Think Enterprise, Do Startup…
Countries have different standards in classifying businesses, commonly known as large, medium and small. The latter two usually go together and form Small to Medium Enterprises abbreviated as SME. The classification is based on a number of factors such as revenue, number of employees, capital etc. But when you use the word “enterprise” you often unconsciously condition your mind to a more mature and structured organization. But if you refer to them as startups you condition your mind to think about smaller, younger and many a times non-profit making organizations. I am not implying that this statement is right or wrong, because we occasionally get trapped into this thinking. I have a different philosophy around this; it’s not how long the organization exists but how mature the leadership is. It could be an organization that existed for many years but if the maturity of their leadership is low then I call it “startup mindset” – I’m sure this is not new to some of you.
Let me now use the word enterprise for those organizations that have mature-thinking leadership. Because the tricky question is not how long the enterprise existed but how long the mature thinking existed within the organization. Let me clarify more. There are organizations that have been successful in making decent profits over the years, the founders having been in operation for many years, from the inception to-date employees and top-bottom lines have improved, but their thinking is not at enterprise level. It is more of survival or making more money without long term vision, lack of visionary leadership, lack of proper processes, lack of focus on knowledge base – and the list goes on. I must be very careful here, lack of processes does not mean you create a mountain of documents for the sake of showing maturity, it refers to the “right level” and of processes. This theory applies to all areas of the organization – the right level!
Let me bring the spotlight to another area that you unconsciously miss. When an organization moves from startup mode to enterprise mode there are a several “why’s” you need to find answers for. Why does the enterprise look for a new CEO? Why does the organization appoint new board members? Why does the organization require independent board members? Why does the organization look for partnerships? And why does it establish standards? One can obviously say it’s a sign of growth or maybe they want to win bigger deals. But truth is the organization now seeks for enterprise status – it seeks for vision and bigger and better challenges, they foresee competition. Here is where the new enterprise forgets the most important point, how you think-do business. In my view, it needs a clear transformation from startup-startup to enterprise-startup.
The CEO is the most critical factor in this model. In most enterprises, with its growth and maturity, the CEO often forgets the best of startup and worst of enterprise. For example, you build a lot of strategies and policies, introduce new standards and complex workflows, hire top executives and gate keepers. From its startup mode of “think fast, do fast” the CEO transforms it to “think smart, do cautious”, because there are a lot of complexities and workflows within enterprise. As stated before, I do not disagree creating the right level of processes and hierarchies. But a CEO needs to be careful not to kill the momentum, the energy and the dynamics of the enterprise. You will find a smart employee with an innovative idea waiting months to go through investment assessment cycles. Or an employee recommending changes to a painful and unproductive workflow waiting for a top tier consulting company to provide endorsement. Another example would be an effective manager who wants to do changes to a non-performing group of employees who expects a 5 year HR strategy from a newly hired HR leader. What is missing here now is the “think smart, do smart” culture. This can happen only when you create a healthy atmosphere that allows employees to think of the right solutions without having to worrying too much about structure and processes, as long as their thinking is aligned to organizational goals. This in turn enables them to execute their activities faster and with fewer errors. Doing faster with fewer errors is what the CEO and strategic leadership should focus on rather than creating a lot of processes, complexities and gate keeping. Many consultants are good at doing this for a higher fee but the employees within the enterprise know the best ways of doing it. It’s just that they may not be able to express it properly. As leaders, we should create that conducive environment where the new blood can mix with old blood for the “smart” way of doing, we should help people articulate the pain points and remedies. Leaders should strike a balance of using internal and external expertise.
Startups are faster in their thinking and operations. Usually enterprises are known for thinking the visionary way and operating cautiously. As leaders, our duty is not creating mountains of policies, bunkers or military police. Our most careful thought should be how to embed the enterprise way of thinking and the startup way of doing with higher quality. Today, the competition is prevalent in cyber based economies and the only way to grow in the current global conditions is to act smart (fast is one aspect of smart in my view).
Here, my saying goes – think enterprise, do startup.