In the startup world we talk a lot about assembling the founding team and getting an initial product to market. We begin our companies with collegial groups of smart, well-educated peers who are trusted partners. They generally have the capacity to get things on time, to spec, and within budget without close supervision. It's all peachy.
Then, however, comes the time of scaling up and the necessary addition of worker bees (and I don't mean that to be derogatory) who join your venture for a job and a paycheck. Austin tech leader Josh Baer (@joshuabaer) tweeted today: "In the end, most problems in business and life are people problems." I couldn't agree more. I've heard many others say about their businesses: "People -- you can't live with them, but you can't live without them either."
When your business grows to some size, say 100+ people, you can layer up with HR leadership and other middle managers and begin to really orchestrate your workforce. You've heard the saying: "Only expect what you can inspect." Having some size and the ability to install procedures and systems to inspect the work being done makes a difference. I met recently an outside salesperson that is allowed to work from a home office; but his movements during the day are tracked via his phone, and he is not ever allowed to be in his home office during normal business hours. His employer wants him always to be "outside." There are probably ways to game that, and it seems a bit extreme to me, but it's a primo example of nonstop inspection.
In my view it's easier to be the CEO of Ford than to be the CEO of a business with fewer than 100 employees. You probably don't have a coterie of MBA's to assist your every decision, and your company may still be more of a "happening" than an "organization." If you've got a hot product or service and can power your way through that stage on pure revenue momentum, great. If it's more of a slog, not so great.
Here are some of the employee types you can expect to encounter:
1. Microinstruction driven - If you've done any programming in your career or in your college courses, you know that a machine only does exactly what you tell it to do and isn't going to anticipate the next step. You're going to hire people that are just about like that. They have to be micromanaged on every assignment and will never be able to do more than specifically directed. You can almost do the task yourself more easily than have to translate it into byte-sized increments.
2. Dramatists - You will encounter plenty of employees who just have too much drama in their lives. Everyone is at times afflicted with personal problems or illnesses, but some people just seem to bounce from one crisis to the next. You never know for sure if they will show up physically or mentally for the tasks of the day. In a large company you probably can shift duties and cover to keep the assembly line moving and the customers happy. In a small company you're going to fumble when no one is around to do the job at hand. It's easy to be empathetic in all these situations. "There but for the Grace of God…" However, showing too much grace may mean you are basically taking on a dependent and not being willing to pass that set of problems along to some other lucky employer. If you've hired more than 5 workers, you've probably already encountered one in this category.
3. Dishonest characters - In my long ago retail days I heard the statistic that 1 in 7 employees will steal from their employer. That proved to be pretty accurate in my case. We were handling cash, and we, like all retailers, had to use "secret shoppers" to catch those who were putting that cash into their pockets instead of the register. Employees can abscond with data like customer card numbers and with tangible property. If they have a financial dilemma, perhaps stemming from drug abuse that further clouds their judgment, expect the worst.
4. Misbehavers – In hard charging tech companies with lots of younger employees still very active in the social scene and armed with social media, it's easy for intra-office affairs to become problematic. You've seen recently many public figures that have done amazingly stupid things along that line, so this is by no means age limited. One harassment lawsuit can bring you to your knees in terms of time and emotional energy, not to mention the effect on your workplace.
5. Crazies – This list could go on, but there are just lots of outright crazy people in the workforce. Many of them may have incredible skills that you need, but you'll find somewhere along the way that they will do some incredibly crazy things. For example, I've had senior managers just flat disappear, and the list of war stories in this category is quite long. Unless you are trained in a psychiatric discipline, you may have a hard time spotting personality disorders in your recruiting process, and an even harder time dealing with them later.
Fortunately if you are careful in your recruiting, are blessed with sound leadership skills, and are not hesitant to make changes when you spot these types of people problems, you'll push your way through the tough stages of growth and find more than enough good employees to leverage your company upwards and onwards. This post is meant to be just a tiny bit of a reality check. It's what comes next after you've been accelerated and incubated and have arrived where the real test of your managerial skills begins.
Ben Dyer is a technology veteran, investor, and blogger who publishes TechDrawl, which promotes technology business across the South, is an Entrepreneur-in-Residence at the Austin Technology Incubator, and is best known as the founder of Peachtree Software. He originally posted this on his blog, TechDrawl, and gave us permission to reprint it here.