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How to get from small to big without losing vision
Jack and Suzy Welch



Q WE are a company that is growing fast, and we've started to have trouble organising ourselves. What is the best way to go from a small company to a big one?

Ante Milos, Sarajevo

A What a great problem to have.

Growth like yours can only mean you've figured out a strategic 'Aha!' . . . a new product or service that customers really want and competitors don't offer . . . and that you have an energised team to match.

Nice going. But brace yourself.

The leap from start-up to established business is one of the trickiest transitions in an organisation's life. If left to happenstance, it can really cause a company to come unglued. The problem is that many start-ups, while installing processes and systems to organise their burgeoning bigness, accidentally kill the spirit and energy that made them so successful when they were small. That's why your overriding goal right now must be to help your company grow up . . . and still stay young at heart.

Start by going back to the basics: mission and values.

When you were starting out, everyone probably worked together and could feel in their bones where you were going and what behaviours were expected of them to get there. But as new hires have poured in and operations have dispersed, your mission and values have probably become somewhat fuzzy.

That's trouble waiting to happen. Stop it by talking about the mission and values ad nauseam, always remembering that people haven't lived them like you have.

Your next step is to establish an operating system and rhythm since you've probably got along so far using ad hoc forms of budgeting and planning. It's time for the real thing now.

But remember: avoid bureaucratic awfulness.

Keep planning to a few key ideas designed to generate lively discussion. And make sure budgeting doesn't devolve into a phony series of negotiations, culminating in a rigid number instead of exciting goals. Whatever you do, never punish people for missing bold targets.

Reward them instead for how they did compared to last year's results and how they did relative to the competition or the opportunity.

Speaking of rewarding people, no company can go from small to big without a rigorous, candid appraisal process at least twice a year.

Momentum won't carry you forever, and you need to make sure you have the best team. To do that, you will need some systematic form of differentiation: identifying great, average and sub-par performers so they can be moved up or out accordingly.

Unfortunately, in your situation, as with every growing start-up, some underperformers are sure to come from the ranks of your original employees. Just because someone started out with you doesn't mean he or she is a star. Maybe they got lucky, hopping on the train as it was roaring downhill, but lack the skills to go back up.

You cannot carry them along for the ride, and facing that can be difficult. This is one of the hard parts of the small-to-big transition you're going through. You can't continue 'winging it', and yet you need to hold onto the informal, indomitable feel that launched you. Hard stuff. But exciting too.

You're ahead of the game because you recognise the challenge. Now, you've got a glorious piece of blank paper in front of you. The future is yours to design.

What should business school professors . . .

myself included . . . be doing to prepare our students for the global business environment?

Craig Shoemaker, , Iowa

Q Well, exactly what you suggest: they should be teaching students how to lead and manage in different cultures. In fact, we'd make the case that the nitty-gritty of managing people, in any culture, should rank higher in the educational hierarchy.

Over the past two years, we've visited 35 business schools around the world, and we've been repeatedly surprised by how little classroom attention is paid to hiring, motivating, teambuilding and firing. Instead, business schools seem far more invested in teaching high-brain concepts: disruptive technologies, complexity modelling and the like. Those may be useful, particularly if you join a consulting firm. But if you're going to become a real manager, you have to know how to get the most from your people.

Sadly, at most business schools the people teaching about people rarely get much respect. The big hitters are in strategy and finance. We'd say that's backward. Strategy and finance matter, of course, but without the right people running them, they're nothing but theories.

We hope you have the clout to ensure that people management is a core subject in your university's business school curriculum.

If you do, you'll launch your students' careers with a real head start.

Jack and Suzy Welch are the authors of the international best-seller Winning. You can email them questions at Winning@nytimes. com A




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