Site Destinations

The Entrepreneurial Curse

By Buckley Brinkman

All of us know at least one entrepreneur in our lives. They are the people with boundless energy, creative minds, and the bias for action that most of us envy. They are the people who generate heat, light, and energy that the rest of us can use to fuel our own fires. They are the people who find opportunities around every corner and always have their arms around the “next big deal”.

Often, that big deal takes root and starts to grow. The seed strewn along the path finds fertile ground and tender, green sprouts start their path toward the sun. In business terms, a company is created. It gains a following, creates sales, and (hopefully) posts profits.

At this point, a small group of true believers and disciples make the entrepreneur’s vision(s) come to life. They are in close contact, have numerous conversations, understand and tend the vision, and find unique and nimble ways to make it come alive. Communication lines are short. The vision is relatively straight-forward and clear. The entrepreneur’s energy and spirit carries the young organization.

If the entrepreneur is talented enough, the vision is compelling enough, and/or the value created is high enough, the company begins to grow. This growth causes the need for more resources – people, assets, and capacities. As the company continues to grow, the need for communication and coordination grows exponentially. People must understand the vision and appropriate actions to make it a reality. Assets must be effectively deployed. Capacities must be created in order to handle the increased complexity.

At some point, many of these organizations reach the limits of the entrepreneurs and their disciples to communicate and coordinate across the company. This limit causes the vision to lose focus, growth to stop, and profits to disappear. This limit also forces a decision: continue to grow and find help to make the company better, consolidate the company back to a size the true believers can handle, or continue to grow without change and have the company eventually implode.

We often see business at or past this limit. The entrepreneur can no longer come up with the next brilliant action to pull the company along. It’s too big, too complicated, or just too hard for the entrepreneur to handle alone.

If you look at the literature or search the internet for the best thinking on this subject, most of it surrounds the idea that it’s time for the entrepreneur to bring in professional management. Create processes, plans, budgets, policies, and routines that will enable the company to grow to the next level. Of course, in a rational situation, this is exactly the right action to take. The vision can be codified and coordination can be handled by a whole arsenal of management tools properly applied.

So, the company invites the consultants and professional managers into their midst. They bring in their expertise and conduct their analyses. The analyses almost uniformly come back with some version of “It’s time for the entrepreneur to loosen the grasp and allow professional managers to run the company.” It’s a totally rational conclusion.

The curse of the entrepreneur is that the situation is rarely rational. In most cases, these companies are extensions of the entrepreneurs themselves. They gave their companies life, energy, and love. These companies are their children, and turning them over to strangers is totally antithetical and borders on immorality.

In situations that we see, communication and coordination lines have become too long to tend on an ad-hoc basis. This becomes the critical issue. The “Professional Management” solution brings the process and structure necessary to address the issue. Communication and coordination become part of an overall system that brings stability and predictability to the organization.

Unfortunately, this solution is akin to using cannon to swat a fly. The entrepreneur and the entrepreneurial organization pride themselves on being flexible, opportunistic, and fully aligned with their customers. The new system and the structure it brings often eliminate any possible spontaneity that keeps the company fast and flexible. The changes frequently cause tremendous stress and conflict in the entrepreneur and the true believers.

Most of the entrepreneurs I know immediately reject these recommendations. Many that accept the changes inevitably wind up either leaving the company (depriving it of a large part of its soul), or undermining many of the changes (leaving the company without the needed structure). Isn’t there a compromise we can find that allows the entrepreneur to continue to provide direction and energy, while building the company up for the future?

I contend there is a way.

Extend the communication lines and tighten coordination in critical areas by creating simple routines around communication and coordination. These routines should be constructed in a way that they cause minimal pain to the entrepreneur while delivering maximum impact. The key is to keep the vision as fresh, specific, and shared as possible without imposing structures and procedures that diffuse the energy that comes with the vision.

The new routines should insure that the entire organization understands the critical issues facing the organization and provide general guidelines for addressing these issues. It should also provide the forum for clarifying critical elements and enable the organization to move forward in a unified fashion. Discussion in these routines should center on:

These five categories encompass the critical elements that keep the organization moving forward in a coordinated, effective way.

Selecting the particular communication medium is critical in order to maintain consistency and involve as many stakeholders as possible. The medium or media chosen should enable effective, efficient execution and be as comfortable as possible to the leadership. Slick, professionally produced efforts look good, but often involve an investment of time, money, and energy that are unsustainable on a weekly (or more frequent) basis.

The most effective routines involve a wide span of control, so that the most possible people can receive the same message in the same way. The organization can concentrate on executing the strategy, rather than interpreting and reinterpreting mixed messages. The message can come through in newsletters, meetings, videoconferencing, conference calls, or any other medium that provides interaction between leadership and the rest of the organization on a regular basis. Action and alignment are the critical outcomes from these efforts.

Extending the communication and coordination lines make it possible for entrepreneurial organizations to extend their success without sacrificing their flexibility to react to new opportunities. This cure truly overcomes the entrepreneurial curse.