From Startup to Scale-up: How to Build Your Company to ״Be Big״

Many of us familiar with Google's famous practice - The company crossed the 100,000 employee mark long ago, and despite this, every Friday there is still a meeting with all employees live streaming where you can ask the founders questions directly. The company's leadership have changes over the years, but the tradition continues in a different way.

Google is a very innovative company. In the field of corporate communications, many companies also follow its advanced practices. In the context of scale-up, this is another way to maintain a robust mechanism that uses technology and touches all employees, while maintaining a certain amount of the intimate experience of the early days.

Even with twenty people, it is not easy to create alignment within the company, but it will be much more complex with fifty or a hundred people. Startups don't like processes, and rightly so. It can make us heavier and slow down the pace. After all, this is exactly our advantage - we develop in a month what large companies develop in a year. Another source of resistance to the institutionalization of processes and tools is the desire not to lose our unique character, which is part of the secret of our success so far.

"...we hate processes...we don't want to be corporate"

On the other hand, the window of opportunity is limited: we have to run fast, but more things are happening at the same time, and the level of coordination is critical to success. There is a feeling that we must make this leap, we must create more "scale," but we are very afraid of "what will it do to us..."

So how do you do it? One key is to be selective - I will present three components of alignment that are required early on: "Organizational communication", "Managing by objectives", and "Workforce planning".

Another key is to build basic tools that are as uncomplicated as possible. A startup has no tolerance for, nor is there a need for, complex organizational tools. Finally, I will also try to demonstrate how these tools can be "leveraged" to preserve the company's unique character within its growth trajectory. For the sake of example, we will describe a startup whose founders consider Partnership, Customer focus, and Daring to be values that guide them in life and in leading the company they founded.

Let’s start with organizational communication: The company is growing, and it’s no longer possible to gather everyone in one room in the morning when you return from New York to update them on customer installations. It’s cool and casual, but it doesn’t work anymore when you’re operating in four offices across different time zones.

The concern is that in trying to maintain the modest and intimate approach you’ve always had, information might become limited and uninspiring. If organizational communication was once informal and personal, it must expand over time (without sacrificing the personal touch) to include electronic broadcasts. This is also a necessary condition for maintaining visibility between teams in different offices.

Given the fast pace of startups, such meetings should be held monthly or even weekly. One of the founders of HoneyBook shared that all employees meet four times a week (Monday through Thursday). This frequency enables more continuous communication, not just top-down, allowing all employees to express themselves and engage with various business and organizational issues.

Due to the attempt to remain modest and intimate, information may be limited and uninspiring

There are other ways: Mark Pincus, founder of Zynga, used to hold meetings every Monday morning with all the employees who joined that week, even when the company had close to a thousand employees. Brian Chesky, founder of Airbnb, still sends an email to all the company's employees every Sunday. What they all have in common is the attempt to keep employees connected to what is happening frequently and directly - without twenty intermediaries down the management chain.

This approach doesn't end with meetings of all employees. A few months ago, I held a meetup on organizational scale-up with one of the fastest-growing Israeli cyber security firm in recent years. The COO of that company presented a number of tools provided to managers to improve management communication. They built templates for a new employee announcement, a promotion announcement, or an employee departure announcement. The logic is clear - a R&D team leader is strong in technology, less so in writing organizational announcements... Once he has a template, he flows, adds a little personal touch, and everything it's all good.

If we go back to the same startup example that was presented at the beginning, we said that Partnership, Customer focus, and daring are its “operating principles.” So, while not all employees will physically experience how the two founders stayed up all night to solve a customer problem. On the other hand, the CEO can certainly compliment an employee who excelled in customer service, in public, at the weekly company meeting that is broadcast live. Impressive collaborations and significant business breakthroughs made possible through daring will be presented to all employees on Slack so that everyone will understand that this is the formula for excellence in this company.

The importance of strong Planning model

Another key is planning. A few months ago, I went with a startup leadership team to a three-day management workshop. Together with the CEO, we decided to start with a half-day of working on relationships - getting closer as a team, building trust in preparation for two days of strategic planning. To finish, we planned a half-day of working on partnerships through mutual feedback within the management team.

The first part was excellent and the feeling was that the team was mentally prepared for the planning discussion. An hour or two into the planning session, we realized that we were in trouble. The idea was to discuss several strategic alternatives, make a decision, and draw up a work plan. The problem was that the team entered the planning process without a sufficiently practical organizing model that translates strategy into annual goals and a prioritized work plan. As a result, the team went around in circles without a breakthrough. The last part of the mutual feedback went in a different direction, more important in light of the experience created - a kind of lesson learned about how the team could have gotten more out of the event, and about the role of the leadership team in establishing planning mechanism and work plan.

When we get to the bridge, will we cross it?

When you lead a startup, you have to run fast. You will win if you are fast, so complex processes should be avoided. At the same time, planning requires time and thought. You will continue to work in short sprint loops, but the direction and roadmap should be there. This way, you will increase the confidence that your people are aligned with the main business challenge and are working on exactly what is important at the moment. There is no shortage of good platforms: many startups are adopting the OKRs model, primarily associated with Google. Recently, I’ve seen more companies using the V2MOM method, which Marc Benioff developed during his years at Oracle. As soon as he founded Salesforce, he implemented this method with the first co-founders—and he still keeps the original document to this day. According to him, this approach helps clarify where he’s headed and ensures that the rest of the company is aligned with the same directions.

As with any tool, it's less important which tool you choose than how committed you are to using it. Ultimately, the tool guides you to make business decisions, so it's very important to collect relevant information and stick to a fixed calendar - for example, a quarterly OKR process.

Workforce planning – an excellent opportunity for the VP of Human Resources to refine the "talent development plan" in accordance with the company's business needs.

The idea is to constantly maintain a staffing plan that is based on and actually enables business growth. This is not trivial - we say that a startup should recruit exactly what we need right now, and that is generally quite true, so why do we need to plan ahead? Simply because product development sprints are around two weeks, while recruiting new people for a company often takes two, three, and four months. Hence, it is essential that I know today what knowledge and professional skills I will need in 3-6 months. I simply need to know where I am going: what technological and interpersonal skills I need to support the company's growth.

This process is an excellent opportunity for the head of Human Resources to refine the "talent development plan" in accordance with the company's business needs. The challenge is to lead, with the relevant managers, each in their own field, the translation between a business goal and human capital needs. It's not just about recruiting, but about a number of parameters such as changing organizational structure, internal learning of new skills, and of course building new profiles for internal or external staffing.

Closing the Circle: Returning to Core Values

Let's go back to the same startup that was initially presented and whose core values are Partnership, Customer focus, and Daring. To this day, the founders have "lived" and demonstrated them directly. Looking ahead, synchronization of goals between the employee is a great way to create partnership. Their customers' needs are constantly evolving and becoming complex. That's how it is in startups. Workforce planning can be a great way to make sure that they are putting the knowledge and skills in front of their customers to maximize the value they receive from our product.