M&S Newsletter Spring 2021 Simple

The other day, I was asking a friend how work was going. He’d recently moved from a small business to a large global corporation with thousands of employees spread out across the world. He certainly knew things would be different, but he didn’t realize how different and overly complex it would be.

His comments were mainly about something many of us have experienced – time wasted in unnecessary meetings. There’s a strong possibility you’ve found yourself at the end of a long meeting asking yourself – “Why did we need to have this meeting?” My friend described his new employer as having a very “corporate culture”.

When someone describes a company as having a “corporate culture”, it’s typically used in a derogatory manner. In addition to wasting time not doing work, other undesirable stereotypes of working in a corporate environment can be layers of inefficient middle management, unnecessary complicated expense approvals, and complicated and complex processes, procedures, and red tape.

Being a part of a large organization is not bad. Many of our clients are very large organizations that are fantastic places to work and to work with. The issue isn’t whether a small or large organization is better. Actually, we have every intention of getting much bigger ourselves. The issue is how can both small and large companies keep their culture from becoming too complex where it becomes difficult to get work done. 

A more complex corporate culture can be found in any size organization. Your culture is nothing more than “how you do things”. For a multitude of reasons there is a constant tug as you experience growth in numbers of people, to add layers of processes, procedures, management, and overhead. In general, the larger you get the slower you grow, the less profitable you become, and the more corporate your culture feels.

As a company, we have been blessed to consistently grow over the last 22 years. We’re up to approximately 220 employees which is incredible. We felt a definite shift in how we had to run the business around the 100-employee mark. At that point, some government regulation kicks in and you fall into categories where more reporting and administrative positions are required to help “professionalize” areas that need expertise. Some of this is good and necessary but the temptation can be to go too far.

So, if growth comes with this magnetic pull towards a complex corporate culture and what most of us experience as a negative, why would you grow? Well, the main reason you should grow is to give people opportunities to grow professionally. If you do not give people that room for growth, they will most likely leave. Additionally, it will be difficult to recruit new team members to join you if they can’t envision how they can grow professionally, both in responsibility and financially while at your organization. Lastly, we want to grow so we can provide our services to, and build relationships with, more clients.

Thankfully, a strong part of our culture is the relentless pursuit of keeping things simple. Since founding the company, Brian has managed decision making by using common sense and moving in the direction that provides the least complex solution, and operating in a relatively flat, non-hierarchical structure. We have an “operate small, act big” mentality. It’s a part of our DNA as a company. Our goal is to continue to grow our employee base and client relationships but operate with that small company feel internally to attract and retain the best talent possible. In doing so, our clients will benefit in getting to work with smart, happy employees who help them solve their problems.

From our observation, many of the “corporate” ways of doing things are put in place out of fear. Fear of the unknown. Fear of losing control. Fear of putting the whole company at risk. It manifests by adding a reporting function here, by requiring this approval there, and by adding in this extra step (or twelve) so someone can track it and hit a number. Unfortunately, common sense can get diluted as you add in all this complexity.  

We don’t think it has to be that way.

Since it’s so important to us to keep things simple around here, we wanted to share with you how we try to do it in practice:

Leadership and Management Philosophy

1. As a company we’ve adopted the principles outlined in the book Extreme Ownership. In the book, Jocko Willink and Leif Babin point out that all employees are leaders in some capacity. Therefore, if you’re a leader (and you are) then it’s your responsibility to own the problems, and the solutions to those problems, you face. So, whatever situation or problem you encounter – you are there to help solve the problem. To us, that makes a lot of sense and it simplifies problem solving. When you own the problem, there is no one to blame. Instead of finding blame or complaining about something, you ask yourself what can I do to help solve this problem and you take the next step required.

2. We try to hire the right people, give them the tools they need, and get out of the way. Empowering people to do their work, lead their teams, and solve their problems gives them an incredible sense of accomplishment and fulfillment.

3. We have a lean management structure. We do not have layers of middle managers or unnecessary administrative departments bogging us down with overhead expenses. We try to keep the path to approvals and decision making very clear and efficient. To do this, you have to hire well and then trust people to make the right decision. Simple, not easy.

Financially

1. As you grow, accounting and financial management can get overly sophisticated and complex – if you let it. Software provides you with an unbelievable ability to forecast and manage the business which can be a blessing and a curse. The magnitude of reports and financial analysis can be tempting and take you down a rabbit hole of analysis paralysis. We use our project and accounting software as a tool to do the necessary tasks and reporting that allows us to be accurate and fiscally sound. We don’t use it to try and figure out how to squeeze every last cent of profit out of a project or how to improve a financial metric by fractions of a percent.

2. Some companies will run on low levels of cash and uncomfortable levels of debt to maximize specific financial ratios. We don’t do that. Why? As you over-complicate your financial management and implement complex reporting requirements; you force your entire company into laborious and costly processes so you can see reports that make you feel better about the added risk you’ve taken on. No thank you. How do we manage our finances? Simple – 1. We spend less than we make. 2. We save for unexpected and future expenses. 3. We try to pay our people well. 4. We pay our vendors on time. 5. We make decisions that allow us to sleep well at night. Yes, we certainly track certain metrics but it’s a handful of the most important ones. If those are good, then everything else takes care of itself.

Operationally

1. We try hard not to have meetings that have no purpose behind them. We don’t have a bunch of regularly scheduled meetings that pop up every week that you dread. If we need to meet, we meet. If we don’t, we don’t.

2. We try to give people the autonomy to make common sense decisions based on their knowledge of a situation. We don’t manage by committees and we minimize layers of approvals to go through. Adding complexity slows down workflow and frustrates people. We encourage our people to make a call and move forward. We put an emphasis on not overthinking things.

In the end, we believe that our culture of keeping things simple and using common sense when solving problems spills over into the way we help our clients. We don’t try to overcomplicate the solution to sound smart (this isn’t hard for us) or to charge higher fees. We try to take a very common-sense approach to each project and if there is a simple direction – we take it. Our philosophy should allow us to stay agile and nimble, even as we grow; so we can provide the level of responsiveness and service expected from our clients.