Change Agent - Issue 40

Is your company built to grow?I remember hiring my first, second, and third real employees. Whenever I hired someone, I was sure that person would be the last hire I'd ever make. I agonized over all three hires and spent months training them to put up with me. Since everyone I hired was going to be the very last person I would ever hire, each had to fit into the jigsaw puzzle of my company perfectly. If I needed a left-handed crochet specialist, well, that's what I hired. After all, this was it.

It became clear that I was fooling myself when I realized that there were seven people working in the attic of my house. And there were more people working in the guest bedroom. And there were even more people working in the dressing room. My wife tried to put a stop to the craziness after she discovered one too many containers of yogurt in the fridge. But the final straw was when I tried to convince her that it would be okay to have people work in our bedroom, "since they would be gone at night, and that's the only time we need it."

Once we moved to our first offices, it occurred to me that a subtle but very real change was happening to me -- something that happens to an awful lot of bootstrapping entrepreneurs. Instead of building a company that would be profitable today, tomorrow, and forever, I was building a company that would grow. Almost none of the job growth in the United States over the past two decades has come from large, established companies. Big companies don't add jobs, but small companies do -- especially new small companies.

It's not unusual to hear about a tech company that has 1,000 or more jobs to fill. Visit the Web sites of most aggressive startups, and you'll see plenty of help-wanted ads -- even from companies that are in financial trouble. "Grow or die" is the slogan of the day. But for a lot of these companies, the slogan should be something different: "Grow and die." Many of them probably shouldn't be growing so fast. Maybe they should slow down, focus, and get it right.

But let's assume for a minute that hypergrowth is really necessary for your company. Let's assume that you've got your market by the tail and that the orders are going to go either to you or to a competitor -- whoever grows faster.

So the question is, Are you built to grow? If you're basing your business's structure on the principles invented during the Industrial Revolution, it's not very likely. (But there is a lot to learn about the way that those old companies did their hiring.)

For 100 years, the key component in just about any company was the factory. The factory gated growth: It doesn't do any good to hire more workers until you've got a factory for them! And once a factory was built and staffed, the goal was to tweak it, tune it, and adjust it -- not to overhaul it radically on a regular basis.

As a result of this heritage, most companies today have no idea how to organize for ongoing growth -- especially ongoing growth of independent-thinking, white-collar types. Let's say that your goal is to add 200 people to your 400-person company this year. How should you go about doing that? Here are nine ways to think about the task.

Decentralize your hiring approach. If half of the people working for you are able to find someone better than they are to join the company, that can simultaneously solve your hiring problem and dramatically improve the quality of your workforce.

One word of caution: This approach will definitely not work if it's just another program, or if it's run by human resources (the least respected department in the company). If, on the other hand, you pay your employees a bonus equal to what you'd pay a headhunter ($30,000 a hire in some cases), and a big part of the CEO's job is to promote this program, and it's a critical part of job performance, then you may discover that the program fundamentally changes the way that you grow. After all, evangelical churches don't delegate converting heathens to the hr department -- they charge every single parishioner with going out and preaching.

Don't just fill jobs -- hire people. Advanced Micro Devices occasionally uses this approach: When executives find someone they really love, they hire first and find a job later. Some companies even offer hotshots a "gift certificate" that's good for a job anytime. (Hold on to that blue slip: Someday, you're going to want to work at Intel, and that slip will get you a job -- instantly.)

Start a William Morris mail room. Barry Diller started there. So did many of the top agents in Hollywood. It's simple: If you want to break into agenting, get a job in the mail room at William Morris Talent Agency.

The beauty of this approach is that William Morris really can't make any horrible hires. After all, most people can do a pretty good job distributing the mail, and if they can't, well, firing the new guy and starting over won't cause a whole lot of service interruption.