Who can help me plan for my organization to scale substantially?
March 18, 2014 9:18 AM Subscribe
I work in a company that's growing about 30% a year, and plans to continue to do so for the next 20 years. Specifically, I manage the administration of one division of this company, and I've been asked by my exec to head up an effort to create a plan to allow us to scale effectively over the next 10-20 years as we go from a division of 500 people to one of 5000.
I don't really know where to start in finding people or organizations that can help me with this. What keywords are my magic search terms? Who are the people/orgs who are super awesome at creating an organizational scaling plan that I can hire to work with us on this? What should I beware of as I start us down this road?
Halp, please! and thanks.
I work in a company that's growing about 30% a year, and plans to continue to do so for the next 20 years.
This seems highly unlikely at the outset, but as long as everyone is thinking in hypothetical terms it is okay as long as they know that this really won't happen. Here are the key things I would put together for consideration, because knowing some good questions to ask may help find the right consultant:
* When growing rapidly it becomes tempting to get lax about hiring standards. It is better to turn away business than to make bad hires. People flock to a rising ship but you want people who want to build a great company, not just be a part of one.
* It is tempting also to promote within, but the problem is that most of the people in your internal culture know how to run a 500 person shop. When key new VP/CxO position open up plan to hire externally to get people who know the logistics of the 5,000 person operation.
* Question whether you are better suited to centralize staff and offices or distribute it. There is no short answer to this and it is influenced by ability to hire talent, regulations and God knows how many other things, but growth may afford an option to create satellite offices in strategic locations.
I would suggest also throwing into the mix scenarios where business contracts in a year and how you respond to that. It is useful to think in calm terms about which cost cutting measures you will take before it gets real. This is all a really complex topic, but you might find someone at your local SCORE chapter who was part of a company that grew a lot during their tenure or they worked at a high level in enough different places that they can further advise on this.
posted by dgran at 9:45 AM on March 18, 2014 [2 favorites]
This seems highly unlikely at the outset, but as long as everyone is thinking in hypothetical terms it is okay as long as they know that this really won't happen. Here are the key things I would put together for consideration, because knowing some good questions to ask may help find the right consultant:
* When growing rapidly it becomes tempting to get lax about hiring standards. It is better to turn away business than to make bad hires. People flock to a rising ship but you want people who want to build a great company, not just be a part of one.
* It is tempting also to promote within, but the problem is that most of the people in your internal culture know how to run a 500 person shop. When key new VP/CxO position open up plan to hire externally to get people who know the logistics of the 5,000 person operation.
* Question whether you are better suited to centralize staff and offices or distribute it. There is no short answer to this and it is influenced by ability to hire talent, regulations and God knows how many other things, but growth may afford an option to create satellite offices in strategic locations.
I would suggest also throwing into the mix scenarios where business contracts in a year and how you respond to that. It is useful to think in calm terms about which cost cutting measures you will take before it gets real. This is all a really complex topic, but you might find someone at your local SCORE chapter who was part of a company that grew a lot during their tenure or they worked at a high level in enough different places that they can further advise on this.
posted by dgran at 9:45 AM on March 18, 2014 [2 favorites]
This is why management consulting firms exist.
posted by valkyryn at 10:22 AM on March 18, 2014 [1 favorite]
posted by valkyryn at 10:22 AM on March 18, 2014 [1 favorite]
Response by poster: We're a software/software-and-services company. Our growth is driven by creation of new products/services and taking on new customers. My division serves external customers, both new and base. We've been growing at 30% year over year for 15 years, and though we know it's no guarantee that it'll continue, we've made pretty good plans to keep heading in that direction.
My division leader and I are grappling right now with the issue described by dgran of our people knowing how to run a 500 person division but not a 5,000 person one. That's why we want to hire someone to help us with this: we don't know what we don't know, but we know there's a lot we don't know.
posted by spindrifter at 11:02 AM on March 18, 2014
My division leader and I are grappling right now with the issue described by dgran of our people knowing how to run a 500 person division but not a 5,000 person one. That's why we want to hire someone to help us with this: we don't know what we don't know, but we know there's a lot we don't know.
posted by spindrifter at 11:02 AM on March 18, 2014
If you are growing 30% in 10 years, proportionally if you start with 500 people you would need over 25,000 people in 10 years. If 20 years, it would be 95,000 people (which I think is more than Apple has). Your keyword search would be "how to manage a Fortune 500 company workforce".
posted by Dansaman at 11:29 AM on March 18, 2014
posted by Dansaman at 11:29 AM on March 18, 2014
Response by poster: Sorry to threadsit, and after this comment, I'll just close the page for a couple of days, but I feel like some of the comments here are a little snarky and not really answering my question. Maybe I'm reading tone wrong, which is easy to do, but I'd love it if comments could be more on point. Thanks!
posted by spindrifter at 11:53 AM on March 18, 2014
posted by spindrifter at 11:53 AM on March 18, 2014
When thinking about scaling up, you shouldn't think in terms of increasing people but in terms of increasing output of whatever it is your company does. Ideally you should benefit from economies of scale so that you can do 10 times as much stuff with less than 10 times as many people.
You need to look at how much time it's taking people to do various tasks in your company and ask yourself how much time it would take if they had do 10 times as much. If the answer is a ridiculous amount, then that is a task you need to re-engineer to be more efficient.
For example, I used to work for a small startup whose order fulfillment process included having employees manually copy/paste information from the web order forms into their internal database, then from that database into their accounting software. This process wasn't a big deal when it was just 10 orders/day but at 100 orders/day it made sense to invest time and money into integrating those three systems. If we'd kept the same process up until 1000 orders/day, we'd have to have several employees who didn't do anything except copy and paste all day, which would be ridiculous, right?
I think you would find the business novel The Goal helpful in learning how to think about constraints and how to re-engineer processes to eliminate bottlenecks. While it may seem strange to read a work of fiction to learn about business, I found that the novel format makes it a much more engaging and quick read than trying to learn the same information from a textbook.
posted by Jacqueline at 2:17 PM on March 18, 2014
You need to look at how much time it's taking people to do various tasks in your company and ask yourself how much time it would take if they had do 10 times as much. If the answer is a ridiculous amount, then that is a task you need to re-engineer to be more efficient.
For example, I used to work for a small startup whose order fulfillment process included having employees manually copy/paste information from the web order forms into their internal database, then from that database into their accounting software. This process wasn't a big deal when it was just 10 orders/day but at 100 orders/day it made sense to invest time and money into integrating those three systems. If we'd kept the same process up until 1000 orders/day, we'd have to have several employees who didn't do anything except copy and paste all day, which would be ridiculous, right?
I think you would find the business novel The Goal helpful in learning how to think about constraints and how to re-engineer processes to eliminate bottlenecks. While it may seem strange to read a work of fiction to learn about business, I found that the novel format makes it a much more engaging and quick read than trying to learn the same information from a textbook.
posted by Jacqueline at 2:17 PM on March 18, 2014
Best answer: So I think one of the problems you will run into is how do you make sure people do what you want them to do (managerial agency) while still giving them freedom to decide how to do it. I believe you want consulting in Organizational Development. There are the big management consulting firms (e.g. McKinsey) and then the boutique ones.
If this were my problem to solve...I think I would attack it from the standpoint of "how to hire effective management consulting" rather than trying to get recommendations on a specific firm. I've seen a lot of consultants come and go in my 30+ years in software and electronic product development -- some gave great value and some were a waste of time.
I would also recommend networking within your industry and asking some of your trusted contacts for specific recommendations of consultants -- they will probably be able to give you more on point recommendations.
Hope this helps. I've been a consultant (internal to a Fortune 100 company, working with divisions to help them develop software more effectively) -- it is a tough job and requires good alignment between consultant and client among other things.
posted by elmay at 4:17 PM on March 18, 2014
If this were my problem to solve...I think I would attack it from the standpoint of "how to hire effective management consulting" rather than trying to get recommendations on a specific firm. I've seen a lot of consultants come and go in my 30+ years in software and electronic product development -- some gave great value and some were a waste of time.
I would also recommend networking within your industry and asking some of your trusted contacts for specific recommendations of consultants -- they will probably be able to give you more on point recommendations.
Hope this helps. I've been a consultant (internal to a Fortune 100 company, working with divisions to help them develop software more effectively) -- it is a tough job and requires good alignment between consultant and client among other things.
posted by elmay at 4:17 PM on March 18, 2014
Well for one thing, this would be a good time for some serious reflection on your company culture, with a goal of figuring out what you want to keep and what you want to change. Then develop and implement a plan to get there. Culture scales, but it changes slowly. Better to work on it now and then tend and nurture it when you grow than to try and do it when you get to be 2500 people.
posted by Good Brain at 8:29 PM on March 19, 2014
posted by Good Brain at 8:29 PM on March 19, 2014
This thread is closed to new comments.
What's driving your scaling? What sort of demands are you responding to? Are your customers internal? (Is your division servicing other divisions, in other words?) Or are they external customers? New customers vs. base?
Answering questions in terms of what business drivers there are will help you break it down into smaller, manageable problems. There may be multiple, different sources to deal with the different needs of your expansion.
posted by Thistledown at 9:37 AM on March 18, 2014 [1 favorite]