All too often we see businesses grow and grow only to reach an apex and coast. Then, while these corporate, cumbersome, inflexible conglomerations coast, an independent, agile, and flexible start-up will come along and adapt to the market more efficiently, thus effectively displacing the conglomeration. Truthfully, corporations should never seek to reach an apex and coast. They should be continually striving for growth. Yet, often growth brings with it added levels of bureaucracy and frustrating internal obstacles.
In fact, the vast majority of executives (94%) agree that their most difficult challenges are internal issues, not external. So, what exactly are these challenges and how do we overcome them?
The speed to adapt is a clear issue we see time and time again with larger corporations. For instance, look at how Netflix is changing the television industry while supergiant corporations are just now beginning to implement streaming services. As companies grow, their communication policies often remain the same, and they begin to get in their own way.
One way to rectify this is by holding fewer, higher impact meetings that disseminate more information on a less time-consuming basis. L Brands, run by Les Wexner, is a premium example to inspect. He holds a meeting every Monday with the most influential members of the company to discuss broad, big-picture initiatives and to remove any obstacles in the process. On Tuesday, a follow-up call takes place to verify that the decisions made the day prior are being enacted.
While young start-ups are entirely transparent considering their founder is directly in the mix, getting his/her hands dirty, larger corporations often fall victim to company-wide policies that uniformly establish supposed meritocracy. While there certainly should be uniform policies, it should be noted that they can actually discourage meritocracy on account of things like seniority and ‘accurate’ performance reports. Young start-ups don’t have this issue because the founder is directly involved in everything from the ground up. When one employee excels in this type of smaller organization, the founder knows.
This all said, corporations do not have to lose sight of what makes a true meritocracy. So long as said corporation maintains transparent guidelines and direct communication, they should be able to foster an environment where employees are promoted based off of their contributions to the company.
When a business is just beginning, the founder is intimately aware of product details, service agreements, and client names. Yet, as that same business grows, the founder and other members of the founding and executive team become more distant from day-to-day operations and more focused on big-picture items. This leads to less personal, less personable service that can eventually hurt revenue if allowed to spread unchecked.
However, this can be managed by placing particular emphasis on the executives’ roles on the frontline. By participating on the ground-floor of business activity, executives gain access to otherwise neglected information, information that could help them ultimately improve upon the business as a whole.
Although there are many issues that can stand in the way of a growing business, they can all be mitigated by simply paying attention to them, by being aware of these issues in the first place. Of course, companies face issues as they grow; we all know that. What we need to know is what, specifically, the issues are, and how we should solve them.