Does Your Startup Need a Corporate Bureaucracy?

The “E” in CEO is sometimes interpreted to mean Everything. While this might be a philosophy it is also the operational model for many startups. Any time something new needs to be done, it is often the CEO that identifies the need and figures out how to fulfill the requirement. In some cases, this is because the CEO’s skills and experience are best suited to the new requirement. More frequently, it is because the startup doesn’t have the resources or expertise to tackle the new challenge, so it defaults to the CEO.

This assignment of new requirements to the CEO is often appropriate when the need is new. Once the task becomes routine it may be best for the CEO to delegate it to someone else, so the CEO can focus on new challenges. This is where many CEOs have difficulty.

The startup CEO should know the business model, operational philosophy and expected outcomes of each activity better than anyone else. They know exactly how they want this new challenge to be addressed and exactly what outcome they expect. They also tend to “know” that no one else can do the task as well as they can. So the startup CEO tends to hold on to these new responsibilities longer than appropriate.

The solution might involve the CEO documenting the problem, the steps that should be taken to address the problem and the expected results. In the corporate world this type of documentation is known as policies and procedures. The term may be anathema to entrepreneurs who might have fled the corporate world to escape stifling red tape and who greatly value the flexibility to pivot on a moment’s notice. They may view any type of policies and procedures as the first step on the slippery slope to creating a bureaucratic quagmire.

In the corporate world, policies and procedures are often distributed as a collection of professionally edited, highly detailed procedures packaged in a 3 ring binder given to new employees as part of their orientation training. For the progressive startup, a more efficient system might be used. In this case, new policy and procedure entries might be created by jotting down some bullet points published through a wiki, a shared Google doc, or a folder on a SharePoint server. The objective is to use your existing infrastructure tools, making it easy for the author to share the information in their head and for the intended recipients to find and access it. A lightweight system might be a good compromise that provides your company with the benefits of policies and procedures without imposing the traditional corporate overhead.

The benefits of a system like this might include:

– Helping the CEO (or any other policy writer) view the issue more objectively and perhaps result in greater clarity and effectiveness

– Enabling the person responsible for the function to see a clear description of expectations, increasing the likelihood of them producing desired outcomes

– Providing the opportunity for anyone else in the organization to review the policy and provide possible enhancements

Policies and procedures can enable effective delegation, which might ultimately be needed to scale the operation and free up management to focus on the big picture. How might your startup benefit from a little bureaucracy?

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