Management innovation is the third critical type of innovation required for blitzscaling, alongside business model and strategy innovation. As a company races through the five stages of growth, the management approach must transform completely at each stage. What works for a family-sized team will destroy a city-sized organization, and vice versa.
The single biggest management challenge in blitzscaling is that the founderâs role must change dramatically at each stage. The skills that make someone a great startup founder are often very different from those needed to run a massive organization.
âThe founder who starts as the person doing everything must evolve into the person who builds the team, then the person who manages the managers, and eventually the person who sets the strategy and culture for an entire organization.â â Reid Hoffman
Not every founder can make these transitions. Some of the most successful blitzscaling companies have brought in professional CEOs at various stages (Googleâs Eric Schmidt, for example).
In a small team, everyone knows what everyone else is doing. Communication is fluid and informal. As the team grows, this breaks down. You need formal communication channels, regular all-hands meetings, and explicit documentation of decisions and processes.
Early-stage companies need generalists who can wear many hats. As the company scales, you need specialists who are world-class at one thing. The generalists who built the early company may feel displaced, creating cultural tension.
Individual contributors become managers, and managers become executives. Each transition requires fundamentally different skills. A great engineer is not automatically a great engineering manager, and a great manager is not automatically a great VP.
When youâre a team of ten, you donât need an HR department or a formal performance review process. When youâre a team of ten thousand, you absolutely do. The challenge is introducing formality without killing the speed and agility that enabled your growth.
âIn the early stages, you run on inspiration and gut instinct. In the later stages, you must run on data and analysis.â â Chris Yeh
Early decisions are often based on founder intuition. As the company scales, decisions must be increasingly data-driven. This requires building analytics infrastructure and a culture of measurement.
A startup can focus on one thing. A blitzscaling company must eventually pursue multiple opportunities simultaneously, or âmultithread.â This requires the organizational capability to run multiple initiatives in parallel without losing coherence.
Startups operate like pirates: fast, scrappy, and willing to break rules. Scaled companies must operate more like a navy: disciplined, coordinated, and strategic. The transition from pirate to navy is one of the most difficult cultural shifts in blitzscaling.
The founder must scale themselves as aggressively as they scale the company. This means delegating, building a strong leadership team, developing new skills, and sometimes stepping back from areas where they used to be the expert.
Culture is the most powerful management tool during blitzscaling. When processes havenât caught up with growth, culture fills the gaps. A strong culture means people make consistent decisions even without explicit instructions, because they share common values and principles.
Key cultural elements for blitzscaling: