Paystubmakr.com presents small company vs big enterprise
For a baby, growing is the essence of its existence, being grown up is its achievement. In the end, a baby can become a shoemaker or a CEO of a 30,000 employees enterprise. Those people that want to create and build big companies and organizations need to be borne having a sparking mind that let them do it using their greatness.
OLD TIME ADMINISTRATOR
Jumping up from smaller to a more prominent corporation happens more in small countries or small areas of businesses where the layer of capable and trained managers are too thin, so option or candidates for an executive job is limited. Playing musical chairs between positions may be typical.
An example of the changes that happen when a company becomes a big corporation, is the technological genius, Steve Jobs, Steve started small and low and later lost his CEO job because Apple has grown beyond his managing capabilities.
A typical case is electing a successful manager in a small company as a manager in a larger enterprise or even worst promoting a successful production manager to be a General manager.
Lawrence Peter wrote the book “The Peter Principle” about the downfalls of bureaucratic organizations. It can be commercial operations as well as technological or governmental ones. The book show who the traditional promotion in the hierarchically structured business make the election of the best head of department to be the worst head of the entire division.
The position requires different capabilities; now, the newly promoted and happy new division manager has to deal with the heads of the department he used to join before, not his old team that was trained by him and became a team like a family.
The leaders of the other subordinates departments are at higher level and higher ambitions than his old subordinates. There is need of diplomacy and leadership to keep them under control; it is not enough being a highly trained engineer. Failing to can convert the happy newly promoted person to an unhappy and frustrated person.
At this point the Peter Principal may take effect, if the new division head cannot adapt himself to the unique requirements of higher responsibility he will be reaching his level of incompetence, it may go like this for a few promotion levels until the level of incompetence is reached.
Only a few great people survive and become the extraordinary managers of extraordinary enterprises.
What happens with a corporation, big or small, depends on the personality of its manager or those that replace the founder/manager. There is a need for different DNA to convert a startup to something like Google or Honda.
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One typical phenomenon is those entrepreneurs that are acting like serial startups and new businesses founders that never stay after the operation becomes successful, they are replaced, or they sell the operation, take the money to a new project or retire in the best case or sadly after losing it all.
THOMAS ALAVA EDISON
The breaking point
Many managers fail when the climb up to larger operations. The reasons are different; sometimes it is the lake of experience in managing. They keep being part of the team but treat other high executives with the same informal spirit of a smaller team.
Suddenly the head of a group, the best guy in town finds himself surrounded by people he does not know, habits that he is not used to, a new world that can cause a kind of a cultural shock. They feel bad about the drastic changes, having limited or no contact with their “old-time” clients that they know for years. Clients that they may share with their weddings and birthdays, bad times and days of grief.
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Another issue that may be a problem is the need to take important decisions on larger budgets while they may still look for the cents instead of the dollars. In his book “Future Shock” Alvin Toffler describes the cost of fast changes and decision-making in humans life. As he wrote, “This is a book about what happens to people when they are overwhelmed by change.” Toffler tells in the book about this man that refuses to buy a new car to replace his old one, just because he does not want to take the decision he needs to preserve his life status quo. Promoted from being the boss of 20 employees to be a CEO of 200 employees or from 200 to 2000 are life-changing events.
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How to make it and not break it:
Being an employer or manager of 20 employees running a startup project is close to being the head of a family or an elder brother of this team. In the small startup, office door may be open at any Nine CEO Communication Practices To Keep Your Management Team Engagedmoment to any one of the employees, that feel a need to discuss some important idea with his friend and boss. Open door in a startup may be the most important habit for a breakthrough of new technical or theoretical invention but can be disturbing for the higher level operation.
For a manager to change from twenty up to two hundred employees, he will need to adapt to new habits like having a secretary as a barrier that filters and block the contact with his old time team. Apparently, a 2,000 operation will need even more isolation and distance of the newly promoted manager.
No more being the number one and leader of his smaller team and start dealing with new requirements of a larger operation, administrative and human resources issues may be the breaking point of a failing manager that maybe comes from engineering and production even though he was the number one in his field.
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Promoting the best shoemaker to manage the shoe factory is typical hierarchical management that could bring the factory to a bankruptcy.
A company that does it is doomed unless the shoemaker has the sparkling character so can forget his past way of working and change to leave “shoe-making” mentality and start to administrate and delegate using his old experience only when he looks from above at company meters.
Success can be achieved by the promoted manager only if he is capable of learning from is own mistakes and let his team do the same with its members. A great advantage is if he feels that he is losing control and make the necessary changes in his way of managing.
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According to Elvin Toffler’s book “Future Shock,” The manager that cannot adapt, may lose his health because of the stress and frustration. Today we know what stress can cost to our health regarding overweight, blood pressure heart disease and more.
The greatness of CEO that grows with the growth of his company:
Choosing the best people that will do the job for him not trying to do it himself.
Let the people he has chosen space to work, make their mistakes, learn from their mistakes and achieve better results.
Getting the best professional experts to support and assist him.
If he comes from the technical area, he should learn the administrative field enough to have it controlled.
When an administrative person has to manage the technical team, he should not block the bread and butter production because of a budget watch.
Paystubmakr.com team thanks you for reading and wait for you for the next blog.