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The problem with indispensable employees

Rand Fishkin, one of the better thinker/bloggers out there on startup culture in the connected age, put up a great post on indispensable employees.

For me the key section is his advice to CEOs and founders:

Startup Employers/Founders – I know we’ve all had that one engineer who’s the only one that understands the middleware code and without him/her, everything could fall apart. Guess what? That’s a business risk that you created and you need to fix. And until you build a culture where redundancy, not superstar individual efforts are rewarded, your startup will stay tiny and your growth pains will be excruciating.

The same holds true for the marketer (or growth hacker if you have a semantic preference) who controls your customer acquisition channels, the salesperson who dominates your revenue creation, or the operations person without whom, you wouldn’t even know how to issue paychecks. These are fundamental flaws in your organization just waiting to explode and cause interminable chaos. They’re part of the reason you’re working nights and weekends, and feel like the next crisis is only a heartbeat away. They’re also what separates the first-time founders from the repeat successes who built company after company that scales and exits.

Rand also points out that, perhaps counter-intuitively, becoming indispensable is a bad strategy for employees as well, because by making themselves indispensable they create the problems described above thereby reducing the chances of the company hitting paydirt. Following this logic through, only employees who are more concerned about their salary and personal position than the success of the company would makes themselves indispensable and resist efforts to build redundant processes. Let me indulge in a rhetorical flourish and ask – are these the sort of people you want in your company?

Wise words from Rand, but they take courage and good management skills to implement. There are of course a million things that fast growing companies have to worry about and building redundancy into process is one of those things that everyone agrees is a good idea, but often doesn’t get to the top of the priority list partly because there is no short term payoff and partly because it is often difficult. That can be ok (but not ideal) up to the point when the company starts to take off, say around the Series A or when the employee count grows past 20-30, but after that the longer it’s left the harder it gets to sort out.

  • http://twitter.com/arhomberg Andrew Rhomberg

    Well it comes down to whether you can create an environment of trust or not – we’ve all have had our share of “hire and fire” cultures at start-ups (or am I alone in that experience?)

  • http://www.theequitykicker.com brisbourne

    Too much firing people isn’t good, but no firing is generally a bad sign too. The key is getting
    Sent from my Android phone using TouchDown (www.nitrodesk.com)

  • http://www.theequitykicker.com brisbourne

    good balance between building a culture that is attractive to employees and a culture that only tolerates excellence
    Sent from my Android phone using TouchDown (www.nitrodesk.com)

  • http://www.facebook.com/people/Sharky-Rechinas/100003609817993 Sharky Rechinas

    I believe this is a no issue. The reason is that as soon as you can you start growing from the bottom with good juniors they will pick up/steal the know-how from the seniors.

    Unless you have a strong hierarchical culture with lots of micromanagement you should be able to disperse know how.

    On the technical side a senior guy should make things simpler and easier to understand.

    I am just saying (except accidents) that if you have redundancy issues you probably have much bigger issues at cultural level. The Founder/sometimes a cofounder are the only ones who will kill a business if leaving.
    If you hired the wrong guy redundancy is the smallest worry – you need to get rid of him for various other reasons .. (a really long list here …). And indeed – if you hired the wrong guy you should get rid of him way before he build critical skills.. I would eveen argue that the wrong guy will not build critical skills anyway because he is .. not that good :-P .

    Of course if you hire based on experience ad resumes and “an exact match” to the requirements you will hire lots of wrong resumes.. aaaa. persons.

    What am saying is that as a startup you cannot afford to hire “smart assholes who get the job done” anyway.. maybe only after VC money.. (maybe some “experts” who were recommended by VC’s in the first place ?). I know some cases. Pressure .. Rush.. etc