Leading at the Speed of Growth The Challenges and Initial Growth Avimanyu Datta, Doctoral Candidate

Question Why do you think even after years of its formation, Michael Dell, Bill Gates are still running their companies whereas Hewlett, Packard, Paul Allen have opted out? What determines survival of a firm? And that of the founder? Are those interlinked? The very behaviors and habit patters of entrepreneur that leads success in one stage can lead to failure at the next one?

Challenges of Growth Three distinct stages: Initial Growth, Rapid Growth, Continuous Growth. Mark the evolution of a firm after it goes through a start up stage and becomes a real company. In these stages there are severe changes to your organizations, in terms of products, services and even the type of organization. Eg, Intel, IBM, Nokia

Challenges of Growth Develop Markets, products/ services, customers, and strategies to win. (Niche Vs Cost Leader) As your company grows you must alter from the “do it yourself mode” to delegation. Develop internal process for planning, management and workflow, as well as infrastructure to sustain expansion of growth Develop teams and people to perform the tasks that produce exceptional leaders Develop cultural environment that can embrace change, and where people can work in teams

Challenges of Growth Develop cultural environment that can embrace change, and where people can work in teams Change your leadership style to map the stages of growth. (Exploration Vs Exploitation) Balance is necessary. Xerox Vs Microsoft. Balancing short term vs. Long term goals

Challenges of Growth Communicate well to produce alignment between short-term, and long-term goals; exploration and exploitation. People are key assets. Gary Hamel’s perception “ Management of Innovation begins at managing the innovators, who give eight hours each day of their lives for your company”. Learn from failures of other and your own.

Vital Signs of an Entrepreneur Visionary and Pioneering not only a company but an idea. Great at seeing possibilities where others don’t Passionate and Energetic Creative and innovative idea generators Proactive and future focused Risk taking Problem solvers Determined to create wealth and make change.

Evolution of your role as a CEO Dominate the Industry Continuous Growth Change Catalyst/ Organization Builder/ Strategic Innovator Turbulence Rapid Growth Lead the Market Team Builder/ Coach / planner/ Communicator Turbulence Initial Growth Drive Sales Delegator/ Direction setter Develop product Startup Doer/ Decision Maker

Evolution of your role as a CEO Reinventions in the company. Successful firms reinvent themselves. Eg. IBM, HP, starbucks, Amazon, Intel, Apple Complex organization Alliances, mergers, IPO Continuous Growth Widespread acceptance of its products Gain Significant share in its market Try to be a market leader New Hires challenge in integrating them Rapid Growth Sales Driven New or different Product launch to capture market Fast faced, flexible, chaotic and Aggressive Initial Growth Figuring out what products or Services to offer Startup

Initial Growth Initial Growth Drive Sales Delegator/ Direction setter Launch Differentiated Products Capture market Share Grow revenues Delegator/ Direction setter Develop product Startup Leader Doer/ Decision Maker

Initial Growth Stage: Company Goals Launch a product that offers something different. Low cost strategy may not be viable for a new entrant unless you are the first one in market. Get Noticed by winning some impressive customers, possibly business leaders. Grow Revenues Capture Market Share

Initial Growth Stage: Characteristics Fast paced Highly flexible/ willing to experiment Fast exploration and exploitation time Chaotic Sales-Driven Close to customers Lacks structure

Initial Growth Stage: Signals for changing your roles Not enough time Impossible to do everything Everyone wants your time and you can’t seem to get it You don’t know which of multiple growth opportunities to pursue Feel pressurized because you’re managing all the risks alone.

Initial Growth Stage: Dangers if you don’t change Resented as a manager and a bottleneck. People will be de-motivated and wait for you to make all decisions. The company will lose focus. Priorities will change in micromanagement as one tends to adopt the ideas of the moment philosophy Growth will be impeded.

Initial Growth Stage: Critical Responsibilities Articulate and communicate your values and visions Use resources creatively Watch Critical performance indicators. Integrate input from stakeholders with your own perspective Hire multitalented people who share your values and complement your skills Use Mentors

Initial Growth Stage: Personal changes in your leadership role Manage proactively Begin delegating responsibilities; establish systems and a structure with clearly defined roles, responsibilities and priorities. Set up functional roles Stop making all decisions Stop solving all problems and answering all questions Trust others and make them accountable for results.

Initial Growth Stage: Personal changes in your leadership role Start planning for the future. (Bigger Picture) What other areas should we invest? What are our capabilities? In-source Vs Outsource? Accept the need for processes and structure Share credit and limelight with others Consciously spend a portion of your time on the big picture of your business, not just day-day operations.

Questions? Comments?