When you start, you create two things. One is your product, the other is your team. The initial product can fail, but if you assemble a innovative and productive organization, your next iteration is likely to succeed.
To build a great team you need to cover all critical functional areas, hire for cultural fit, get a productive and inspiring workspace, and be good at management and communication.
Action steps
- Define functional structure of your team. What results and metrics everyone is responsible for?
- What are your key management tools? Do you get enough open feedback on your management style?
- Define and promote the key elements of your team culture.
Team structure
Identify areas of responsibility for every team member. On one side you have day-to-day operations including customer service, bookkeeping, supplier relations, and support. On the other side there is a future-focused team working on product development. Every major activity should have someone responsible for it. A team member can run from one to five major activities. Typically, there are from five to fifteen major functional areas at the start.
Here is a quick test for maturity of your management structure. Pick any functional area and ask your team: “Who is responsible for it?”. If there is no clear answer, you delegation structure is broken. If the team leader is responsible for more than five functions, you have suboptimal team structure.
Founders should run the most critical functions. The least delegate-able tasks include people (recruitment/motivation), product management (what to build), promotion (sales/marketing), and resource control (budget and deadlines).
Consider removing your project leader from day-to-day operations. This is not a hard rule. E.g. Salman Khan is still a primary teacher at Khan Academy five years after it was started. But in most cases, the founder has to transition from product development to management, financial control, marketing strategy and recruitment. Once you have five people on the team, start looking for new leaders to take over business operations and product development.
Cultural requirements for employees
Culture fit is critical. Look for people who are most effective in a new company environment.
Require initiative. You can not build a great new product just on great execution. There too many details and low level decision. Look for people who would completely cover a certain functional area and take full responsibility for it. Encourage argumentation and thought independence and avoid chain-of-control culture.
Set productivity expectations. Talent is not enough. Done is better than perfect. Perfectionism is for big companies, good enough is for startups.
Work with people whom you like. Would you be happy to take neighbor seats on a long flight? Is this person positive and constructive, not cynic? Is there more honesty or politics?
Management
Meetings. There should be absolute minimum number of meetings. Full team update (e.g. weekly). Planning sessions (whenever needed, probably once a month). One on one meetings can happen on-demand at the start and then move a fixed schedule.
Informal team gatherings like lunches, team building adventures are good, but not critical at the start. Creating a market winning product is the most effective team building experience.
Praise in public, criticize in private. There is a common technique called “sandwich style”. Say what you like first, then point out to problems, then conclude with constructive suggestions for improvements. The negative part should be focused on the work itself, and not on employee personality. The sandwich delivery should be genuine. say only what you really believe in.
Organize control around key commitments and weekly reports. What are the key goals for every of your functional areas? Are the recorded? Are they timed? Is there a responsible person for each goal?
Ask for weekly reports (done this week, planned for the next week, any concerns). Five to ten sentences in total, wiki or email. Weekly reports feel like bureaucracy, but they really help. Tie salary increases to regular employee reviews that are based on weekly reports.
Encourage honest communications. The bad news should travel faster than the good ones. Nobody should wait for “a good moment to discuss this thing”.
Encourage open feedback to project leader. How often do you hear an opinion that you initial disagree with but then realize that its true? Listen hard. Act on what you hear.
Manage professional development of your employees. Learn about their ambitions and motivation. Synchronize their interests (compensation, new responsibilities) with company development. Is your company the best option for them? Invest in your team: pay for professional development courses and conferences.
Workspace
Invest in workspace. It is more important than first-time entrepreneurs may realize. It affect work commute, productivity and team communications. When it comes to office rent, do not be cheap and save money on something else. Do not take pride in finding the cheapest option. It is better to work from an inspiring shared coworking space than from a cheap private office in the basement.
Invest in health. Be smart about office snacks and lunch options. Excess of sugar, cookies, and pizza take years from life expectancy of your employees. Are there any exercise options around, like yoga or gym?
Have fun. Do you have any interesting guests visiting your company? Organize celebrations for major milestones. Have interesting options for taking a break. Bring art to your workspace.
If you do not take any action, company culture will form by itself. Control the key elements from the start and postpone other things for the future. At this moment, focus on survival and productivity, and not on company’s cafeteria and fancy benefits.
Once you get to sustainability and growth, there are more resources to get everything right and build a foundation for long-term success.
This article is a part of Earlydays, an open guide for first-time entrepreneurs.
Written by Yury Lifshits — yury@yury.name — @yurylifshits
