“Startups are fast and agile.”
“Big companies are slow and afraid to change.”
In order to make good decisions, the person responsible for the decision must have all of the necessary information.
With startups, all of the information, across the entire company, resides with five, ten or fifty people.
Let’s take an example: you are the executive responsible for making a decision on whether to charge for providing phone support to customers.
What information do you need?
- What does it cost to provide phone support?
- How many phone calls do we currently receive? How long does it take to resolve each call?
- Can customers that do not want phone support continue succeeding without phone support?
- How much should we charge?
- Will this change our market position?
In a 25-person startup, this information typically relies with just a few people.
- Your 2-person support team
- Your 2-person marketing team
You can pull these people into a room together for an hour, hash it out, and get all the necessary information within an hour to make the decision.
In a 1,000 person established-company, the workflow will be much different. To get the necessary information, you’ll need to:
- Ask the VP Customer Support, who will send requests to 4 people on her team to compile the information.
- Ask the VP Product Marketing, who will ask two people on his team to compile data from customer surveys
- Ask the CFO, who will ask her team to run price-sensitivity analysis
- Ask your head of IT if our existing phone infrastructure can support the new model
At the same time, each executive will have 10-20 other concurrent requests. Their first availability for a meeting is three weeks from now.
It’s not that big companies are “afraid” to make decisions, it’s that it takes them longer to gather the necessary information.
How can larger companies gather information faster, and make decisions faster?
The biggest corporate bottleneck is relying on meetings to share information. To make decisions faster, information should be shared as soon as possible via email, apps, memos or even information office drop-ins. Meetings should only be reserved to discuss significant differences in opinion and information.
The goal is to get the necessary information into the hands of the decision maker as fast as possible, via whatever means necessary.
Another key is to only request the minimal amount of information necessary to make a decision. While it may feel like you aren’t being a team player by not including every relevant party in a decision-making process, it’s important to only involve the mission-critical parties if you want to make a fast, effective decision.