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“Growth creates complexity, and complexity is the silent killer of growth.”
These are the first words of Chris Zook and James Allen’s new book, The Founder’s Mentality. The authors assert that 85% of companies blame internal factors for their inability to grow, not external factors like market dynamics, competition, and other disruptive forces. Instead, the addition of management layers, the constant drumbeat of meetings, and a focus on the “internal customer” kills growth. You get away from the things that made you great in the first place. Owners get too far removed from the real work.
We discuss this paradox often at GuildQuality – the more successful you are, the bigger you become, and the more difficult it becomes to maintain growth or maintain the pace of growth. We know that our members face this issue as well because we often hear comments such as “I’m [owner] struggling to replicate myself” or “I [owner] worry that the team may not be executing as well as we’d like” or “we have a lot of meetings these days” or “lots of little things are slipping through the cracks.” These are real frustrations that stall growth.
What do you do about it?
In the book, Zook and Allen talk about (re)instilling a “Founder’s Mentality” in your company by focusing on these three themes:
- Insurgency – Articulate and rally around a bold mission, get everyone on the same page, be clear on your points of differentiation, and carry the flag up the hill to face the competition and market opportunity head on. It’s a mindset of urgency and focus. You have this as a start-up, and yet it fades gradually as profits grow, the team grows, and you get comfortable.
- Front-line obsession – Focus on delighting the client, listen to frontline employees’ feedback, innovate and advocate on behalf of the client, make heroes of those employees who serve on the front line. This requires owners to join sales calls, spend lots of time in the field, abandon internal meetings, and look externally.
- Owner’s mindset – Speed and agility is a point of differentiation. You move faster than the competition and blow through internal hurdles. Team members are empowered to make decisions on their own and they’re held accountable for those decisions, and there is an aversion to bureaucracy and anything that might slow you down.
The ultimate goal is to become a Scale Insurgent – a company that has scaled up, continues to grow at a rapid pace, and maintains the Founder’s Mentality. Related to this (of course) is a laser focus on client satisfaction, and most of the companies mentioned in the book also have very high Net Promoter Scores (NPS). Some of these companies include Amazon, Apple, Chick-fil-A, and Harley Davidson – you experience the Founder’s Mentality in every interaction you have with them. In lots of small ways, these companies show you that they’re different.
Some companies have lost their way and gotten back on track by refocusing on the front lines. Home Depot shed non-core businesses and refocused on the stores. Delta Airlines refocused on improving the passenger’s experience, and their satisfaction scores became the highest in the industry. Michael Dell took his company private to focus on longer-term innovations, which the public markets are too impatient to endure.
Here at GuildQuality, we’ve also worked hard to maintain the Founder’s Mentality, with a big emphasis on the front line focus. As we’ve grown from a start-up in 2002 to over 2,000 members today, it’s easy to become awash with internal priorities. Just this year, we made it a top priority for everyone in the company to get out into the market – from our sales team to our engineers. We asked the team to leave the office, travel to our members, and have face to face conversations about the business, our service, and how we can serve the industry. The feedback has been terrific, and it’s helped us to shape the product plan going forward.
Insurgency also rings a bell for us here. When we were a start-up and again through the dark times of the Great Recession, we picked up the flag and took the hill. There was an urgency about everything because it was a matter of survival. While difficult, those were great times in our history in which innovations were born and strong disciplines implemented. Telling those war stories and talking often about our mission – “to elevate the stature of the building profession to a level commensurate with its importance” – has helped us to build the next generation of insurgents within our business.
So, how do our members maintain a Founder’s Mentality? We asked a handful of great leaders within our community, and here’s what we learned:
“As we’ve grown our business, it’s been extremely important to create a team that values and cares as much for our clients as our owners do. We put in place a “Lifetime Service Warranty” and we empower our employees to handle any issues that come up so that our customers are completely happy. This exemplifies our caring corporate culture. We also employ an “all hands on deck” approach to resolving client issues which seems to make caring contagious. Our partnership with GuildQuality for surveying has been an invaluable tool for measuring the success of our individual team members and company as a whole while enabling us to hold our entire team accountable.”
“I think to expect an “owner’s mindset” we have to empower our team. The famous quote, “With great power comes great responsibility” rings true. But, the inverse of this quote is also true, “When given responsibility, power is instilled.” Our people must be given clear direction and entrusted to take care of our customers. The owner of Hullco, Matt Hullander, has told our team many times, “Do the right thing… Do what you think my Dad would do and do the Christian thing.” Following this directive is simple – act in the customer’s best interest and the rest works itself out.”
“At Sideco, it all starts with proper training. We want everything we do to be done the best way possible, so we teach that and we never compromise on that simple principle. We are always striving to be better and more efficient at those best practices. These principles are ingrained into the team and they directly affect what is best for the customer. We make sure all team members know that the customer is the most important aspect of our business, which is why we ingrain these principles in everyone on our team. It’s a simple philosophy but it’s served me well for 31 years.”