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Five Ways Founders Stifle Business Growth
In the last part of this short series on founder's mojo, I mentioned that founders' most important job is to focus on their biggest business growth opportunities, but they're usually not doing this because they're wearing too many hats.
Past a certain stage of business, it's impossible for founders to effectively stay on top of all of the important functions in the four key dimensions of business - strategy, marketing, operations, and finance. What tends to happen is that they get stuck in operations - to use Michael Gerber's phrase on this one, they're working in the business, not on the business. Since all of their founder's mojo is consumed either by what they're working on in operations or by the switching costs of jumping from thing to thing, there's not much mojo left to tend to the other dimensions of business.
So, at precisely the time when founders should be asking the five critical strategic questions about their business, they're usually doing something else instead. In the worst cases, they're working on yesterday's business, and in the best cases, they're asking those critical questions but haven't yet put the right processes, systems, and people in place to help them address the answers to the questions.
To build a thriving, sustainable company, founders have to move from being the chief firefighter to being the chief future-builder. (Tweet this)
Most founders know where they need to go and know that they're stuck in the firefighting loop. Sometimes they don't know why they're stuck there, though, so the discussion below talks about the most common pattern I've observed.
#1: The Bootstrapper Mindset
Initiative and vision are two hallmark characteristics of bootstrappers. They're the kind of people who see that something needs to be done and don't wait around for someone else to do it.
This "I'm doing it because it needs to get done" mindset is absolutely essential for starting businesses. This mindset and a tolerance for uncertainty are what separate the people who start businesses from the people who've been thinking about starting a business for decades. (It's also the difference-maker between people who get promoted and people who hit a ceiling - while there is definitely a floor for bootstrappers, there is no ceiling.)
Over time, though, the healthy Bootstrapper Mindset turns into ...
#2: The Bootstrapper Habit
Eventually, bootstrappers stop thinking about what they're getting involved in because the mindset has turned into a stimulus-response habit. If something shows up on their action list, they start taking action.
As they continually take those actions, they build an efficiency curve with what they're doing. If initiative and vision are the seeds of founder's mojo, the founder's familiarity with and repetition of the foundational activities of the business are the water that makes it grow.
The downside to this efficiency curve, though, is that even when they start seeing that there's more to be done than they can do, founders don't start hiring and delegating, because their teammates are just so much slower than the founders, even after they've trained those teammates. Why spend all the time hiring someone and training someone only to have that person be a third as fast as you? (I get this one all the time.)
Let's just sidestep the fact that founders usually start businesses in a field in which they've already logged many of their 10,000 hours AND someone else probably trained them AND they've accrued more of those hours in the context of their own business. It's impossible for someone else to come in and perform at the level of the founder unless the founder hires someone who's doing something the founder doesn't know how to do. (More on this below.)
Bootstrappers see the world a certain way and forget that other people don't see the world that way, too. They're often rather frustrated to find that the people they hire need to be told what to do and, in the earlier stages of their employment, how to do it. Bootstrappers believe that people should just get hired and start doing what needs to be done because that's exactly what the bootstrappers would do.
Many founders dabble in hiring and find themselves quite disappointed. From their view, the people they hire are slow and lacking initiative. They therefore hire people only when it's absolutely necessary and for the minimal amount of time required for their teammates to do what they need to do.
Which leads to...
#3: Having to Sort Through the Bucket of Marbles
Let's imagine that founders' core tasks are a certain kind of marble in a bucket of myriad kinds of marbles. They need to see, process, and work with only one kind of marble in the bucket.
To get to those marbles, they have to dig around in all the other kinds of marbles. But since they have the bootstrapper habit, they see, process, and work on all the marbles. They're already there, after all - why not just go ahead and get it taken care of?
Even if they don't work on the other marbles, either they have to inhibit their natural impulse - and inhibition is the most taxing of the cognitive functions - or they have to wonder who's going to mess with all of the marbles and when they're going to do it. And if they're paying people, why are there so many damn marbles in the bucket in the first place?
These bootstrappers have yet to train their teammates to hand them the marbles they need to see OR train themselves to focus only on their own marbles. The primary reason they haven't trained their teammates boils down to ...
#4: Insufficient Trust
Although insufficient trust is #4 on the list, it's really the root cause of why so many businesses get stuck. Founders strangle the growth of their companies because they just won't let go -- they become behavioral control freaks even if they don't view themselves as such or even despise control freaks.
If founders don't understand founder's mojo, it's easy for them to distrust their teammates' ability to perform well. Most of their experience is with people who aren't as efficient and proactive as they are, because even if those people see what needs to be done, they don't know how to do it. They'd either have to spend a lot of time figuring it out or pay someone else to, which amounts to the same thing -- lost revenue. So, revenue is lost because the founder could be going out and getting more customers or funding, or because she has to pay someone else. Is all the effort of hiring, training, and supervising other people to do something the founder can do better really worth it?
Underneath all of this questioning of teammates’ actual or potential performance is that founders don't trust themselves. Did they build a business that will make it? Did they pick the right strategy, business model, and market? Are they actually going to be able to lead and pay people month to month? What if it doesn't work?
Inside the armor of confidence, resilience, gumption, and brilliance that founders don to get things done is a squishy human being who's battling shades of the demons we all face.
#5: The Value Crisis
"If I'm not involved in the day-to-day operations of the business, what will I do? What am I contributing to the business?"
I've heard these questions or variants of them quite a few times, too, and I've learned to prepare my clients for them as their business get close to Stage 4. The founders’ day-to-day experience slows down substantially because the people they've hired and the systems they've created are rapidly replacing them. Because most early-stage businesses are built via the Fred Flintstone method - for the business to grow faster, the founder's feet have to move faster - the founders' operating assumptions tell them that their moving slowly means that the business is moving slowly.
Once these founders slow down, they can start to think about things at a deeper level than they have before. They become aware that the kind of leadership that's required at the current stage of business is much different from what they've been delivering as a leader up to this point. They have to learn to work through people -- which means trusting more, leading more, and letting people do their jobs without interfering with them, even if the way someone's team goes about doing their jobs is different from the way the founder would or did do it.
Long-term considerations like compensation planning, benefits improvements, and succession planning become more important, because the question founders must answer is not "how do I solve today's challenges or pursue today's opportunities?" but rather, "how do I ensure that other people can solve tomorrow's challenges and know which opportunities to pursue?" Founders have to figure out either how to retain the people on the team for the long haul or how to teach those people to hire, train, and mentor the people who will be on the team in the coming years.
And, lastly, some founders will start to take their exit plan seriously because they recognize that, finally, the business can survive and perhaps thrive without their founder's mojo. They recognize that their true value is not their personal value, but the value of the enduring company they've created.
Founder's Mojo + Trust = Long-term Success
While this particular piece has highlighted how founder's mojo stifles business growth, it's important that we remember two things: it's the way that mojo is being used that can put a strangle-hold on the business; and the founder's insight, attention, and willpower are crucial ingredients of the business's secret sauce. Founders should not power down their mojo, but they should make sure they're using it to work on the growth points of the business.
Trusting their strategy, their team, and their systems enables founders to use their mojo constructively because it allows them to turn the reins over to other people who can drive the business while the founders steer the business in the right direction. With a well-defined strategy, smart, committed people can figure out how to get where founders want to go, but only if those founders are providing sufficient leadership.
While I've seen this time and time again in the world of business, I learned this lesson as a military officer. If you take care of your people and do your job as a commander, everything else works out. You don't have to be everywhere - you can't be everywhere, anyway - but good leaders don't have to be physically present for their presence to be felt. Providing leadership and building trust are how generals command legions and captains command companies.
And it turns out that providing leadership and building trust are also how great founders build enduring, remarkable companies.