Chris Zook has done it again. He’s written another smart book on business growth. This time, Chris and James Allen turn their attention to the importance of maintaining the business soul that the founder instilled when the business began in order to achieve lasting success.
THE FOUNDER’S MENTALITY: How to Overcome the Predictable Crisis of Growth is a worthy summer read.
Zook and Allen’s research shows that public companies where the founder is still active in day-to-day activities outperform other companies threefold. Unfortunately, too many businesses stop succeeding as they grow bigger because they get overrun by complexity/systems and in the process, lose the “founder’s mentality.”
The remedy to maintain the founder’s mentality involves these business behaviors:
1. Following an Insurgent Mission
“A sharp insurgent mission should provide a company with its focus and purpose, both inside and out. Companies run in this way have the special ability to foster employees’ deep feelings of personal responsibility.”
2. Obsessing over the Front-Line Experience
“Most founders were their company’s first salesperson, its first product developer, or both. They lived and breathed the front-line, driven by an intellectual curiosity about every detail of the customer experience and of how everything in the business works. An obsession with the front-line is fundamental to the founder’s mentality.”
3. Maintaining the Owner’s Mindset
“Three ingredients make up the essence of the owner’s mindset and establish it as a source of competitive advantage. The first is a strong cost focus—treating both expenses and investments as though they are your own money. The second advantage is a bias to action. The third advantage is an aversion to bureaucracy—an aversion to the layers of organization, headquarters departments, and hordes of corporate staff that can accumulate, capture power, and create complex decision processes that clog the arteries of a business and slow it down.”
Of course, growing a business in this way is more complicated than just following these three behaviors. Thankfully Zook and Allen provide a detailed playbook for how to makes these ideas happen in your business even if the founder left the scene eons ago. You’ll be a smarter businessperson for reading THE FOUNDER’S MENTALITY.