This text focuses on the obstacles and difficulties that company founders and leaders may experience during a period of rapid growth and success, commonly known as the “Wild Years.” It outlines several potential problems that may arise as a company achieves success, such as overconfidence, lack of direction, reliance on sales, disorganization, and reluctance to change. Additionally, the text emphasizes the importance of a founder’s mindset and behavior in contributing to these challenges and the necessity of transitioning from autocratic leadership to more structured management as the company expands. Ultimately, the text aims to address the common pitfalls and challenges that entrepreneurs and business leaders may encounter during a period of rapid expansion and prosperity.
1. The Triumph and Trials of Wild Years
- The founder achieves success and becomes arrogant.
- Focuses only on opportunities and ignores problems.
- Develops an insatiable appetite for unchecked growth.
After years of relentless effort, the founder has succeeded in establishing the company on solid ground and is now reaping the rewards of that success.
They lift their head from the toilsome work and behold a landscape of boundless possibilities, perhaps with a touch of unwavering optimism.
At this stage of the company’s growth, the business shows remarkable results, particularly in sales. The founder, often attributing these achievements solely to themselves, begins to exude arrogance. They are intoxicated by success, feeling invincible. Problems are obscured by a sea of opportunities. To those who express concerns about the current success, the founder might retort, “You can’t understand, but watch how it’s done!” An insatiable appetite for unchecked growth emerges.
2. No Priorities - Every Opportunity is a Priority
- The founder begins to lead the company in too many directions.
- Sales grow, but planning and strategy suffer.
- Sales become an obsession, overshadowing product quality and customer needs.
The founder starts leading the company in too many directions simultaneously. Arrogantly, they claim that if they succeeded in one venture, they can succeed in another. Gradually, the challenges of previous periods fade from memory. They venture into businesses they know little or nothing about.
Sales are soaring, and due to their arrogance, the founder becomes careless. They don’t plan results; they simply expect them. There’s no strategic marketing orientation; there’s only an insatiable desire for ever-increasing sales. Sales become an obsession. More is equated with better. What and to whom is being sold becomes less important. The fascination with sales and revenue makes the customer and the quality of the product or service less significant. In pursuit of higher sales, the company releases unfinished products, making promises that cannot be fulfilled.
Opportunities are not planned or created; they are merely seized.
The founder dismisses discussions about strategy, planning, structure, marketing, and other aspects as sacrilegious. A waste of time. “If I had done things their way, I would never have achieved this.” The vision that once existed at the company’s inception is now considered a waste of time, with sales (any kind of sales) deemed more critical than thoughtful company development.
In their haste, fixed profit margins are typically set because there is no analysis, only intuition. The analysis of success and profitability is arbitrary and not data-driven. Sales and revenue are increasing, and costs are controlled through frugality principles, but there is no real connection between them. Thus, it’s unclear whether profitability is declining despite increased revenue. How much do increased revenues cost us? What should be invested in and when?
3. The Growing Sense of Omnipotence
- The founder no longer listens to others and becomes increasingly authoritarian.
- Disregards advice and dominates meetings.
- Employees feel helpless and demotivated.
As the leader of the company, the founder stops listening to others because their stubbornness has led to success and success to arrogance. Employees are viewed as subordinates, not collaborators.
In the past, people warned them that their approach was risky. They didn’t listen and proved them wrong. They have succeeded now and don’t need to heed anyone else’s advice. They’ve demonstrated that success comes from ignoring recommendations and warnings. “If I had listened to them…”
Founders (leaders) rarely attend meetings. If they do, they dominate the agenda with items that seem most important to them at that moment. No one else gets a chance to say anything meaningful. The leader bullies, undermines, and personally attacks anyone who dares to oppose them. People sit, listen, and silently wonder, “How can we work with this?”
Why do people tolerate such behavior? During times of crisis, they were threatened with job loss, and during times of prosperity, they were generously compensated by the leader.
Over time, meetings become mere theater, where employees simply pretend to be in agreement and applaud the leader’s ideas, no matter how poorly thought out or dangerous they may be. Later, they gather in offices to figure out how to prevent the disastrous decisions they previously applauded. Thankfully, the founder (leader) has already changed their mind. Ideas, in fact, are not decisions, at least not when presented to subordinates. If someone tries to implement these “wild ideas,” the boss can become furious because they have changed their mind (and expected subordinates to anticipate this change themselves). For subordinates, the situation is a lose-lose. Should they do what they believe they’ve understood, or should they refrain? It won’t end well either way.
4. Perception of Time
- The founder’s perception of time becomes distorted due to arrogance.
- Unrealistic expectations on task completion lead to blaming employees.
- Overtime is imposed as a solution to perceived inefficiency.
5. Unclear Expression
- Founders struggle to express their thoughts clearly.
- Employees are left guessing about expectations.
- Some employees who understand the founder become trusted allies.
This document aims to inspire and motivate managers to prioritize organizational infrastructure and management within its framework.
Additionally, it promotes the effective use of Workanizers‘ managerial tools for the organization and management.
6. The Best at Everything
- The founder believes they are the best at every task.
- Delegating tasks becomes a challenge, leading to micromanagement.
7. Identification with the Company
- Founders often identify themselves entirely with the company.
- New employees are told they work for the founder, not the company.
Founders (leaders) often identify themselves closely with the company they have created. “I am the company. The company is me.” Especially as the company grows and new, unfamiliar employees join, there is a need for the founder (leader) to clarify this aspect. It often goes as far as explaining that new employees haven’t been hired by the company but rather work for the founder (leader), and they better get used to it quickly. This is similar to dictators who claim lifelong ownership of a nation or state.
8. Fostering Distrust
- Founders inadvertently foster mistrust within the company.
- They accuse employees of inadequacy and pit them against each other.
9. Lack of Proper Organization
- The company is organized solely around the founder.
- Communication flows only to and from the founder.
- Primitive organizational structures lead to inefficiency.
The entire company revolves around the founder (leader), with communication radiating from employees toward the central leader and vice versa. There is no teamwork; instead, the founder’s (leader’s) will is imposed upon the employees individually. The organization is primitive.
Over time, as the company grows, such an organization becomes inadequate. It’s like laying the foundation for a three-story building and then realizing an opportunity to sell more apartments, so you keep adding floors up to the sixth. More opportunities for selling even more apartments arise. If you keep adding floors, the foundation will inevitably weaken, and the entire building will collapse. This parallels the ambitions of founders (leaders) built on underdeveloped organizational structures. They continuously push the company to the brink.
Continuous reconstruction of the company is essential; the organizational structure must be adapted and improved, accountability and reward systems must be introduced, and budgets should be implemented. Such tasks require patience for detail-oriented work, discipline, and self-control—qualities often lacking in founders (leaders). Planning is seen as restrictive, defining processes as a waste of time for things that should be self-evident.
Founders (leaders) prefer to discuss growth, ideas, and opportunities rather than “foundations” (which they find boring). They insist on having their topics on the agenda or forcefully insert them to suit their psychological needs rather than the organization’s needs.
Founders (leaders) claim they expect subordinates to support them in problem-solving. In reality, they seek an outlet for their managerial paranoia. They become angry with others, accusing them of not fulfilling their duties. They constantly impose a sense of guilt and use it as a key motivational tool. They personalize problems and attack their own people over them. They fail to realize that both they and their subordinates are victims of an unproductive company system (a weak foundation).
10. Poor Organization as a Result of Rapid Growth
- Rapid growth leads to an inadequate organization.
- Hiring is chaotic, qualifications vary.
- Managers become overwhelmed and lack clear roles.
Until recently, a company relied on the founder (leader) as the central figure and a few employees who acted as their extended arms without forming significant management teams. There were no organizational charts, or if they existed, they were clumsy and often changed haphazardly. Job descriptions didn’t match reality because jobs were assigned when the founder (leader) randomly encountered someone in the hallway (and “that person is just one of the many with not enough work to do”). Tasks were temporarily delegated so that the founder (leader) could seize opportunities quickly. There was no attention paid to organization. What was supposed to be temporary was forgotten and became permanent. No one remembers why they’re supposed to do exactly what (not even the leader, who was in a different mood that morning). Everyone does a bit of everything, and the company resembles a plate of spaghetti. It’s incredibly complicated to know who is responsible for what and what results they should deliver. The system has become highly unproductive. Paradoxically, the desire to burden all subordinates to the maximum (and beyond) comes from the lack of a system.
Managers were hired in a chaotic manner.
In the company, as there were no systems and established policies, people were hired at different times under different agreements. Some were qualified, and some were not. There was no time set aside for the job to orient people to what each person did and to reward them based on evaluation. When the owner had money and was in a good mood, they might reward a manager with a raise, but this was arbitrary, based on an assessment, not measured performance.
Managers, under pressure from the owner and due to poor organization, jumped from task to task, trying to cover all areas. Managers, like the entire company, lacked a system and focus. The company followed a spaghetti principle where people shared responsibilities and tasks overlapped. The company is organized around people, not tasks. Plans were not made, and the organization was absent.
This document aims to inspire and motivate managers to prioritize organizational infrastructure and management within its framework.
Additionally, it promotes the effective use of Workanizers‘ managerial tools for the organization and management.
11. Reactive Behavior, Not Proactive
- The company is reactive, driven by external circumstances.
- Proactive initiatives are discouraged.
- Innovations are only pursued when competitors prove their success.
The company (and its sales) operate reactively, responding solely to external circumstances as they unfold. The company doesn’t control its environment; rather, the environment controls the company. People in the company are driven by opportunities rather than creating them.
The founder (leader) emphasizes what not to do and learns from their mistakes. A proactive approach is considered a waste of money, so everyone refrains from making proactive suggestions. Innovative ideas are only considered after the competition has introduced them to the market and proven their effectiveness. Then, the founder (leader) chastises employees for not being proactive enough and pushes them to do the same. Results may come, but they are never as good as the competition that proactively entered the market.
12. Avoiding Responsibility
- Tasks are assigned based on availability, not competence.
- Responsibility is unclear, leading to problems.
- Founders resist delegation of decision-making.
Founders (leaders) assign tasks to people based on availability, not competence. It’s unclear in the company whose responsibility is what (and responsibility was rarely sought in the first place; only execution mattered). Managers (if there are any, besides the title) don’t have a clear understanding of what’s happening amid the spaghetti-like organizational structure. They delegate responsibility to someone at the other end of the spaghetti if they even know if someone is there. Nobody addresses managers because the only one who makes decisions is still the founder (leader).
The founder (leader) finds this comfortable because they were never willing to let managers make decisions, organize, and manage as managers should. However, they soon realize that there is too much work, communication goes over their head, and the organization is concentrated solely around them. Seeing the company slipping out of control, the founder looks for a savior, someone who will take charge and free them from the chaos.
13. The Wild Years Problem
- A crisis often triggers the recognition of problems.
- The need for rules and policies becomes evident.
- Emphasis shifts towards administrative subsystems.
Usually, a major crisis is required to make the founder realize the need for rules and policies in running the business. This crisis could involve losing market share, a major client, an investment in a large project, or an unrelated business venture. For the first time, arrogance somewhat subsides, and the need for rules and policies in running the business becomes apparent. The focus shifts to administrative subsystems.
When the founder (leader) notices the lack of attention to administrative systems and realizes that they are the cause of the deviation known as the “founder’s trap,” they become aware of the problems the company has faced for a long time, despite success in sales.
14. The Founder (Leader) is Both the Greatest Asset and the Greatest Risk of the Company
- Founders become tired of the constant challenges.
- They seek relief from daily management but don’t want to let go.
- Conflict arises between their desire to step back and their reluctance to relinquish control.
The company has grown to a point where the founder (leader) can no longer implement their personal style and philosophy everywhere. The founder (leader) can’t do everything alone anymore. This is when the first attempt at decentralization of decision-making occurs. However, things often don’t go well, and the reason is, once again, the founder.
Rules and policies are introduced in the company, but the first person to break them is… the founder (leader).
The founder (leader) delegates autonomous decision-making authority but issues a warning: “Before making any significant decision, consult with me, and be sure not to make a decision I wouldn’t make.”
Decentralization of a company can’t succeed without a control system. A control system determines what decentralized units can and cannot do, what their goal is within the overall value-creation process for the customer, and which indicators guide everyone in the company on whether decentralized units are moving in the planned direction.
This type of control subsystem, which still needs to be fully developed, is often disrupted by the founder (leader) because they respect it the least.
People take the initiative, but founders (leaders) feel that the company is threatened and uncertain when employees’ thoughts, values, needs, and priorities don’t align with their own.
Transitioning from autocratic centralization to decentralization is a daunting task for founders (leaders). In essence, they tell their managers to make only the decisions they themselves would make. This isn’t decentralization, and the company doesn’t move toward the desired change. It’s self-deception on the part of the founder (leader) that they’re trying to address the “founder’s trap” problem they’ve become aware of.
Managers can’t make decisions as founders (leaders) would. Not even the founders themselves would make the same decision twice on the same matter in two days. The result is that managers, after numerous conflicts with the founder (leader) over their decisions, become passive (they lose their initiative) or the founder (leader) takes away their authority and resumes decision-making. After some time, the situation repeats itself – managers are given decentralized decision-making authority, only to have it taken away again.
The founder (leader) feels betrayed, and both they and the employees feel frustrated, powerless, and opposed to one another.
15. Founder (Leader) Fatigue
- Founders grow weary and seek new outlets as the company no longer aligns with their original vision.
- They face a conflict between wanting to escape day-to-day management and retaining control.
- Some founders intermittently intervene in organizational matters, causing confusion and anxiety among managers and employees.
Success in sales continues, but every founder (leader) becomes weary of it all and seeks an outlet for their entrepreneurial energy, or at least daydreams about other activities (social organizations, travel, politics, new business ventures, real estate…). The company no longer aligns with their vision; it’s no longer the nimble, small, and agile entity it once was when it resided solely within one individual.
This brings to the forefront the complexity of the reorganization problem. Founders (leaders) want to escape day-to-day management but are unwilling to relinquish control. They face a deep internal conflict.
One of the worst solutions that founders (leaders) often take in this situation is to allow the organization to operate independently and occasionally intervene to “blame it” based on “their character” to maintain the status quo of their position, which is becoming obsolete. Thus, founders (leaders) distance themselves from the company but return periodically. What happens then? They notice that changes have occurred that they don’t approve of, and they release all inhibitions. They always have better and newer ideas. These ideas should be anticipated, known, and followed by subordinate managers. In a matter of hours, power re-centralizes around the founder (leader). Everything is criticized, and they disappear from the company again for a while. Managers and employees are left wondering what they should or shouldn’t do. Everyone in the company becomes anxious. It’s risky to assume what the founder (leader) wants to be done. Should anything be done at all? It’s wrong if you take action, and it’s wrong if you don’t. If you do something – you’re in trouble. If you do nothing – you’re in trouble.
This document aims to inspire and motivate managers to prioritize organizational infrastructure and management within its framework.
Additionally, it promotes the effective use of Workanizers‘ managerial tools for the organization and management.
16. The Problem Is Becoming More Evident, but Solutions Are Unclear
- The situation resembles family conflicts as grown children assert their independence.
- No one wants to change first, expecting the other party to change.
- The organization must transition from founder-led to institutionalized leadership.
The situation somewhat resembles a family where the children you raised have their own will and want to make decisions about their lives. They refuse to listen, resist, and assert their independence in their own way. In a company, employees are not children; they work for a salary and may not find it worth resisting. Founders (leaders) feel unfulfilled; they want to leave but can’t. There is no one who can replace them. Even if there is, founders (leaders) fear that someone will take their company and steal their dreams. This is a dead end. Everyone expects the other to change.
Everyone needs to understand that the entire organization needs to change. It should also be understood that they can’t change it on their own. The outcome depends on who is integrating these conflicting desires. So far, founders (leaders) have been the integrators. As the company grows, one person can’t find enough connections to support the company’s future size.
The company must transition from intuition-based management to professional, planned management driven by processes to preserve its hard-earned gains.
The company, characterized by arrogance, uncontrolled growth, centralized decision-making, lack of systems, budgets, policies, and structure, is on the brink of a major crisis despite all its sales success.
The founder (leader) must say, “I’m willing to abide by the company’s policies, not have the company conform to my policies, which often change arbitrarily. Policies that apply to others should apply to me, too.”
Some founders (leaders) have the role of company presidents but still try to be the main salespeople, accountants, designers, financiers, and more. These founders (leaders) must clearly and definitively detach from their leadership style. Delegating authority without losing control is not easy to achieve. Founders (leaders) may now have the desire to do this, but they don’t know how, and they fear the consequences.
17. The Solution Lies in Depersonalizing the Integration Role
- The management function must be systematized and institutionalized.
- It’s impossible for one person, even if they are a great founder and leader, to see the whole picture, especially if they are in it.
The management function must be systematized and institutionalized. Why shouldn’t someone else do it instead of the founder (leader) as before? It’s impossible for one person, even if they are a great founder and leader, to see the whole picture, especially if they are in it.
To preserve the company’s hard-earned profits, the founder (leader) must say, “I’m willing to abide by the company’s policies, not have the company conform to my policies, which often change arbitrarily. Policies that apply to others should apply to me, too.”
18. Professional Managers?
- After attempting decentralization of decision-making, founders often hire professional managers to guide them through the process.
- However, these professional managers may not align with the founder’s style, leading to termination or dissatisfaction.
- The search for a suitable manager continues, causing instability in the organization.
After attempting decentralization of decision-making and granting and revoking authority from managers, founders (leaders) often decide to hire a professional manager to guide them through the challenging process of decentralization. However, these professional managers cannot be an appendage to the founder (leader), and they soon realize that they are different from the founders (leaders). The professional manager arrives on time but also leaves on time. They spend their entire day in their office, working on a computer, going through papers, and analyzing data. They are not particularly open or friendly, and they don’t endear themselves to employees.
The founder (leader) concludes, “This person isn’t like me. If I had run the company like them, we would never have come this far.”
And…
The professional manager is terminated, and the founder (leader) brings in another type of administrator: “someone like us who doesn’t sit in their office all day.”
However, even this is not the solution. Perhaps the new manager is likable to the founder (leader) and employees because they now engage in sales (among other things). But there have been no necessary changes in management. Systems aren’t established, and the founder (leader) is not controlled, which suits them but is also recognized as not what the company needs. The company needs someone stronger and more decisive, which will definitely limit the founder (leader) and disturb the organizational culture. This is uncomfortable. The founder (leader) feels that they are in danger within the company and is already seeking the next (fourth) manager.
19. The Cycle Repeats
- The founder (leader) keeps searching for a savior.
- New managers face the same challenges as predecessors.
- The company remains trapped in a never-ending cycle.
The founder (leader) is stuck in a never-ending cycle. They keep searching for a savior, someone who can magically resolve the company’s problems, relieve them from the burden of daily management, and bring about change without disrupting the status quo too much. This search for a savior is a recurrent theme.
New managers come and go, facing the same challenges as their predecessors. They are expected to navigate the complexities of the founder’s (leader’s) management style, which includes arbitrary decision-making, micromanagement, and a lack of clear policies and systems. They may be likable and have valuable skills, but they are bound to confront the same hurdles in a company that resists change.
The company remains trapped in this cycle, oscillating between success in sales and organizational chaos. While sales may continue to grow, the underlying issues persist, making it difficult to achieve sustainable progress.
20. A Turning Point
- Recognition of the need for profound change.
- A shift from founder-centered to system-centered management.
- The path toward sustainable growth and stability.
At some point, a profound realization dawns upon the founder (leader) and those within the organization. The need for change is undeniable. The old way of doing things, centered solely around the founder’s (leader’s) personality and decisions, is no longer sustainable. The company has grown beyond the capacity of any single individual to manage effectively.
This turning point marks a shift from founder-centered to system-centered management. The founder (leader) recognizes the importance of depersonalizing the integration role and establishing clear rules, policies, and organizational structures. They understand that the company must evolve from a chaotic and reactive entity into a well-organized and proactive one.
This transformation is not without its challenges, as it requires relinquishing control, embracing systematic approaches, and empowering managers and employees. However, it is the path toward sustainable growth, stability, and the realization of the company’s true potential.
This document aims to inspire and motivate managers to prioritize organizational infrastructure and management within its framework.
Additionally, it promotes the effective use of Workanizers‘ managerial tools for the organization and management.
21. Embracing Change and Growth
- A willingness to embrace change and adapt.
- The founder (leader) fosters a culture of continuous improvement.
- The company’s success is no longer solely tied to one individual.
In this new phase, the founder (leader) and the entire organization display a genuine willingness to embrace change and adapt. They understand that growth and success are not static but require continuous improvement and evolution.
The founder (leader) becomes a champion of this transformation, fostering a culture that encourages innovation, collaboration, and the pursuit of excellence. They empower managers and employees to take ownership of their roles and responsibilities, confident that a well-structured system will guide their actions.
As a result, the company’s success is no longer solely tied to one individual. It becomes a collective effort where each member of the organization plays a crucial role in driving growth, efficiency, and sustainability.
22. The Legacy of Transformation
- The company’s legacy is no longer just about sales figures.
- A culture of adaptability and resilience endures.
- The founder’s (leader’s) vision lives on through an empowered organization.
The transformation of the company leaves a lasting legacy, one that extends beyond impressive sales figures. The company’s legacy is now defined by its ability to adapt, evolve, and thrive in a changing business landscape.
A culture of adaptability and resilience becomes ingrained in the organization’s DNA. Managers and employees are equipped with the tools, systems, and mindset to navigate challenges and seize opportunities.
The founder’s (leader’s) vision lives on, not as a singular force but as a guiding principle that empowers the organization. The company continues to grow, innovate, and make a meaningful impact, all while honoring the spirit of its founder (leader).
Conclusion
- Reflecting on the journey from triumph to transformation.
- The founder’s (leader’s) evolution and the company’s enduring success.
- A testament to the power of change and growth.
In reflecting on the remarkable journey from triumph to transformation, we witness the evolution of a founder (leader) and their company. From the heady days of initial success and unchecked growth to the challenges of arrogance, micromanagement, and chaos, the story takes a turn towards profound change.
Through the recognition of the need for system-centered management, the willingness to embrace change, and the fostering of a culture of adaptability, the founder (leader) and their organization achieve enduring success. It is a testament to the power of change and growth, reminding us that even the most entrenched patterns can be transformed into pathways to excellence.
As we conclude this documentary-style exploration, we are left with a profound realization: the journey from triumph to transformation is not just a story; it is a living example of what can be achieved when individuals and organizations are willing to evolve, adapt, and write their own legacies of success.