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13.6 Growing Up and Professional Management

Growing pains are an inevitable part of life for the start-up and they begin to emerge soon after launch (see Figure 13.1 "Key Management Activities During the Business Life Cycle"). They are impossible to avoid because the world is not stagnant. The entrepreneur may not be looking for stability and consistency in the face of market dynamics and change, but the organization and the employees are looking for stability and consistency. Organizations and organizational members seek control in the form of standardized, coordinated business processes and systems; they want well-defined, enriched, and specialized jobs; and they also want salaries and benefits with the potential to grow. Small companies with astute founders can manage and perhaps even perform these tasks admirably. As the business grows, there may be a need to hire professional managers with the knowledge and skills to implement better practices.

Growing up does not mean that the founder should be ostracized or relegated to honorary duties. This may in fact put the organization at risk. The founder may have a certain entrepreneurial mojo that cannot be replaced. Steve Jobs had an almost magical power to guide Apple in the right direction. The company certainly performed better under his leadership than when he was away. Identifying professional managers is itself a project, requiring project management. Deciding on how to manage and guide the growth of the business is a key decision for survival.

Growing up also means that there are more groups that are trying to protect their own turf with somewhat unique objectives. This includes operations, managerial accounting, marketing, human resources, and product design groups. The six hats approach discussed in a previous chapter can help to reconcile conflicts during meetings, but a new organizational process for product development may be necessary in order to reconcile the inevitable differences that will occur when the functional silos begin to emerge. Concurrent engineering may be a solution for organizations as they become larger and more complex.

Concurrent engineeringThe simultaneous design and development of a product and the manufacturing process for building a product. is the simultaneous design and development of a product and the manufacturing process for building a product.Anderson (2010). An important part of concurrent engineering is the use of multifunctional teams. Concurrent engineering design teams are typically very comprehensive. They could include customers, suppliers, workers, dealers, regulators, design and manufacturing engineers, purchasing, materials managers, marketing managers, customer support, and financial and accounting representatives, among others. The objective of assembling such teams is to instill the diversity of opinion into the design and manufacturing process. Using such teams also forges trust among the parties and can also help to develop organizational knowledge that can be used to reduce development times for new products.