Expect Chaos don’t be Chaotic in your Startup

chaotic Bert Rainbow Bert

Should you expect chaos or calm for your startup? Reid Hoffman the billionaire co-founder of LinkedIn wrote recently that to successfully grow your business, you must “expect chaos”. However, whilst you may expect chaos don’t be chaotic in your startup. How does this chaos manifest itself? Staff turning up at 3pm? Plumbing failing every day? This may be a tad extreme. Although, you may, like me have experiences of similar or exact situations like this. What he is getting at, I believe quite correctly, is that “Plan A” never works. And when the rubber hits the road, you should constantly adapt and make fast decisions, or fail. It may be rather colourful language to call it chaotic. Although at times it is. If you can be agile, and ready  to expect chaos don’t be chaotic in your startup but be ready with your strategy and team.  Adapt to the chaos to be successful and grow. Here are some ideas on what to do to avoid chaos and get organised.

Get Organised

I work with many entrepreneurs, who buzz with ideas, but some are disorganised. Thinking up a great idea is fine, but to make money, it’s about generating customers, cash and of course netting out profit. Experienced entrepreneurs recognise the milestones for getting organised. And also the key players who are needed. This is not a universal blueprint for all startups but, I’d say it reflects many company’s allocation of tasks for getting your startup organised:

  • The entrepreneur – ideas generation, decision maker, inspiration, leadership
  • Chairman – board strategy, fundraiser, shareholder, stakeholder and external relations – an interview with the McDonald’s Chairman. Difference between CEO and Chairman video.
  • CEO/MD via the business Plan – setting strategy, culture, leadership, financial oversight. Video on the role of the startup CEO. Another startup CEO video.
  • Division/Department Heads – formulate operational tactics. Building your startup team video.

This is quite and instructive video on what a board should do, if a little robotic! The role of startup boards – video.

Chaos

So, we may get organised, but what is this chaotic world Reid Hoffman is alluding to? Why did the LinkedIn billionaire describe the startup business environment as chaos? Chaos comes from the Greeks, and refers to the formless or void state preceding the creation of the universe or cosmos. I suggest these are some of the challenges a startup and indeed any business faces:

  • Unpredictability
  • Competition
  • Resource are limited

A marketer would use Porter’s Five Forces model here which highlights:

  • Potential entrants
  • Buyers
  • Substitute products
  • Supplier power

And on wider scale a PESTEL analysis of these factors:

  • Political
  • Economic
  • Social
  • Technology
  • Economic
  • Legal

The difference these days is not in the issues but how you deal with them. What you do as a team. There was probably never any point in producing a plan, who reads them? Unless you first work out what you will do with it when you have identified the issues. So, in the above cases, you first identify what’s happening on regular basis. Perhaps with a short team session. Then agree, what are the THREATS and OPPORTUNITIES and then your STRENGTHS and WEAKNESSES to deal with these. Why do this? Because when problems occur you will have a better chance to have rehearsed what to do. Many decisions will of course need to be made based finding out more information still, “as stuff happens.”

Decision Making in a Chaotic World

Working with wealthy, successful business people, from SMEs, PLCs, Government and Professional Services – in other words from all backgrounds, I see various characters but some common traits in decision-making. And decision-making strikes me as a critical factor in business. Is it just good judgement? In other words, intuitive skill gained with age? Possibly in part, but I think there is also in part a science to it. In other words, you can break-down, forensically, aspects to problem solving in doing business, the key to growing a business. And this is where decisions need to be made. Here are a few ideas for you. First, our Pinterest Page here has infographics, SlideShare and videos for you. Some other top thinkers and contributors on decisions we recommend are:
Nick Hixson – fantastic videos on decisions and heuristics i.e. rules of thumb for good decisions
Ted Talks about decision-making here including AI
More advanced –  Experts and Decision Making: First Steps Towards a Unifying Theory of Decision Making in Novices, Intermediates and Experts here

Expect the Unexpected

Henry Mintzberg strategy guru says plan for the unexpected, see his model here. Essentially have your objective in mind and just keep adjusting very regularly. If you can be agile, and ready  to expect chaos don’t be chaotic in your startup but be ready with your strategy and team.  Adapt to the chaos to be successful and grow.

Peter Eales BA Hons Chartered Marketer FCIM FIDM
Founder Director Dorset Business Angels
MD o i solutions limited

Posted in Blog.