27 June 2007

The Founders' Pie

A reader of this blog referred me to this article about a Founders' Pie Calculator as a way to add some science to splitting up the founding pie. While this method is also still an estimate, it does require that the founders put some tangible thought behind relative values brought to the organization and it does bode well for future sound decision making.

25 June 2007

Make Yourself Dispensible

Where would your company be without you? Better off?

Most Founders don't even consider where their companies would be without them. In fact, founder organizations often require intimate and frequent communications with the founder. This is the natural result of a driven founder with intimate knowledge of the marketplace and the solution being produced . Founders tend to take few vacations that allow them to become untethered from the organizations they created. Founders make many (most) of the critical decisions for their companies. Founders hire people who execute on the founder's decisions - usually not decision makers themselves.

But have you ever thought about whether this is bad or good for your company? While it may feel good to the founder - no decision gets made by some bumble head who doesn't know as much as the founder - and it may make the early stages of a company function efficiently - no bureaucracy, in the long run this poses an undue constraint on the organization as it grows beyond double digits of employees.

Founder decision making is just like the days of time sharing computers. For those of you who are not old enough to remember, time sharing computers gave multiple people access to a single computing resource (usually connected via a slow dial up line and acoustic coupled modem) by slicing the time the processor was dedicated to each individual task. Usually this was done fast enough to make the user believe she had unfettered access to the computing resource. However, when enough people tried to access the computer all at the same time, the response times suffered. (We actually are spoiled now - we accepted these delays as normal - such lack of responsiveness even under the best of conditions would not be acceptable today.)

Similarly, as the load increases on the founder with more and more employees clamouring for access to the founder, decisions get slower and slower - sooner or later bringing the organization to its knees.

It is the unique founder who "gets this" (before her board steps in) and begins to decentralize decision making. Often founders feel uncomfortable taking this step - allowing the bumble heads to make the decisions. They are too used to being the "go to" person for all major issues that anything short of that leaves them numb. But as soon as a founder realizes that she can hire smart people and permit them to make some of their own decisions, the organization gains a whole other level of potential and cycle times can begin to reduce.

So next time you revel in the idea of your indispensability - think again! Maybe you need a vacation?

08 June 2007

Vote with Your Feet

Ever been in an organization where after a change event occurs there is a constant back channel discussion about how the sky is falling? Ever participated in one of those conversations? Come on now, be honest!

There really is only a binary decision that needs to be made when experiencing a change event: either embrace the change or vote with your feet - that is get out if you don't like it.

Change is often accompanied by the unknown. It's human nature to expect the worst under conditions of change. So in the organizations I've led, I always suggest the following approach.

1) Give change a chance. Often times people react immediately to change. For all they know the change might be good or might enhance their career opportunities. So unless change hits you directly between the eyes (like in the case of being laid off due to a change), wait with a positive (or at least neutral) attitude to determine whether or not the change that is occuring is something you can live with.

2) Once you determine that you don't like the change (and you've at least given it a chance) vote with your feet. Get out. Or at least start the process for finding a new opportunity.

All too often employees choose a third path which is to stay and complain. When you stay and complain, you've got no one to fault but yourself. Complaints feed upon themselves. They foster an environment of resentment. And they don't lead to any positive results - either for the individual or the organization.

So either embrace the change ..... or vote with your feet!