After my love letter to you all last week, this week it’s back to a bit of tough love.
So things are going pretty well at your business. People love what you’re doing. And you’re having trouble finding enough of the right people to keep up with demand. It’s all good.
So why aren’t things running as smoothly as they used to?
“It’s just growing pains”, you tell yourself. And while it might be exactly that, how you deal with those pains is no small thing.
One of the most important pieces is the identity foundation of purpose and values that shape your actions and decisions, and result in your brand. But they are the foundations, and you’ve got to build on them.
So this week I’m going to assume you have those foundations in place and focus on what you’re building on top of them. To learn more about building identity foundations click here.
Hiroshi Mikitani, founder and chief executive of Japan’s largest online marketplace Rakuten taught Evernote founder Phil Libin “the rule of three and 10”, with the hypothesis that things break down at points of about three and 10.
According to Tim Ferris’s book Tools of Titans:
“When you’re just one person, everything kind of works … And then at some point, you have three people, and now, things are kind of different. Making decisions, everything with three people is different. But you adjust to that. Then you’re fine for a while. You get to 10 people, and everything kind of breaks again. You figure that out, and then you get to 30 people, and everything is different, then 100 and then 3000 and then 1000.”
Whether you’re growing quickly, or taking a slow and steady approach, the fact that scale changes things is easy to see all around us. The surprise is that for some reason we mostly fail to apply it to our businesses.
And when Phil Libin refers to everything being different, he’s talking about everything: policies, processes, distribution, finance, HR, communications, marketing, customer support, how you decide things, and who decides things.
I know from experience the shift that happens from three to 10 to 30 people. All of a sudden we had to have better processes that were documented and could be explained to new people. There needed to be a more structured approach to decision-making, because we couldn’t just talk to each other all day anymore.
We needed more free cash flow so we could pay our people and suppliers without losing sleep. Everything needed to be rethought, although not everything needed to change. But the ripple effect of the things that did meant we still had to look.
What we cared about didn’t change. The thing that helped was that we knew it. We had it as a basis for making those decisions about how to change what needed to change.
If our identity foundations hadn’t been in place, it would have been orders of magnitude harder to make those choices. And there’s a good chance they would have been all over the place, undermining each other at every turn.
Which inflection point are you at? Maybe you’ve gone through a few of them without much changing, and things are starting to fray at the edges even though you’re the same size. Maybe you powered through, and suddenly you’re at 300 people, doing things the way you did when you were at 10.
You ignore the way you do things and what you do at your peril. They are the stuff of your resulting brand. It’s not enough to have good foundations. If you want a strong and resilient brand, think about these inflection points.
When just you becomes you and a couple of others, then you and too many to fit around the table, then you and too many to fit in one room, then you and too many to have in one office, everything changes.
You don’t have to change what you care about. But everything else changes.
See you next week.
Michel is an Independent Brand Thinker and Adviser dedicated to helping organisations make promises they can keep and keep the promises they make – with a strong, resilient organisation as the result. You can find Michel at michelhogan.com or you can follow her on Twitter @michelhogan.