This post was authored by Chelsea L. Wood, a Business Operations Analyst at Insperity, and originally published on the Insperity’s blog. Chelsea has more than 10 years of experience partnering with leadership teams to identify and address business challenges related to operational performance, strategy, business development and human capital. She is a certified merger and acquisition advisor through the Alliance of Merger & Acquisition Advisors (AM&AA). Chelsea is also a MBTI Certified Administrator and Six Sigma Green Belt.
Sometimes business leaders concentrate so much on acquiring the next big account, they forget to actually plan to protect and nurture the company’s culture.
To optimize any expansion, it’s important to create specific plans – before the growth takes place – that focus on issues of infrastructure and personnel. Otherwise, you’re likely to look up after the dust settles and realize you’ve lost key personnel and that “special something” that helped define your company.
Warning: Chaos ahead
Business leaders often mistake superficial things for culture: The foosball table in the break room or the meeting rooms named after comic book characters. But really, company culture is shaped by a host of organizational decisions, some related to infrastructure.
When that infrastructure starts to collapse under the new volumes generated by growth, the culture starts to change. Consider these common situations:
- Hiring woes: Once key managers are no longer interviewing all the candidates themselves, companies may veer off course as the personality of new hires deviates from old norms. Managers begin hiring to fill chairs, not for organizational fit.
- Infrastructure fails: Ad hoc processes and procedures or existing software often fails to support larger volumes or additional complexity.
- Increased turnover: Valued employees jump ship because they feel isolated or demoralized by changes and aren’t sure they have a place in the new organization.
- Resistance to change: Employees resist necessary changes as the organization grows and matures.
- Productivity drop: Inadequate onboarding leads to less productivity as old employees scramble to train their new coworkers.
- Talent gaps: One level of experience may have been appropriate for the smaller company but hampers operations in the new, larger organization.
- Land grabs or paralysis: Lines of responsibility get muddy, leaving some managers unclear whether they have the authority to make key decisions, while others take on too much.
While these challenges may seem operational, all directly impact the future culture of your organization because culture is the byproduct of organizational decisions.
For example, if you form small employee committees to help you navigate the growth and any associated changes, your organization may be seen as a collaborative culture that values employee opinions and empowers people to actively manage the organization.
If you, or the executive team, choose to make all the decisions and dictate those changes down to the rank and file, your company will likely be viewed as a traditional, hierarchical organization with defined communication channels.
Neither of these situations is better than the other. Whether one approach works best for your company depends on its leadership and its industry. Power plant workers may expect a traditional, hierarchical workplace, while employees at an IT startup with a highly collaborative environment may require a different method.
Plan the growth, then work your plan
Much like you would plan a new product, your new, larger business requires an intentional plan for the future. After all, a company’s culture is as individual as, well, an individual.
A solid plan should help you combat the common issues of rapid growth mentioned above:
- Hiring woes: If key managers need to delegate some or most of the hiring, new hiring managers need to understand that hiring for cultural fit is important and then be trained on interviewing techniques. This requires your company to first identify what’s important about its culture, whether that’s innovation or a customer service mindset or something else.
- Infrastructure fails: Analyze existing project management structure, software systems, information flow, decision-making processes and staffing needs. You’ll also need to assess whether some parts of the operation should be outsourced or grown in-house. Planning to outsource, for instance, can lessen resistance to that change when it becomes necessary.
- Increased turnover: Engage employees early and often about why changes are occurring as a critical strategy to reduce turnover. If growth means that some positions will be eliminated, communicate that as soon as possible, preferably with the stipulation that all employees in good standing will be offered another role, if possible. If turnover starts creeping up among key performers, dig into why this is happening by performing exit interviews and addressing pain points as quickly and thoroughly as possible.
- Resistance to change: Longer-term employees may fight necessary changes for growth if they don’t understand the need for change. For instance, without adequate communication, new requirements for additional documentation for expenses may be perceived as an “added level of bureaucracy” rather than adoption of generally accepted accounting practices. Most people understand that change is inevitable for a business to thrive. They’ll be more likely to support that change if they feel like their leaders know where the company is going and why.
- Productivity drop: First, plan for and acknowledge that new employees need time to acclimate and learn their jobs. Develop a robust onboarding process so new employees can be as productive as possible, as quickly as possible.
- Talent gaps: Take an honest look at your current leadership and whether they have the leadership skills and technical knowledge to manage a larger scale business. If the company turns to outsourcing to fill gaps in leadership or line workers, cultural fit is just as important as in a permanent hire.
- Land grabs or paralysis: Fully think through organizational charts and processes before and during times of rapid growth. Clear lines of responsibility keep customer needs from falling through the cracks and prevent overly ambitious managers from steamrolling over others.
By being deliberate in your growth, you can build the type of culture that fits the promise you’re making to customers, rather than accepting a default culture that exists in the absence of any effort.
Keep your company on track during rapid growth with the help of our free e-book, How to Develop a Top-notch Workforce That Will Accelerate Your Business.