Kris is back on the podcast yet again and the topic for today is professional management.
We’re talking professional management when you’re doing 8-9+ figures.
Kris says that after a certain point, when your organization outgrows you at a fast-pace, you need to bring on experienced operators who know how to orchestrate many different tasks, all moving to the same direction.
The whole point is to create a structural diagram that fits your overall business strategy 1 year out.
For entrepreneurs who can create momentum out of nothing and suddenly grow to $30M – proper management suddenly becomes essential. After a certain period of time, you need professional operators who have the experience to coordinate everything and make sure things are in sync with your whole team.
Especially when you’re managing a remote team. Everything has to be done seamlessly with ideally no bottlenecks along the way.
That’s been the major topic for Kris and the Deividas team – relinquishing control to higher-level managers and make it clear who has the authority to make what decision.
Deividas says he’s used to doing things himself rather than just talking.
He’s a producer, in his own words (concept based on the Organizational Physics book). His team, meanwhile, doesn’t have any stabilizers. According to the book, there are 4 types of people that you need for any teams:
Deividas says he is a producer and an innovator, and he’s very low on unifying and stabilizing.
He’s used to getting things done in small groups of tight-knit people, doing things on his own, and wearing many hats.
In the beginning, he didn’t see the value of managers because it takes time for them to show any kind of results. After 3-4 months, it still sometimes seems that nothing is happening. As a producer, Deividas says he needs to see results.
Managers, meanwhile, are creating SOPs for product launches, work with positioning, and so on. Now, these things matter a lot, but it’s still hard to see immediate results from them.
Lesson learned: You need these experienced people. Even if they’re not producing the most right now, in the end, it’s better for the organization to have a balance.
As an example, Deividas says he can scale businesses up to $30M, using his ‘ugly method’, and after that point, he needs to hire competent people who can run the business. He says he’s not a good manager and he’s not excited about being one. So, this is where he needs to hire competent people to help him scale even further.
On that note, Kris tells the story about the author of the book (Organizational Physics) and his experience with scaling up and hiring operators.
Early on in his entrepreneurial career of going from $0-$12M, the author (Lex Sisney) had a team of startup-esque entrepreneurs with a great culture built from the ground up. After a while though, he decided to bring in operators to take their organization to the next level.
He didn’t know exactly what he was doing, but he decided to rely on the operators to manage everything. Things didn’t go as planned and he had to go backward and undo certain things as their culture had crashed and burned
The main takeaway here is that short-term oriented people should not be reporting under long-term oriented people.
You have to structure things so that the producers who are thinking about short-term revenue are not reporting under people thinking about long-term revenue.
As an example, your sales team shouldn’t be reporting under the branding manager.
Kris says that the biggest thing she’s learning is how to map out 1 year ahead. In terms of clear roles, responsibilities, KPIs, and more. Now, for every new hire, Kris is considering having new employees take PSIU assessment and a Clifton Strengths assessment.
Deividas then tells the story of a company they’re equity partners with signing an $11M contract deal for a warehouse manufacturing facility. The company wanted to innovate with their product at a fast rate and didn’t want to use any 3rd party manufacturing. So, they fired their entire production team, because the team that got them to $30M couldn’t keep up with their growth.
Lessons learned: Companies can outgrow people.
Kris says that there are very different types of brains that can find a problem and have very different ways of approaching it.
As an example, let’s say you have a team of 6 people who are competing to win a rowing race.
The producer would be thinking about how to row the fastest, the stabilizer would create a process for efficiency between all team members, the innovator would come up with new ideas, and the unifier would first make sure all the 6 team members feel good about it.
It’s a skill, says Kris. Like the classic saying goes, you jump off a cliff and build a plane on the way down.
Deividas says he’s always been hiring people he could teach what he does. But he didn’t realize his own knowledge is still limited.
What you’re looking after, instead, is insights. And now, he has new insights now after working with 3 businesses from $0-$30M and has a solid idea of where to focus on next, at what point, and how.
And that’s a wrap!
Next things to look forward to: Sugatan Black Friday strategy incoming for the next podcast (including a growth-hack that will add at least $600K to your sales), new articles, and more lessons learned growing businesses.
Share your email in the box below and we’ll update you on the Black Friday strategy and new growth-hacks we’ll be covering!
PS – Looking for more actionable advice and strategies on scaling eCommerce business past the $30M/year mark? Check out our article on growing eCommerce businesses $30M-$100M: strategies, lessons, and frameworks in which we go more in-depth about the managament frameworks and processes.
Here’s what we cover during episode #43:
- Why Kris and Deividas are discussing high-figure professional management all of a sudden
- How Deividas is managing 5 different departments
- Kris and Deividas on relinquishing control
- 4 Types of people you can find in any organization according to Organizational Physics (including Sugatan)
- Deividas’ approach to workflow, his personality type (according to the book he’s reading), and what he prioritizes when working with other people
- Lessons learned – why you need to play to your strengths and do what you’re good at, according to Deividas’ past experience of scaling businesses up to $30M using his ‘ugly method’
- Kris tells a story about the author of Organizational Physics, how he grew from $0-$12M, hired operators, and crashed and burned
- Short-term oriented people reporting under long-term oriented people, lessons learned, and creating structural diagrams with core functions
- Identifying talent, hiring process, and online strength assessment tests Kris is considering to implement
- Why Kris is so confident (and excited) she’ll have the whole team on autopilot by the end of next year and avoiding bottlenecks
- Signing an $11M deal contract for a warehouse manufacturing facility (and avoiding a 3rd party manufacturing facility)
- Lessons learned, what to do when a company is outgrowing its people and how to handle their growth rate
- The most important skill for any senior eCommerce strategist
- Why Deividas wants to grow quickly, break things, and be constantly busy improving the revenue
- If the 4 personality types from Organizational Physics were rowing a boat – here’s what each member would be doing on a practical level
- Deividas’ approach: The one thing he needs to be doing daily to accomplish his goals
- How Deividas manages his team and spends only up to 10 minutes a day on Facebook Messenger
- Black Friday growth-hack strategy guaranteed to add at least $600K in sales and other topics to look forward to on the next podcast
Links mentioned in this episode:
eCommerce Growth Saga: Scaling an eCom 0-7 Figures – Part 2 (read this here: The $1m Template)
Last 3 episodes: