It seems to make perfect sense that your first hires should become managers as your company grows. Think again.
If you’ve bootstrapped your business to survivability--you’re out of the Uht-Oh-I-Don’t-Know-If-We’re-Going-to-Make-It zone--you can probably see the next big challenge just waiting for you. And this one’s no piece of cake, either.
You’re probably adding people, and you can’t have 30 direct reports, because you’d have no one to manage them. Of course you love your original team. They’re the people who got you this far, they’re reliable do-ers, and that makes them perfect to lead other do-ers. Right? So shouldn’t you promote them into management?
Maybe. Becoming a manager is a huge shift in mindset. When you make someone a manager, you’re asking someone to do the exact opposite of what they’ve been doing so well. An individual contributor becomes a manager when they stop directly performing their specialty craft and work entirely on making their direct reports successful. This must be a conscious and voluntary career decision by the individual, because it affects his or her duties, emotional fulfillment, and of course, financial compensation.
Why Two-For-One Doesn't Work
Let’s use a couple examples to see why this is such a big shift for an individual contributor with no management experience.
1. A salesperson can’t be a real manager if they have a direct sales quota. One person can’t give 100% effort both to making their own number and helping others make their numbers. There’s always going to be a conflict. Who gets the credit for the big deal that the manager helped close? Who gets priority if the manager and a salesperson have big meetings at the same time?
2. A grandmaster ninja coder can’t be a real manager and still code. If a person is up all night cranking code, they’re not helping their team think through problems. They’re not figuring out how to distribute tasks more effectively, or finding ways to interact more efficiently with product development, or putting together presentations for customers and senior management. Who is in charge of budget and compensation? How do you be a friend or peer and still be the boss?
On paper, it seems obvious that this arrangement just doesn’t work. Yet when faced with a need for managers, entrepreneurs almost always try to split the baby in half. They promote their trusted loyal workhorses into management and try to keep them as individual contributors.
This is a tough moment. I’ve been there. You want to reward these stalwarts. You really, honestly believe it’s for the best: “This is awesome. I get two key workers for the price of one, and they’ll be respected more by their teams because they’re one of them!”
To bring in a manager above them feels disloyal and inefficient. You feel like your top salesperson or coder will feel the same way. “Why should I follow someone who’s not as good at this as I am?” Yet, when confronted with this challenge, I find that founding teams deserve more credit than that. Smart people will always support a good business decision.
In my case, my business was growing fast. We went from the garage to over 200 customers in what seemed like a blink of the eye. Our technology team alone grew to more than 50 people, and of course I promoted the early super-contributors.
The guy I had at the top of the tech organization had never been a manager, but he was clearly the most efficient, hardest working, and smartest person in the organization. His top three lieutenants were the most prodigious contributors in their respective areas. Their combined senior management experience was exactly zero. They were all ragingly confident that hard work and brainpower would be enough. I believed them.
The cracks appeared slowly but bulged rapidly. We missed release dates, implementations got longer, and our support was so backed up that our customer fan club was shrinking. We were literally months from a business-ending catastrophe.
Just as we were approaching the cliff, I found a world-class grey-haired tech executive who hadn’t coded since my tech managers were in high school. Such non-existent coding chops and his other-culture origins were scary for my team. Frankly, the only reason anyone went along with his hire was that they could see we were barely hanging on by our fingernails.
The surprise for me wasn’t that Old Man CTO quickly turned us back from the cliff and made us an order of magnitude more effective, less costly, and faster. The surprise was the enthusiasm and completeness with which the managers embraced him. They loved him. He mentored all the senior managers for years until, after the sale of the company, they all became successful senior executives.
The lesson for me was that the domain expertise of individual contributors is necessary but insufficient for senior management. Your craft is where you start, but you have to want to let it go -- deep in your heart -- in order to end up as a successful manager or executive.
Now, years later, I have seen this transition to management occur many times, and always under these three scenarios:
• The contributor doesn’t want to become a manager, but tries it because the founder/CEO wants it and the contributor, great worker that he or she is, doesn’t want to disappoint. This always fails.
• The contributor wants to do it in their head but not in their heart. This is like forcing a bacon-lover to be a vegetarian. It always fails.
• The contributor wants to do it in their head and their heart. This doesn’t always work--not everyone is cut out to be a manager--but the only successful ones come from this scenario.
As the leader of your company, it’s your job to put your early contributors in positions where they can be successful, even if that means keeping them where they are. They, and the company, will be better off for it.
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Alan Ying: Alan is an owner and the non-executive chairman of KLAS Enterprises, a leading provider of healthcare information services. Most recently he was a Venture Partner at Chrysalis Ventures, a leading healthcare venture capital firm based in Louisville, Kentucky. He was formerly the founder of MercuryMD.