Platt Perspective on Business and Technology

Re-Visioning leadership 5 – business stage-specific skills and experience requirements for scalability beyond the simple and linear

Posted in startups, strategy and planning by Timothy Platt on January 25, 2013

This is my fifth posting to a series in which I discuss leadership styles, and the issues involved in meshing the right leader to the right organization, and for their style and approach and their hands-on skills and experience, and for the organization’s current and emerging needs (see Business Strategy and Operations – 2, postings 345 and scattered following for Parts 1-4.)

• I have already discussed issues of industry-specific fit in Part 2: staying in-industry or bringing in new, outside experience and skills 1 and its continuation as series Part 3.
• And I began a discussion of business stage-specific fit in Part 4 where I focused on the special cases of startups and also early stage businesses.
• In all of that I argued the case for the senior executive’s need for basic and even generic leadership skills, but how certain business leadership contexts can call for specialized skills, experience and credentials too. Startups, I argue, are a particularly important case in point there where would-be startup founders and entrepreneurs need to be able to organize, manage, lead and inspire in the absence of pre-existing structure and support systems.

My goal for this installment is to discuss leadership in the context of business scalability, and particularly where that involves significantly qualitative change in a business and how it relates to its marketplaces, and not just simple linear growth. I have been writing and posting a series on Moving Past Early Stage and the Challenge of Scalability in this blog (see Startups and Early Stage Businesses, postings 96 and scattered following) and cite that as a background resource on business scalability per se.

But before I begin that discussion I note that general leadership skills can go a long way towards effectively managing and leading in most any business context or situation. In that, startups might be considered something of a special case exception where startup experience per se can make the difference between leadership success and failure, and resulting business success or failure.

I have also seemingly continuously and certainly repeatedly written about the importance of the unique value proposition that defines and creates business strength and market share. And I have written in that context about how a unique value proposition can be developed in the products and services offered, but it can also be developed in a business’ operational practices, and certainly where they impact upon and help to improve the consumer experience. Defining and developing, and implementing new sources of unique value in the business itself always and by definition means making novel and qualitatively distinctive business changes, and not simply developing along some clearly discerned linear path. If more standard leadership skills and experience can suffice in bringing a business to a new level of effectiveness and market strength through that, and they generally can, then where are special skills and experience actually needed?

I would argue that there is no single, simple algorithmic answer to that question that could be applied for understanding and responding best to any possible situation. But there are tests that can be applied to help a business’ senior executives discern when specialized skills and experience would offer value and when at the very least, specialized expert strategic consulting and an experienced extra pair of eyes might be of value. And the challenge of scalability and of pushing a business to grow beyond the simple and linear, and in new and novel ways serves as an effective context to discuss that from.

• When a business seeks to scale up significantly, one point that is all but certain to apply is that it has already existed and functioned as a successful operation, and that it has a historically based track record of process and performance. It already has a corporate culture and a sense of how things are done. And all of this carries with it a measure of momentum that would shape any decisions or actions taken, moving forward.
• When innovation through finding and implementing new variations on a business’ “standard methods” does not work in breaking out of its current linear growth pattern, and when it is realized that something more profoundly innovative is going to be needed to break out of current scale limitations, then new leadership skills and approaches are probably needed.
• When businesses face challenges and opportunities that are dramatically novel, ability to in effect break new ground can be crucial and prior relevant experience invaluable.

And at this point I raise the two fundamental questions that I have been leading up to in this posting. When I wrote of startups and early stage businesses, I focused on one area of uniqueness for leading in that context, out of a long list of potential and arguably very significant points of distinction: effective startup leadership means building without systems and resources already in place.

1. When should business leaders realize that they are facing a level and type of novelty in the strategic decisions and options they face, that their standard leadership approach and a linear path forward would not suffice?
2. How do you best operationally define the factors and parameters that would call for new and nonlinear thinking in this?

• Certainly one answer to the first of these questions would be stagnation in growth over a series of consecutive quarters, where markets should be strong enough and growth positive and significant – but where simply following the same linear growth approach is not leading to significant expansion.
• A linear growth-oriented response to the second question would be to systematically look for operational and procedural bottlenecks and inefficiencies and to simply address them, in some prioritized-for-expenses-incurred order and according to standard strategic thinking in place.
• Bringing in that strategic consultant or looking for new blood and new ideas for the in-house executive team begins to really make sense when identifying and addressing this list of limitations to potential growth proves insufficient to achieve anything really significant.

Scaling up a business generally applies where that business starts out fundamentally sound, even if at a level significantly below what should be its potential. I am going to challenge that assumption in my next posting and consider change management challenges and the need for fresh leadership ideas and approaches, and even situational expertise in dealing with this for a business’ basic survival. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.)

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