For almost 20 years, I have worked for companies going through some form of hyper growth. All of these companies, bar none, have been pioneers in their field—with no blueprint to work from and no real legacy to protect. Some of them succeeded way beyond all expectations and others failed to live up to the dreams.
So what separated the winners from the losers? Their business model? Their culture, maybe? Perhaps good old luck? All of these things contributed in some way of course; but more than that, it was their ability to approach growth for the long term that made the real difference.
The companies that built themselves for the marathon, not the sprint, won the day. The idea of Intelligent Restraint and the organizational habits that underpin it provide a fantastic diagnostic tool to assess if your organization is sprinting or going the full distance.
Use restraint to grow the smart way
Intelligent restraint is a growth philosophy that says that we should push ourselves and our business to the absolute max but no further until we have built the right capabilities to support future growth. The idea is that each business needs to find the right pace for its growth that lets it perform today AND transform for tomorrow, manage energy to go the distance, and avoid harming the business and its people.
At the height of the first dot-com boom in the late 1990s, I was working in the marketing team for an online auction company that was a European rival to eBay. QXL.com was the darling of the UK Internet scene and at one point it was valued at over $2bn. Behind the scenes though, there was a lack of focus and alignment and a tendency to bite off far more than we could chew.
Products would be launched in haste and the resources needed to make them successful were moved into other new areas before sustainable growth had taken hold. Shiny new projects and PR-driven initiatives created multiple “sprints” that didn't fold into a cohesive strategy. History shows that eBay was the winner in its space; it was focused, relentless, and obsessive about its goals—and Europe became eBay’s.
Hindsight is 20/20 of course, and during the time of QXL's hyper growth, nobody put their hand up and said "Stop!" Least of all me. There was just too much pressure to grow; and for most executives, growth meant moving very, very quickly—without pause.
A few years later, I was working for a company called Overture, pioneers of the paid search model. We were acquired by Yahoo!; and the combined entity should have been set up for success in this new and fast-growing field. But similar issues ensued, this time with the added complication of a merger of two businesses. Duplication and misaligned goals prevented focus on the real growth levers. Taking the time to gauge the new entity's new maximum capacity and deploying resources accordingly, just didn't happen. Google swept in and triumphed in the paid search space.
So what practical actions can organizations take to avert disaster and promote a healthy culture of sustained growth? Working at Google for 10 years and most recently at Airbnb, I have witnessed some great examples of using Intelligent Restraint to successfully grow a company. Here's what I've learned:
Tips for leading a high-growth business
- Take bets on people and embrace diversity—avoid the tendency to pigeonhole people based on their experience. Taking calculated risks on young talent and giving them the reins early will enable you to scale the organization over the long term. Making those teams as diverse as possible will double your potential and send a signal
- Manage your own energy—carving out time to think and coming up for air is key to sustainable performance. Airbnb shuts down for two weeks over the holiday period. No emails are sent, family time is had, and everyone comes back refreshed and ready for the new year's challenges
- Audit your time—I work with somebody who deletes all of his scheduled meetings every year. All his time is returned to him from January 1. Only the important meetings will force their way back
- Celebrate failures—fast growing companies should make mistakes. Fast growing companies that sustain growth learn from those mistakes. Take time out to understand what worked and what didn't. Then build those learnings into the organisation. Post-project reviews are a good way to do this
- Scarcity brings clarity—that's a mantra from Google that can bring astonishing results. Constraints force you to be leaner and ultimately come up with a 10x better approach. Don't just throw more head count at a solution when there's a better way
Of course all of these things seem simple and like common sense, but actually doing them is another matter. It takes focus and discipline. There will be stumbles along the way. But that's ok, it's a marathon, not a sprint.
Intelligent Restraint is based on the book Pacing For Growth: Why Intelligent Restraint Drives Long-term Success by Dr. Alison Eyring.