It looks like you’re on a winner. The market loves your product, VCs are calling and you’re into your second round of funding. You’re hiring like crazy, you’re on the growth curve and the future is looking pretty damn good. Now there are new challenges, each one potent enough to kill the growth stone dead.
KILLER #1: A DEGENERATING CULTURE
“It’s not like it used to be when there were just 5 of us?”
Five people is different to 10 and 10 is vastly different to 100, so the working environment is naturally going to change with new people, new personalities and inevitably, a whole bunch of new behaviours. The culture of your enterprise is shifting and if you don’t act to manage it, things can and will degenerate quickly.
One of our good clients and friends, Nitro, a San Francisco-based Australian-founded start-up in the digital documents space, faced the challenge of a rapidly changing culture as they grew significantly and doubled headcount over the past two years. Fortunately, the company’s senior management saw this coming early on, realised the potential dangers, prepared accordingly, and then acted quickly to mitigate any risks.
They realised to get your culture right within a company, you must be deliberate in choosing the type of behaviours required for success. To help do this, Nitro established the ‘Nitro Way’, a handful of very specific statements that clearly lay out what each Nitronaut will and will not do in order to protect, develop, and nurture the company’s core values and culture.
Some examples of these statements include:
1.Performance and results always come first.
2.We do not tolerate bullshit.
3.We will not work in silos. Every team is critical to success.
4.We take our work seriously, but not ourselves (Work Smart, Play Hard).
5.We leave egos and baggage at the door.
6.We treat people with respect. Always.
In all, the Nitro Way includes 15 very specific statements around what the team “will” and “will not” do grouped under the company’s 3 Core Values: High Performance, No Bullshit, and Be Good.
The Nitro team first circulated the Nitro Way for feedback from its Leadership group, understanding correctly that unless the Leadership team is bought in and ‘living it’ daily, they would fail. Only then did they engage their Employee Experience function to set about ensuring this culture is embedded at all levels across the business. Now, from day one, each new Nitronaut knows exactly what is and what is not acceptable in terms of behaviour.
Company culture impacts everything. It impacts behaviour, the actions people take daily, the way they communicate and how they treat each other. It even influences the way people think and feel. More than anything, it has a direct impact on your ability to successfully execute strategy.
When you define a goal, objective or strategy there is a specific set of behaviours required to achieve a successful outcome. Act and behave in the wrong way and you fail. Get it right and success is yours.
So the first question a leader needs to ask is, “how do we need to behave in order to achieve our goal?”
KILLER #2: WASTED RESOURCES
“We just realised we’ve been working on the wrong thing for past 6 months.”
We recently watched as Senior Management of an IT start-up shut down two major development projects that their teams had been working on for the past six months and change course to focus all their resources in another area. You can imagine the challenge of dealing with the fallout.
You can do without a lot of things while growing a business, but money isn’t one of them, and with each round of funding comes an increased pressure to use that capital most effectively to drive growth. Waste it, and it will eventually kill you.
The biggest waste will come from not getting the most from your primary resource: your people. You cannot afford to squander their talent, time or effort.
The most important decision is often deciding what to STOP doing. This sounds easy but it’s not. Each project, each activity and even daily tasks need to be evaluated against the ‘win’ question: “will this help us win?” In other words, if we are engaged in anything that does not directly impact overall goals and objectives, we need to cut it out of the system immediately.
In short… every team needs to be absolutely clear on the answers to three questions:
1.How will we Measure Success? (Your Top 3 Measurable Goals)
2.What do we need to focus on to be successful? (3 Key initiatives – we call them High Return Activities)
3.What does each person in the team need to execute?
So, stop wasting resources. Be clear about what is expected from each team and each individual and then stop doing stuff that doesn’t count. In short: focus, focus, focus; delete, delete, delete.
KILLER #3: POOR EXECUTION
“We are months behind and the product is still not right.”
A business environment is dynamic and the ground is constantly shifting underneath your feet. In that type of environment you need to be disciplined and this is the most fundamental principle for start-ups in the growth phase.
Charles Darwin said it best:
“It is not the strongest of species that survive, nor the most intelligent, but the one most responsive to change.”
Building an execution discipline that allows you to handle change and still get the right things done involves just 3 things:
1.Be certain people are focused on the RIGHT things. Each person’s work needs to be clear and focused and in any given quarter, week or day be able to answer “what are the top 3 things I must execute now?”
2.Get visibility on performance. Visibility brings high levels of accountability. Both team and individual performance needs to be completely transparent and visible 24/7. You need to know precisely how each team and individual is performing, so it’s critical to set expectations and clear goals around execution and performance from the onset and then review progress regularly.
3.Build a team meeting discipline. Finally you have to build a sound meeting discipline that is focuses on the execution of strategy and improved performance. Execution is dynamic and things are always changing, so the only way to stay on top of executing your strategy successfully is to instill a weekly team meeting discipline that allows you and your team to thrive in this environment.
Success requires a finely balanced approach to all three killers. You can make the case that this is true for any enterprise, but in the highly pressured “limited resource” startup environment, all three are amplified ten fold and the dangers become immediate.
*Original Article: http://www.brw.com.au/p/entrepreneurs/others_start_nitro_killers_tell_SWcTrvpnx2QEm2upVtLDRJ