Lessons from start-up thinking to help navigate organizational uncertainty
Brian Roelofs brings over 40 years of experience with 20 years in senior leadership positions with P&L responsibility in positions of Chief Commercial Officer and President & CEO. He also brings five years of consulting and board of directors’ experience. His background includes working in top tier, mid-tier, and startup companies in dry grocery, perishables, and frozen food. He has grown businesses in national and regional customers in retail, specialty, foodservice, ingredient, and export channels. He has led and been on teams that created multiple recognizable national brands. He has contributed a leadership role to three acquisition integrations, and led a private equity, scaled start-up.
Uncertainty. Pressure to innovate. Adaptability.
These are hallmarks of the startup world, but in today’s climate they’ve become a reality for all businesses. As technological, economic, and cultural shifts accelerate, even established organizations are pushed to think and adapt like startups to build organizational resiliency and longevity.
A hard lesson in start-up reality
I have spent more than 30 years in established companies leading teams and playing a strategic role in growing top and bottom lines. Recently in my career, an opportunity arose to lead the development of a true start-up company. Investors were engaged, a plant was purchased, the leadership team was recruited, and the work began. Built from the ground up, the company’s value chain map identified 285 large and small projects to put in place the necessary foundation-structure, people, processes, systems, capital, and manufacturing infrastructure. It was an extraordinary effort by everyone involved.
Throughout the journey, I was routinely asked how things were going while leading a startup endeavor. My answer consistently was, “Things are going well, we are making significant progress every day. Time will tell whether we are going fast enough.”
We of course had a comprehensive business plan with clear implementation milestones across the entire value chain, from governance to financial goals to go-to-market strategy to system integration to cultural initiatives. But in a startup, you are building everything while running the business – literally flying the plane and building it at the same time. The margin for error and pace of change is significantly different than working in a scaled stable business.
“In a start-up, the pace of change isn’t just faster – it’s constant. Just when you catch your breath, the next necessary pivot is waiting for you to solve – with no instructions,” said Gordon Robertson, ArchPoint partner and former CEO of Verdant Technologies and CRO of Apeel, two biotech companies that began as startups in the late 2010s. “No matter how prepared you think you are, you’re still stepping into new territory. It requires a lot of instinct and a willingness to educate yourself as much as possible and figure things out as you go.”
The entire team worked long hours and had to be very agile and ready for change. Funding was delayed and more expensive than planned, markets changed dramatically, customers delayed purchase decisions, and milestones were missed. Unfortunately, the business failed despite our efforts and the many accomplishments of the team. We became the one of around 30% of all venture-backed start-ups that fail.
Insights earned, lessons shared on navigating organizational uncertainty
I’ve spent a lot of time reflecting on where different choices and circumstances might have led. Now, in my role as a consultant, I’m struck by how many of the challenges we faced in the start-up world are surfacing in established businesses today. We live in profoundly unpredictable times. While many businesses are accustomed to change, the pace and volume of change many are facing goes well beyond what they’re used to. If leaders have prepared for this level of volatility, great. But it’s more likely that leaders are facing blind spots they don’t know exist, and in this environment, what you don’t know can hurt you.
“Leaders need to embrace the reality that change is the only constant,” said Richard Spoon, ArchPoint Consulting President. “Resilient organizations stay alert to shifts on the horizon, remain open to the inevitable, and aren’t afraid to seek out new information, regardless of if it causes strategic shifts – or a blow to the ego. In all my years as a consultant, I’ve never seen an OGSM that hasn’t been altered after its created due to new market opportunities or pressures, or other changes in a business. The key is to foster a culture of curiosity and readiness with our teams, so we can build organizations ready to take on tomorrow, whatever it brings.”
One would think if a leadership team were adept at decision making, agility, and dealing with ambiguity, that would be enough. Those skills, while present in many leaders, need to be heightened dramatically to meet the needs of the future at a time of upheaval or organizational uncertainty. It isn’t just about responding faster. It is about getting the house in order and shoring up the foundation so that if a storm hits, you’re ready to withstand it and not scramble to react. There are three areas that need to be assessed and addressed constantly. Below are descriptions of each area and questions leaders can use to test their readiness and resiliency for change.
- Financial resilience: Ensure that your financial position and access can weather a worst-case scenario. When unexpected shocks hit, from market shifts to rising costs to tightening capital, organizations that have planned for worst-case scenarios can adapt, respond, recover faster, and potentially save themselves from failure. Many businesses carry more debt than they can manage, leaving them vulnerable if volatility strikes. According to a CB Insights report on startup failures, 29% ran out of cash – often due to poor management of cash flow and poor reputations with investors.
- Are our physical assets and financial position in a condition that can weather worst case scenarios?
- What are the scenarios that could potentially happen in the next few months or years, knowing a few will likely happen sooner than expected? What contingency plans or financial buffers are in place to maintain operations?
- If cost inputs change suddenly, trade policy or industry subsidies, debt service costs increase, or capital becomes scarce, how will we grow or even survive?
- Are the expenses we occur prioritized in terms of revenue-driving activities?
- Milestone diligence: Be extraordinarily diligent in hitting milestones both internally and when things are going well, a missed milestone can be absorbed without much consequence. But in times of volatility, every delay, oversight, or misstep is magnified. It can stall momentum, shake investor or team confidence, or trigger unintended chain reactions. According to Accenture, 92% of capital projects fail to deliver predicted outcomes on time and on budget.
- Is our current strategy relevant to predicted future shifts in consumer and customer sentiment? Do we have the capability to shift strategy to continue to drive growth?
- Do our vendors and financial institutions have consequences for missing timelines and results?
- Does the team have the capacity to run the business as well as manage change to meet shifting needs?
- Are supporting systems able to capitalize on current technology and artificial intelligence to enable that capacity?
- Are we as efficient and effective in operations and supply chain as we need to be? If not, what needs to improve?
- Is our team communication effective and transparent so we can anticipate issues and be proactive with solutions?
- Team trust and alignment: Be hyper focused on team trust and alignment. In times of volatility, trust isn’t a soft skill – it’s a survival skill. Trust creates the foundation for resilience – it allows for tough conversations, rapid decisions, and collective accountability when the stakes are high, and certainty is low. Move with haste and foster high performance. In volatile times, time is a limited resource, and performance is your fuel. With limited runway, every team member needs to contribute at full capacity and fast, or momentum and opportunities can slip. In that same CB Insights study, 23% of startups fail because they do not have the right team or are unable or unwilling to assemble the right team. Are the right people in place in the right structure to meet the pace of change?
- Is the culture one of trust, candor, and accountability?
- Do we consider time as a critical resource and act with speed and purpose?
- Is the leadership philosophy and management process defined, and does it permeate all levels of the company to help create and manage significant change?
- Do we tolerate timeline creep and really understand interdependencies and their impact?
Conclusion
In these turbulent times, the lessons forged in the pressure cooker of start-ups offer powerful guidance for all businesses. By focusing on financial resilience, diligent milestone tracking, and fostering a culture of trust and alignment, organizations can better navigate the unpredictable landscape ahead. Embracing these principles will enhance adaptability and position your business for sustainable growth in the face of the only thing we are certain of – uncertainty.