Change Management in Startups: What Founders Need to Know

Posted on September 12, 2018

No matter how smart and prepared the founder, no matter how well drawn out the business plan, change will happen.”

This article on change management was originally published on Berytech Fund II.

Change Management in Startups Cover Photo

Pivot, Change, Adapt. Buzzwords vary, but the concept remains the same. People who used to manage or implement that within corporations were called agents of change. Those who made it their trademark through scale and scope were called disruptors. Many claimed that title, egotistically.

But as always, often repeated mantras hide a lot of exaggeration. But also a lot of truth. Perhaps the most important human trait of all is our capacity for adaptation. Whenever we discuss anything pertaining to human history, adaptation, flexibility, problem-solving appear like recurring themes.

Adaptability is key

Business is no exception. Despite the millions of pages of previous experiences, laws, regulations, best practices, tax codes, despite MBAs, mentors, friends, and shrinks, despite all that and more, management remains to this day an essential human activity. We cannot yet – if ever – delegate it to machines and provide them with simple instructions such as: do as best practice dictates, or maximize profit. A myriad of decisions need to be taken every day, adjustments made, nudges, threats, rewards, camaraderie.

But the most fundamental role of management is to adapt to unforeseen circumstances. In highly oiled highly standardized organizations, such as banks and the like, managers are still needed every day for a judgment call here, an experience-induced wise decision there. Managers are then judged, at least in part, on their ability to adapt and react to new problems.

It is, therefore, an established fact that adaptability is a key essential part of management, even in standardized environments; what then to think of fluid, mobile environments where all the parts are moving, and all the moving parts are constantly in flux? And what might such an environment look like?

Uncertainty Will Show Up

The most challenging environments, therefore, from a stability perspective, are those of start-ups. And within start-ups, the most challenging among those are within companies operating at the bleeding edge of innovation, for there is no precedent to rely upon in that case. This is why successful entrepreneurs balance their organizations with experienced hands and reinforce their skills by seeking out consultants, mentors, and confidants.

Most household names we admire have business models that are sometimes quite far from the initial business plan. Remember Google? It wanted to become a B2B provider of services, and here it is, one of the two or three largest ad agencies in the world. Facebook? From an exclusive ivy league student redoubt to a capture all data and sell ads outfit. Airbnb? From welcoming a guest on an airbed and cooking them breakfast, to renting empty apartments. The list goes on and on.

In each case, the ability to adapt is key.

Basically, no matter how smart and prepared the founder, no matter how well drawn out the business plan, change will happen. This is the only certainty: uncertainty will show up.

In the words of Helmuth von Moltke the Elder, “No Plan Survives Contact with the Enemy”. So the need to capture fluid information, which is further complicated by the uncertainty and the lack of precision, is key. Then this imperfect information has to be analyzed and acted upon. And decisions need to be made in this uncertain environment. Then re-assessed. If it works, great, but if it does not, then things need to be revisited again. Tweaked. Optimized. Changed. Transformed. And pivoted, if all else fails.

It takes a great team to handle change

So what does it take to be able to handle that? A great team. Combining drive, intelligence, lucidity, analytics. Knowing how to listen, and when to stop listening and get down to doing things, acting.

A team that is sufficiently stubborn and driven to keep doing what needs to be done and not gives up. But also sufficiently flexible to understand when things need to change.

Not easy? Guess what: money – and success – is not lying on the sidewalk.

 


About the author

Paul-Chucrallah[1]Paul Chucrallah is the Managing Director of Berytech Fund IIHe has wide expertise in a variety of fields including finance, technology, innovation, and strategy. He prides himself on nurturing the team with valuable insights, resources and vibrant experience with innovative ventures. Holder of a degree in Telecom Engineering (ESIB) and an MBA (INSEAD), Paul believes his favorite entrepreneur style to be “the passionate iconoclast.

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