge to make things happen from the people you’re familiar working with, will have to be given up in the interest of creating specialization which is crucial for growth.
- Source the best talent that is there in the market for the money that you have to offer for the role. Do not settle for ⅗, you need ⅘ to win this.
- Set clear expectations.
- Give them authority to make changes that they deem fit.
- Hold them accountable for results.
- Get out of their way, do not second guess their judgement at every turn.
- Set interdepartmental expectations and routines.
- Monitor results closely without creating an environment of micromanagement. Micromanagement is counterproductive.
2. Get out of the project mode and get into creating departmental organizational capabilities.
- Organizations in their early stages adopt project mindset, in which every piece of work is reviewed for its scope, a set of people are identified for the job and then the task is project managed either by the founders themselves or by the 2nd rung of leaders.
- The problem with this approach is that while it gives the leaders a sense of control and also illusion of speed, it breaks the organization’s ability to carry things through with sustained rigger. As a result everything started with high energy gets dropped with the same alacrity. You’ll notice too many projects dying in the credal.
- This is not the most optimal approach to adopt when gunning for growth, what you need to do are the following.
- Break organizational goals into department wise goals.
- Department goals into work unit goals.
- Work unit goals into individual KRA.
- Set targets and timelines.
- Review performance, ruthlessly.
- Upon finishing the setting up of the departments.
- Set up interdepartmental SLAs.
- Work instructions.
- Collaboration rules.
- Now when you start a project, do not select people, instead.
- Create the objective charter and activity list.
- Have the competency/department leader from the respective depatment allocate resources.
- Have a non partisan program manager run the thing professionally.
3.Build a Merit-based performance management system.
- Objectivity makes a performance management system worth its salt.
- Put everything behind, get absolutely robotic about measuring progress.
- Numbers based.
- Commitment Vs Delivery.
- Target Vs Delivery.
- Let the best argument win.
- Create sensible consequence management systems.
- How do you deal with non performance?
- How do you deal with slow progress?
- Ways to deal with failed experiments and failed staff members.
- Give the performance management system legitimacy by not making any decision outside the system.
- Get absolutely transparent.
5.Create clear financial goals and budgets, down to each work unit of the organization.
- At the end of the day, all organizations are in the game to make money. Therefore, it is important to segregate costs department wise as well.
- Divide the organization budget into all departments.
- Give them their targets of both spending and earning.
- Lead with DOA.
- Keep health checks in place.
- Review meticulously.
- Own all the exceptions centrally but all the routine must be decentralized.
5.Set up innovation goals guided towards improving the efficiency and effectiveness of the organization.
- Innovations and ideation are important livers of growth. Foster a thinking organization.
- Set up the practise for it.
- Institutionalize methods to gauge participation in the organization.
- Set up a formal process review wing and task them with the following.
- Creating a leaner process.
- Identifying automation opportunities.
- Reducing cycle time.
- Improving accuracy.
- The idea is to create an organization that is inherently interested in finding newer ways of doing things, better ways of doing things.
- Less resource intensive, more accurate and faster completion of a job is the better way of doing things.
- Frugality is a virtue that you’d like to instill in the organization because throwing money at a problem has been proven to not solve anything.
6.Set tolerances for failures.
- Do not glamourise failure. When I say this I do not mean to sound like an old disciplinarian, who just can’t see beyond errors and fixates much more on what might have gone wrong than things that might have worked. Experimentation is needed to find a better way and the hard fact of life is that 8 out of 10 experiments do fail. So it is ok to fail.
- But at the same time, you have to ensure that it does not become fashionable within your organization to carry out experiments just for the heck of it, secured in the knowledge that there is high tolerance for failure.
- Reward worthy failures and at the same time penalize all projects that should not have been attempted or must not have failed.
Building an organization is incredibly daunting; it requires more than blood and sweat. If you’ve existed for more than a few years you have indeed made it. You should know that growing your baby so that it gets into the next league of existence is going to be unbelievably strenuous. You’ll need to unlearn and relearn every aspect of your business. You’ll need to learn to trust those who join you on the journey.
Growth does not happen overnight and it certainly does not happen without the growth mindset. So my advice to you is to give yourself completely to the cause and God willing you’d succeed.
I hope reading this article has been a good use of your time?
Feel free to share your thoughts and views with me at [email protected]
Thanks for your time and have a wonderful day ahead.
Until next time, good luck with your expansion plans.