The intangible cost of under-sizing roles in a high-growth organization

In a company I once worked for, one of the businesses grew much faster than we had anticipated. The complexity of operations and management increased multifold. We noticed that the operating and customer metrics were gradually beginning to suffer. Breakdowns and escalations became a regular affair. Senior management involvement increased significantly in day-to-day operations. It was evident to me that the business head and his entire first line had suddenly become undersized and were struggling to cope with complexity and scale. The business head thought that the fault was with his some of his first line managers who he thought were unable to cope. Yet, he was doing nothing to either replace them or coach them intensely.

For a long time, the senior management too found it convenient to accept the argument that the problem was with the business head’s first line. One or two changes were made, but the changes were half-hearted and limited by the ability of the business head to assess and select the right candidates. Things did not improve. Customer complaints kept increasing and there came a point when it was becoming clear that replacing the business head was important for cleaning up the mess. This is a pretty standard symptom in high-growth organizations – roles outgrowing good incumbents. Yet organizations take a long time to figure this out. I call this a “mature company syndrome” – in mature companies, roles rarely outgrow incumbents simply because the complexity does not increase faster than an incumbent’s ability to learn to handle additional complexity.

In one of the other companies, we had a business head who appeared right-sized for the role, but he chose to manage the sub-units of the business with relative novices who would not challenge him or push the envelope. Given the growth of the business, it was evident that this wouldn’t do. He needed a bunch of seasoned leaders under him to manage these sub-units independently. This feedback was given to him, but he didn’t seem to figure out the seriousness or the consequences. The business began to go through problems – each not big enough to attribute it to the generally known fact that the team was undersized. Though in this particular case, the business head was reasonably sharp in his understanding of business issues, but just couldn’t seem to figure out how things could slowly come apart, because though the next line of leadership was good, it was not good enough. The next line of leadership was reasonably bright but was severely constrained by lack of experience in managing large teams and with a lot of gaps in management skills. Here too some hard calls were taken the moment one of the large clients cancelled.

Does one have to wait for things to break down completely before doing something about it?

Right-sizing roles, especially key roles, is a very important decision in a company that is scaling rapidly. Most companies don’t get it right because they don’t think about it consciously. If you are the ‘hiring manager’, you need to pay special attention.

Right-sizing a role is not about getting the right person for a role. Getting a right person for a role is step 2.

Step 1 is Right-sizing the role.

Right-sizing the role is about deciding the calibre of the person you want for the role based upon an intelligent evaluation of the kind of problems that the role holder may need to deal with based upon the anticipated growth and competitive scenarios.

Take some examples:

• If you have a customer service team in your company, you need to figure out whether customer service is a differentiator or a cost. If it is a differentiator, get someone who can make this service a differentiator to lead it. Get someone who does not need to be actively managed to lead it. Get someone who can take this function to an altogether different height to lead it. On the other hand, if you believe that customer service is a cost and not a strategic differentiator, then get someone who will maintain status-quo. The worst thing that can happen is having a desire to make it strategic but not knowing what calibre of leader is needed to give it the strategic edge.
• If you sense that your technology projects are not keeping pace with the requirements of the business with slippages in timelines and excessive defects/bugs, then you might want to check the gaps in the technology team. If you have an otherwise good CTO, you may want to check the quality of his first line. In one case, we found that the next line of leadership was missing. The CTO was trying to over-optimize. All the Tech Leads reported to him and ate too much into his time. The CTO was struggling with solving problems that should never have come to him. This was affecting both the productivity as well as quality. The solution then may be to create a layer of Engineering Managers.

Getting the right person for a role, after you have right-sized it, isn’t such a big challenge. It is about the assessment process and reference checks. One can make mistakes even on getting the right person for a role and the consequences could be bad, including setting the journey back by many quarters (for key roles), but that’s not what I am talking about here in this post.

The symptoms that a role reporting to you has not been right-sized are usually the same:

• You end up spending a lot of time on follow-ups, coaching, and problem solving
• Problems keep recurring the moment you take your eye off – either the same problem keeps reappearing or new ones keep coming up
• The team does not seem to have the capability of proactively spotting problems that could come up; or proactively anticipating what could go wrong
• The team has lots of data but no insights
• The team needs to be constantly pushed to think out of the box
• If you go slack on your reviews, things begin to slip immediately
• The team never seems to see the bigger picture or discuss a roadmap

As a hiring manager, it is important for you to make the right choice. If you are under pressure to deliver extraordinary results in accelerated time frames, you need to hire extraordinary people who can work independently. I have seen function heads crushed under the burden of expectations from stakeholders (internal and external) and still not figuring that the solution is in being able to replace the current incumbents, or hiring new people who can work with minimal supervision, and who have the ability to independently strategize and shape their teams. Instead, they end up working harder than ever before and burning out faster in the process.