1 Head is Better than 2, or 3, or 4, or etc.
1 Head is Better than 2, or 3, or 4, or etc.
Your probably saying to yourself, “This Brian guy should have went to third grade math class instead of sniffing glue.” Well I’m not talking about just numbers here. I’m talking about the equity of decisionmaking.
In my first business, we had two parnters and one employee later on. We had two main decision-makers, myself and my partner. Usually everything operated smoothly because we saw eye to eye on a lot of things. Every once in a while, we had a divergence and the stand still was enormous. We would spend days discussing and researching and then finally go in a direction. Often times, the other person would have to be pulled along causing a drag from the dead weight. When the projects or direction would come to a close, we would discuss the mistakes and/or what we would do differently.
In a lot of ways, this represents the standstill that we see in our government. With two factions constantly fighting each other, nothing really gets done. Instead, it’s a heated standstill. If one side gets their way, the other side will sabotage it. If our government were a business, it would be a massive failure. Let me restate that, when our government pokes its head into businesses, it churns out massive failures.
Now look at China. There we have a fluid government. One acting head that decides the countries direction. Is there a chance of corruption? Yes. But it’s not like we’re avoiding it here. The Chinese have the truest form of capitalism and their ecomony is flourishing for it. However, the Chinese don’t have inalienable rights. There is no freedom of press and therefore, there is no freedom to exchange ideas. This stifles their growth.\
Here’s an idea, come up with a bill of rights, elect a leader, and then do what that leader says. I know, I know, it’s crazy. In a large institution, any dramatic shift in resources could set the country back years. However, that same shift could set the country forwards as well. With the former, at least you executed on a problem and could highlight the mistakes. With the latter, you did something right and can build on that in the future. Either way, you DID SOMETHING.
In a large institution, like a nation’s government, this might not be applicable. But in a small business, it is definitely applicable. Let me lay out three imaginary businesses that are in competition. Each business makes Widget X; however, they are all structured differently:
1) Company A has one CEO who ultimately decides the fate of the company. That CEO hears out the other people on his team and makes a decision based on their input. The decision is final and the team is loyal because the CEO hired according to this structure.
2) Company B has two partners at the top that decide the fate of the company. The two partners will hear out their team’s ideas and then make a decision. The decision is final and the team is loyal to the partners because they hired accordingly.
3) Company C has three partners at the top. etc. etc.
In a bet, I would take Company A every time in terms of success. Why? Because they are the most agile. They can pivot on a dime and the decisions don’t cost them crazy amounts of time or angst. If Company A is going to make a mistake, they will make it fast and then go in the right direction. The other two Business’s have to hash it out. Too many egos at the top. They can’t be agile because each has the best idea in the way the company could go. And here’s the catch: they’re probably all correct! The problem is, they will never reach full execution because each hard decision made can leave another member dissatisfied and contemptuous.
I look to my favorite three companies 37 Signals, Wine Library TV, and Zappos. At the top sit Jason Fried, Gary V., and Tony H. These guys all have final say and guide their company in whatever direction they deem necessary. Their workers are loyal and based on their track records, they should be.
I learned this the hard way with my previous business where I had one equal partner. Standstills happened and nothing got done. If something did go in a certain direction, and wasn’t a great success, there was resentment. Now I own that business free and clear and the only hard part about making any decisions is not being able to execute them fast enough. In a way, the mental worries are free because there are no heated debates. If I’m going to learn, I’m going to learn right away and the waters aren’t muddied because a partner wasn’t motivated to execute.
Now there’s a fourth type of company. Company D has equal distribution of leadership and realizes that business is a Marriage. Sometimes, you have to give in to get going. If the company leaders are aware of their situation and attuned to the process, they will ultimately defeat Business A because they will have a larger pool of ideas to create and pivot from. So if you’re just starting, know which type of company you want to be. If you have partners, make sure they are attuned to the “Marriage” attitude. Each leader may have their different strategy to get to point B from point A.
What do you think? Will Company A rule all or does it depend more on company culture (company D)? \
You can follow me on Twitter @brianlambelet
-Brian
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-JP