In any evolution of an organization from small to big, the list of challenges is never short. I have written about this here.
A small company is not a big company in small. In the growth from small to big, the trouble is in the middle
Every successful company’s growth contains seeds of failure. At some point, organizational complexity could outweigh the business benefits
Not only in the growth of the business itself, its operational aspect, but also in the organizational and human capital side, the world looks pretty different depending on your size. This may seems obvious, but people tend to look at this progression with uncritical eyes. In my consulting experience, people’s thinking is often driven by events. Stuff happens, as Donald Rumsfeld would say. Then we think.
Sometimes business start with a few people. Success (or money) come in. Suddenly there are more people, then lots and lots more (how did that happen?). The next thing you see is an HR department.
Growth and increased complexity tend to point to the direction of new support systems. The trouble is that all support (functional ) systems are meant to support something big, otherwise they will be small or non existing. So, if the model is ‘the big company’, then the ‘structure’ pops up: HR department, CFO, COO and other Cs, perhaps a Strategy Unit and a growing number of people with a title that starts with two letters: V.P. Companies with an overgrown population of Chiefs and rather invisible Indians are far from infrequent these days.
Managing complexity is not the same as managing a complicated business. A very conventional view, by no mans the only on this topic, is that complexity has to do with the number of components of the system, whilst complicated implies difficulty. It is a reasonable working differentiation. We can make something that is simple very complicated by applying solutions unfit for purpose. On the other hand, we can have something complex, well managed and not complicated.
Simplicity is not reduction to little bits. Reducing something complex to something simple is very politically and managerially correct, but it adds more problems that it tries to solve. An elephant is an elephant, not a combination of legs, tusk and other parts that can be glued back together, once taken apart. What we need are Masters of Elephants, not Dissectors and Simplifiers unable to reconstruct the elephant but providing excellent knowledge of those legs and tusk.
My intention is no to trigger a philosophical discussion about complex and complicated. My fear is that by putting a premium in simplification, we miss the elephant altogether.
At many points of this evolution towards organizational complexity, we should call time out and ask questions such as: do we really want to go that way? How can we be effective and successful without the traps of Big Company Structure? What are we making more complicated than it is? What’s is complex in itself that should not be reduced to pieces? Who knows how to manage complexity? Has anybody seen the elephant?
It may be complex. It does not have to be complicated
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