Working in a startup can feel like a roller coaster. You get pulled from pillar to post. Knowing what you have to do on a daily basis can be difficult. As the founder, it is my job to set this tone, but I often feel at sea myself. Without a rudder. Or a sail. Or sea.
One benefit of working in a large organisation is that you have your job laid out for you. A manager then checks if you’re doing your job. This level of clarity of your daily role is helpful. You know what is expected. When you’re unclear, you flit between tasks. You need constraints that provide the parameters for your work. You then know what to do each day.
The book “E-Myth Revisited” (Michael Gerber – https://www.amazon.co.uk/E-Myth-Revisited-Small-Businesses-About/dp/0887307280) outlines a method for achieving these constraints in a startup. It all stems from your organisation chart. I was sceptical when I read this. An “org chart”? For a startup? You must be mad!
The rationale, though, is excellent.
An org chart outlines all the “jobs” that need to be done in your company. Drawing one provides a picture of the activities your company does. I felt silly at first. We’re a small team. I was drawing positions for people we didn’t have yet.
Gerber outlines the solution for this. In a startup, you work each of these roles. Pick the ones you like (and even ones you don’t). That’s now your job.
You can have 3 or 4 jobs at a time.
For each job, then outline a “Position Contract”. There’s a template for one here – http://www.e-myth.com/media/virtual_training/Position_Agreements/Position_Agreements_worksheets.doc
Write a position contract for each role in your company. Print them off and sign the ones you’re responsible for. You then have 2 further responsibilities as a founder: –
1) Work the role TO THE LETTER
2) Note all areas of discrepancy and amend the position contract to reflect the TRUE nature of the role.
As your business starts to expand, you then “fire” yourself from each of these roles and hire someone who fits the “position contract”. A professional. Someone better than you. Gerber advocates hiring the “lowest possible level of competency”. His model is to aim for “franchise level” clarity for each role. E.g. McDonald’s can hire terrible cooks as their chef’s role is defined so well that AN IDIOT COULD DO IT! I’m not saying McDonald’s chefs are idiots. Far from it. But they are often students who’ll move elsewhere. They have little experience. They can perform the job well as the role has been clearly defined. This keeps costs low.
Still, I think hiring great people is a better option.
Once you have done the job yourself, you know what’s required. You can manage the new person effectively. You also sense when you’ve grown enough to warrant hiring. Too often, startups (especially funded ones) hire before they know what they need. They read somewhere they need a VP of sales, so they get one. They don’t know what that person should do. The person defines their own role. Anarchy ensues.
By following Gerber’s method, you’re being like a scientist. Your org chart and position contracts are your “hypothesis”.
Working the role is your “experiment”. You get data by working the role.
You then analyse the data and improve your hypothesis. Eventually, the best way to improve the hypothesis would be to hire someone who’s a professional.
All startup founders need to be competent amateurs in all areas of their business. You need to “work the role”, get your hands dirty and marry each aspect of your organisation. You need to “know”. By knowing, you can make better decisions down the line. You understand exactly what you’ve got on your hands. You ascertain the pressure points and the car crashes. You can then address both.
- The original thinking for this approach has been derived from the E-Myth Revisited book
- A synopsis of this book is available on Derek Sivers’s blog
- Instructions on designing position contracts are available here
- Setting standards in your organisation is an idea developed from Bill Walsh’s Standards of Performance – he writes about this in his book
P.S. My opening paragraph reminded me of Monty Python’s Four Yorkshiremen. Here they are for your enjoyment. Happy new year!