Growing Pains

Marty Cagan argues that a company growing rapidly from startup to large organization faces stress, and that practices and people who drove early success can later hold it back. He suggests leaders who excel at startups are often not the ones who scale well, because the skills and temperaments differ. Using decision-making as an example, he shows how informal, all-hands debate that works early becomes meeting overload or micromanagement as headcount grows and people expect involvement in everything. Because larger organizations have more to lose, they drift toward protecting existing assets rather than pursuing new ground. Cagan concludes that rapid growth can be managed, but only if leaders recognize the new requirements and deliberately adjust the organization, processes, and staff.

01Key takeaways

• Recognize that the practices that enabled early success may become the bottlenecks as the company grows.
• Expect that founders and early leaders may not be the right fit for the next stage, and plan for that possibility.
• Adjust decision-making so people are empowered to decide rather than waiting for all-hands consensus.
• Avoid the trap of endless meetings and consensus-seeking by clarifying who owns each decision.
• Deliberately redesign processes and organization as the problems the company faces evolve.
• Help staff adapt their working habits, since people accustomed to startup involvement may resist the change.

02Key sections

Growth stress on the organization

Rapid growth is positive but strains people and organizations. Practices that once fueled success can later become obstacles as the company scales.

Different leaders for different stages

Startup and large-company environments demand different skills and personalities. Few leaders can successfully shift between them, which is why founders are sometimes replaced.

Organizations solve problems

Structures should change as the problems a company faces change. Decision-making is used as the illustrative example of an operation that must evolve.

Decisions break down at scale

Startup decisions made by gathering everyone in a room stop working as headcount and meetings grow. Leaders then either override decisions or micromanage, causing paralysis.

Managing the transition

Leaders must anticipate the new demands of larger organizations and deliberately adjust structure, processes, and staff behavior to handle them.

03From the post

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Summary and takeaways written by PM Atlas; quotes are short excerpts. © the original author.