Startup challenges and how they can differ from large companies: Decision Making

Having a ‘Steve Jobs-like’ founder with more of an autocratic style of management can obviously have its pros and cons. But one of the real benefits of this personality–led organization is a simplified decision making process – since it is very clear who the decision maker is and what their decision is. This clarity makes it very easy to align the organization around a common goal and reduces the amount of thrashing that can go on debating what the decision should be. Not everyone will agree all the time with the decision and people might quietly continue questioning it, but the benefit of having a final decision made and moving forward is quite beneficial to an organization.

I’ve worked at or been involved with several startups in which the company did not have a single founder who controlled most of the major decision making. Instead there were leadership teams  with distributed power who worked together to make decisions.  The two main issues I have seen in startups of a reasonable size are either  1) dragged out decisions or worse, 2) decisions that were continually re-opened after they were made.

Over my career I have seen the ingredients that go into good decision making. They consist of three key elements:  a good process, data/information and teamwork.  Big companies use some form of RACI, which stands for Responsible, Approver, Consult, Inform and is used to clearly define team member roles.  By knowing which position to play and acting as a subject matter expert, the team can function more effectively; especially when the right data is presented to facilitate a decision.


Agreement & Commitment

Once a decision is made there are two components:  Agreement and Commitment.  Usually getting some form of agreement is possible for most well-organized teams. But the challenges I have seen is where there is passive-aggressive behavior by some team members. Someone who says they agree in a meeting, but then takes steps afterwards to either re-open or torpedo the decision because they didn’t really agree.  This situation is pretty common where there are strong personalities and divergent opinions about the direction of a company, business unit or product.  These types of behaviors are killer for a startup, they can handicap the entire organization when there isn’t true commitment to decisions that have been made. The amount of lost productivity and wasted energy used to further debate the decision has an incredibly negative primary and secondary effect on an organization. Everything from just lost time, to reducing engagement of quality employees who realize what is happening.

A specific example from a past company is when our product team had made a decision on how a specific feature was to be built. However, the engineer who ‘owned’ that module of the  product did not really agree with what should be built, so he just built it the way he wanted to without telling anyone until he was finished. Needless to say when he showed off his works the entire product team was surprised at what he done. Now, to give him credit, there were elements to what he built which had some merit and would have enhanced the original agreed-upon features. But instead we got a little bit of ‘right’ to go with a lot of ‘wrong’.  Somehow the product team needed to do a better job of both listening to the engineer to improve the final decision which incorporated his ideas. This engineer was top-notch.  However his team skills were not up to par. The engineer shared some responsibility in not committing to the decision and finding ways to share his ideas.


What to do?

So how do you handle repeated inefficient decision making in a startup? First, make sure the basics described above are in place. If the issues persist, ‘how decisions are made’ becomes a leadership and management issue.  Look at the people on the team and determine if there is a teamwork issue.  Are people playing their position?  In young companies, it is not unusual for leadership not to have a lot management experience and training. It is very possible that someone just doesn’t realize that they are overstepping their bounds in how they try to affect the direction of the company.

My experience has been that some people just fundamentally disagree with the direction that the team is taking and they use their power to subvert decisions and drive their own agenda. This is poison to a startup and people like this, no matter how talented, tenured or experienced they need to either be straightened out quickly or asked to leave. As my first manager at Procter & Gamble told me, it doesn’t matter how brilliant a musician someone is, if  the whole band is marching in one direction and they want to go in another, you gotta let them go.

Startup Challenges – Deep Experiential Training

It took me a while to write this post because I wanted to cram so many thoughts and ideas into it and could not find a good framework for it all to make sense. Finally I settled on two organizing thoughts:

  • What kinds of skills and experience should you want to get at a company?
  • How should you develop these skills?

These two questions are related to my recent posts about startup challenges.  At a large company these two questions are much easier to answer since they tend to have somewhat-defined career paths. But if you are just starting your career and joining a startup there is no handbook that you get when you start out with a track for you to follow. The following is intended for people who have a goal to reach a high-level role in their career, whether it is a VP or CXO role, or for someone who strives to achieve a high level of responsibility and manage large teams.

What kinds of skills and experience should you want to get at a company?

As I look back on my career, I think about the various sets of skills I developed and I have bundled them into three groups:

1. What’s Important Skills

This is basically a re-adaptation of the ‘What Counts Factors’ framework I learned at Procter & Gamble.  It was basically a set of 7 or 8 skills that all employees are looked upon to demonstrate and perform at a continually improving level throughout their career.  As you can see these are fundamental abilities that can be applied to just about any role and is not functional specific:

  • Leadership
  • Problem Solving
  • Creativity
  • Team Work
  • Communication
  • Priority Setting
  • Initiative
  • (Technical Skills)

Many large companies have centers of excellence with specific training courses and leaders to help you continually improve on each of these skills.


 2. Functional Skills

This refers to developing a deep, core set of technical skills required to be successful in a role. If you are a computer programmer or a marketer, there is a huge breadth and depth of knowledge and experience required to master a particular function.  When you meet someone who has mastered a function, you know it right away by their ability to go into depth about just about any topic related to that function.  Not only does becoming a functional expert include understanding the foundational and traditional attributes of a function, but it also includes being familiar with the latest methods and innovative tools that are currently being adopted and have become new standards.  Example in marketing would be social media and online marketing tools. In computer programming it would be open source toolkits and mobile app development. Becoming a functional expert is critical to achieving a high level with a large amount responsibility within an organization.

Similar to going to school, many large organizations have various training opportunities to develop a breadth of knowledge and experience in a function.

3.       Performance Management & Career Development

Having solid performance management experience means both receiving great feedback from your manager and includes having your work evaluated against a tangible process and framework.  On top of being on the receiving end of this process, you should also be given an opportunity to manage others and giving performance-related feedback relatively early in your career.  While having direct reports is more ideal sooner than later, managing the performance of others does not necessarily mean having people reporting up to you, it could also include cross-functional teammates with whom you are their ‘customer’.

Learning how to develop your own performance and skill and then developing a career plan help with self-awareness and career satisfaction.  Helping others improve their results and manager their career path are critical skills to have as both a leader and a manager. This also includes discussion about future roles and levels of responsibility employees are seeking and other developmental opportunities needed to achieve both company and individual success. It is amazing how few organizations have processes and training on such a foundational set of skills.


How should you develop these skills?

The challenge in going to work at a startup early in your career is that there is a very good probability that you will not get good exposure to the three groups of skills and experiences above.  The focus and first priority for a startup is not to develop great talent, it is to grow and scale the company.  Now this doesn’t mean employees aren’t important nor that you can’t grow and develop within a startup, I am just saying that creating these training and development programs is usually not a priority early on in a young company’s life. If you are a computer programmer and never learned some best practices in coding it is very likely you are creating engineering debt for your organization that will need to be addressed at a later date. Learning the proper way to be a functional expert early in your career will be catalyst to your success.

So here are some thoughts on how to acquire these critical skills and experiences early in your startup career.

1.       Find great managers and mentors to work with

It doesn’t matter what size organization you work for, if you have a great manager who has deep knowledge and expertise you will learn a lot and improve your own skills. The key is to find several such leaders within the same organization that you can learn from.  No single manager will have demonstrate all the attributes you will want to acquire, so you need to plan on finding other sources to help supplement both within your current role and as you plan your next career move.


2.       Read a lot… learn your discipline

Don’t just learn how to do your job. Depending on your educational background you may or may not have had formal, academic training in your area of work. If you haven’t it is becoming of you to find the top books, articles, online tools and thought leaders in your field to learn the breadth and depth of your function.


3.       Take on different roles  

If you work in online marketing don’t just do a role which is about data analytics, also take on roles related to uncovering customer insights by talking to customers, or working on new distribution channels.  These days I see many young people who have become experts in a single aspect of their function but have tremendous difficulty extending themselves to other areas within their function. This myopic skill set really limits their career potential and their role flexibility.

If you are in Brand Management at a large CPG companies, the experience is a bit of an apprenticeship. Over the course of 3-5 years an employee in brand management will typically work on several brands in different categories with different managers, functional experts and outside agencies.  For example some brands are more advertising focused versus trade/retailer focused vs. R&D focused. This upward spiral of roles exposes brand managers to a variety of experiences to round them out as they develop into a true brand manager.

Not all startups give you the opportunity to change roles after a period of one to two years based on organizational size and needs. You might be the only person who knows how to do your job and the company may not want to move you. These are important factors to consider when working at a startup and whether or not the company is a good fit for your career.

This posting was based on my experience working with many startup employees who have not demonstrated the same level of well-rounded skill sets as others who started their careers working for larger companies.  I am not saying that you cannot develop these skills working at a startup, however, the effort (and sometimes luck) required to gain those talents and be successful using them is non-trivial and requires a thoughtful career path strategy.

Startup challenges and how they can differ from large companies: Team Work

In a two-person startup, roles and responsibilities are pretty straightforward.  Figuring out ownership, decision-making and how to manage projects from start to finish is almost a no-brainer.  For five years it has been pretty clear between John and me what each of us is responsible for and how we make decisions.  What typically happens is we might not realizing we missed something until we are done and then go back and address it (wishing we had realized it sooner). Now once a startup has found product-market fit it is probably time to grow the team to cover all these bases, go faster and make sure nothing gets missed along the way.

Clearly as the company grows not everything can be done by just two people, so new resources are brought on board.  Most of the time these new people will be hired in some area of functional expertise whether it is engineering, product management, sales, operations etc.  These people will allow the team to divide and conquer the different operational elements that drive the company’s success as the company tries to scale.

The challenge is that as the organization and product team grows, the amount of information flow, decision-making and synchronization of work becomes much more complicated.  This becomes even more apparent as different layers of management start to get created thus creating updates and decision making conversations occur at multiple levels. For example a product team can develop their point-of-view about a new release amongst themselves, but then need to review it with the founder, CTO, VP of Product Management etc. for final approval.  This is the kind of multi-stage team work that doesn’t exist in a tiny startup.  If you were one of the first employees of a startup this new amount of complexity in getting a product to market could be frustrating.

In fact, in my career I have seen that most people aren’t used to thinking end-to-end when dealing with a large team trying to get a big initiative into market.

Now I am going to use the dreaded ‘Process’ word.

It really drives me crazy when someone talks about there being too much ‘process’ at a company.  Process is usually just a symptom or an outcome. And in fact most of the time having a defined process for your go-to-market initiatives is critical.

Now I will grant you that as a company grows they tend to become more risk averse which then requires Legal, Regulatory and HR folks to become involved (the lawyers will tell you it’s to protect the assets of the company).  I can’t really argue that these types of added steps in a process aren’t causes of frustration.  Each company is different in terms of how much overhead they require from these functional groups. But this post is really referring to the core functions in a Go-To-Market project, some type of inititative that affects the main business operations of a startup.

What I have seen quite a bit (and occasionally been guilty of myself) are team members who do not think ‘end-to-end’ when working on a highly cross-functional team project.  For a variety of reasons, they focus primarily on their area of responsibility and have blind spots to other areas of the functional aspects of project.  An example is when product management decides to build a feature in a certain way which reduces the ability for Marketing or Sales to drive more revenue.  Or vice-versa where marketing ‘needs’ a particular feature for a release but it will come at the expense of other important user features.

As a company and its teams grow, complexity naturally increases.  More meetings start to take place, more sub-teams go off and work on specific issues and ‘report back’ to the main team.  Clarity of decision making responsibility becomes fuzzy unless special effort is made to define everyone’s role.

Team work in a growing startup is hard. Without using too many sports analogies, not everyone knows how to play their position.  Some people care more about themselves than the team.  Some people aren’t good at compromising and negotiating to strike the proper balance for the better overall good of the team than just their area of responsibility.  Some folks just completely ignore certain stakeholders on the team. And at a very basic level, some people aren’t comfortable with the amount of communication and interpersonal relationships necessary within a team environment.


Now here’s the interesting thing.  All the elements I just described about team work manifest themselves in a process to enable the team to perform at a high level. That is the only way to coordinate an important intiative and get it to market on time. There are more meetings, presentations, multi-functional decisions and collaborative compromises that these new processes are used to address.

In a big company, this amount of team work is absolutely necessary. And in well-run organizations not only do folks learn how to effectively work in large teams, they can also understand why the different steps in the process are (occasionally frustrating, but) necessary.

In a growing startup when I hear about people complaining that they long for the ‘old days’ when there wasn’t as much ‘process’ or ‘we don’t need no stinking process’,  I basically think to myself ‘here is someone who does not like to work in large teams’.