Fortune
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This article originally appeared in Fortune as part of our Breakthrough series. A company achieving a decade or more of sustained, profitable growth is a rarity: Only one in nine enterprises hits that mark, according to research from top management consulting firm Bain & Company. But there’s a common theme among many of the businesses that succeed: Their leaders have kept (or rediscovered) their “Founder’s Mentality.” Put simply, the Founder’s Mentality encapsulates the mindset and behaviors of a company’s founder in the early days of business—unrelenting focus on customers, willingness to make decisions quickly, and refusal to slow down for unnecessary bureaucracy. But a common problem often arises as a businesses scale, says Dunigan O’Keeffe, leader of Bain’s global strategy practice: Growth creates complexity, and this complexity can overwhelm an organization and stifle it from moving forward. “Emboldened by early success, companies will naturally start adding customers, regions, countries, services, and so on,” says O’Keeffe. “As a result, this very success often leads to losing the signal of what really matters to the customers, and what’s working and not working within an organization. It’s a fascinating paradox.” Companies on their way toward becoming global leaders don’t have to lose the values that helped them succeed, O’Keeffe says, if they learn to embrace the Founder’s Mentality long-term. This approach helps businesses restore their original values, behaviors, and sense of purpose, while addressing the issues keeping them from focusing on customers and scaling solutions. It requires a transformation of both the organization and executive behavior, but it’s possible. Below is advice for reviving the Founder’s Mentality in any modern organization. Steps for getting back to the Founder’s Mentality1. Reclaim the founding mission
The Founder’s Mentality has three main characteristics: a commitment to a bold mission, a sense of frontline and customer obsession, and an owner’s mindset. These are the traits companies have when they are starting out and see the opportunity to disrupt an existing industry, explains O’Keeffe. 2. Reconnect with customersAs a company grows to scale (and goes public), its driving purpose can quietly shift focus to financial results or competition—to increase shareholder returns, for instance, or to take shares from a rival. Adopting the Founder’s Mentality helps leaders balance this focus with attention on what is required for the organization to truly thrive. It helps companies abhor bureaucracy, experiment relentlessly, have passion and curiosity for frontline details, and celebrate employees who do the same. 3. Encourage conflict to streamline decision-making and find solutionsMature companies too often seek out consensus instead of having heated debates over the decisions that matter most. But successful businesses welcome conflict as a way to discover the right priorities and solutions. 4. Elevate the art of business buildingIn the beginning, companies are often “future makers” that are actively identifying unmet customer needs and creating new business models to serve them. But as they grow, they risk becoming “future takers,” says O’Keeffe. This means they are more concerned with protecting their profit pool than capitalizing upon industry turbulence to identify the next big growth opportunity. The path to powering growth“The Founder’s Mentality is imperative for companies who want to compete well into the future,” says O’Keeffe. How thoroughly a company adopts the Founder’s Mentality is an indicator of whether a company is thriving or flailing. “Reclaiming the Founder’s Mentality isn’t for nostalgia purposes. Every company has an exciting history to tell, but the story is not the same thing as the principles upon which the company is built,” says O’Keeffe. “Incredible, odds-defying things happened to achieve scalability, but the Founder’s Mentality isn’t about looking back. It’s an affirmation that the principles are still vital and that the journey is far from over.” If you want to learn more, feel free to get in touch with Dunigan O'Keeffe. |