Monday, August 5, 2013

Guts

In this example, we take a mid-sized company that has been doing pretty well and wants to make the jump.  They've found investors, they have some pockets to dig into.

The investors are interested in one thing:  Return on Investment.  This is the only thing VC people are interested in, and this is a good thing.  They have focus and purpose.  The questions they ask are pointed and follow a consistent theme.  The predictability is easy to understand, easy to prepare for, and easy to accommodate: Make Money and they are happy.  Look Awesome so they can sell you for more money and you are a Rock Star.

A few things they will want to see:
1. Management.  Like, a management team.  I'll get to the kinda like about this inna minute.
2. Infrastructure.  Like, shiny stuff that will make the next buyers go "ooh, ahh."
3. Execution.  Nothing can slip during their watch.  Slippage costs money.  So, manage the hitting of the numbers with a shiny machine and your pockets get really deep.  Miss the target, let the place get dusty, and those wallets are pretty flat.

the Kinda Like:

When you are encouraged to hire the management level resources to have dedicated bodies in the seats, you can expect to hire a Quality Manager, a Supply Chain Manager, someone to capture the metrics ("Business Intelligence"), and a cost accountant.

Now, the tricky part.  You've been doing all these jobs good enough to survive in the past.  You know how to google SPC, Kaizen, Turns, KOMs/KPIs, Cost Cards, etc. like a champ.  You had to do this stuff in the past.  These people you've brought on, some of which come with long resumes at a hefty (to you) price tag, are dedicated to their professions.

It's kinda like moving from simple to complex organism.  The simple organism eats, digests, and moves along.  The complex organism needs a vascular system, a respiratory system, all these "systems." And "cells" deployed for use in a "system" can't be deployed elsewhere.

How to deal with this?  Recognize it is happening.  Recognize that you, as predecessor and primary authority, have to provide the goal, resources, and direction for the systems to work.  If you set a few million single cell amoeba in a jar, you won't get a frog.  Not ever.  Seriously.  If you take pureed frog and put it in a jar, you won't get back a frog.  Not ever.  You can hatch a frog from an egg cell.  The frog grows dedicated systems:  the heart of the frog cannot be used to jump, it is busy pumping blood.  The brain of the frog cannot digest food.  The Stomach cannot directly induce motion.

It might be you don't think the heart and the stomach and the lungs should need told what to do.  That's why you hired in all these "experts" in quality, business intel, and supply chain.  They should know what to do.  Except, it doesn't work that way.  Each one of the systems needs to have definite boundaries, and needs to know what the demands are for production.

Growing from a simple little group to a larger company requires guts:  you need your organs healthy and performing their dedicated duties.

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