Why Startup Thinking Can Benefit Large Enterprises
Startup businesses are exciting places to work. They’re known for speed-to-market, lack of bureaucracy, and success on a shoestring. Of course, beyond the romance, there’s also the reality: many startups have reputations for burning people out or blowing up altogether.
But what can today’s established companies learn from the successes of startups?
In my role at Northwestern Mutual, I’ve weighed this question carefully. Having spent several years at startups, I felt I had a good handle on what it took to be successful in a fast-paced, entrepreneurial world. When my career shifted to Northwestern Mutual, I knew I would also have to shift my mindset to enterprise thinking. I was excited to find that so much of what I had learned (and loved) over the years at startups not only applied – but in fact could benefit – more established companies like Northwestern Mutual.
So if I had to boil it down, here are five secrets from my startup successes that I think all business owners should understand:
Start with talent FIRST
At big institutions, talent processes can lead to a systematic backfilling of past positions instead of creating the future. At startups, you’ll often see a much more proactive search for top talent.
Shifting to a star-search model is a big departure for a lot of enterprise companies and especially hiring managers. To discover top talent, though, you have to be proactive in every single way. It’s the responsibility of every leader.
In my experience at successful startups, more than half of managers’ time was spent looking for talent. You can’t “hope” your way to having a rock star team, and you cannot outsource it either. You have to build the pipeline and always be in a hiring mindset. It’s important to work in partnership with human resources and take an active role. YOU have to build your successful team.
Focus on ruthless prioritization
At most startups, to land your financing or to create your MVP (minimum viable product), you have to know how to quickly pivot and practice the skill of “ruthless prioritization” – the ultimate in start/stop/continue mindset. Because the question you’ll always get at a startup is, “What have you shipped for me lately?”
Many large organizations can benefit from mastering the art of saying yes to the right things and no (or “not now”) to the rest. It’s critical for leaders to create a culture that rewards ruthless prioritization and sheds the less strategic tasks.
High-performing culture must permeate everything
Audit your environment. Is it a place where teams have the tools to deliver and accountabilities are clear?
Once your employees have what they need, reward and recognize your high performers who consistently deliver outstanding outcomes, not those who get bogged down by bureaucracy, self-promotion and consensus.
All along, emphasize and ensure that your KPIs are focused on the right outcomes, not on “gaming” the numbers or just checking boxes.
Have an engineering approach to everything
Whether you’re at a scrappy startup or a legacy company, engineering should always be much more than just creating and delivering solutions. A true engineering mindset means having a passion for problem solving elegant solutions within given constraints. It’s taking an approach that pushes beyond just understanding your surroundings - to anticipate and recognize needs, define problems, collect data, and form and stress-test solutions.
Applying a sound engineering approach to organizational issues is extremely effective, and one that most startups master.
Develop radical transparency
It can be difficult to have “straight talk” if your company culture is one that favors courtesy over clarity. All business leaders should strive to develop a language and culture that embraces constructive criticism – in other words, walk the walk. Be transparent and avoid politics that big enterprises can get mired in.
Best of both worlds
Startups don’t have all the answers. In fact, many lack longevity because of their disregard for compliance, enduring processes, ability to create at mass scale, and more. But if you can integrate these five secrets of startups in your large organization, in my opinion, you can have the best of both worlds.
That’s what we’re doing at Northwestern Mutual – we’re pivoting in each of these areas to act more nimbly, to attract and keep exceptional talent, to cultivate honest conversations and more. In doing so, I know that we’re innovating and creating the future of financial security.
What else have you seen in a startup that today’s big companies should co-opt? Let me know.