Why I gave up my private office

A few months ago, after more than 5 years, I moved out of my private office and into open space seating. It’s been the best management decision I have made in a while.

I always thought I had good reasons to occupy a private office, mostly because of my people management responsibilities.

Privacy. Managing people requires privacy for planned or ad-hoc 1-on-1 conversations. Spending enough time with team members on a 1-on-1 basis to listen to concerns, address issues and provide honest feedback is an important part of my job.

Confidentiality. I quite frequently need to discuss face-to-face or on the phone confidential issues related to HR, financials, sales, strategy, company decisions, etc. Confidential information is also shared through e-mails, so I sometimes need to keep my screen to myself.

Individual Productivity. Managing people means frequent interruptions. When critical work needs to get done, it makes a world of difference to be able to close the door and work undisturbed.

Over time, though, I realized that the above reasons were not enough to justify secluding myself in a private office. In fact it became rather clear that there was so much I was missing out on. Let me explain.

My primary responsibility as a manager is to make every single one of my people successful. There is no such thing as a good manager of a poorly performing team.

Seating in open space next to my team members allows me to have a much better understanding of how to help them be successful in all sorts of ways.

Chemistry. The right chemistry within a team and across teams is what makes teams and organizations successful. You can learn a lot about where chemistry is lacking by watching how teams interact in meetings or by consistently gathering feedback from team members, but there is nothing like witnessing first hand how people and teams interact on a daily basis under all circumstances. It is an eye-opener and something that a manager hiding in an office can never fully understand (or fix).

Foresight. A hallmark of a good manager is his/her ability to identify and resolve issues before they turn into real problems. Seating in open space next to everyone else has helped me get a much better sense about where friction may be brewing. You just feel it in the air, way before someone knocks on your door and lets you know about it.

Team productivity. I expect my team members to be super productive. Unfortunately, they don’t have the luxury of closing their door to work undisturbed when they need to. So I must make sure that they are operating within a productive working environment, with as few disturbances as possible. The only true way of ensuring that is by feeling the pain myself while trying to be productive in the same working environment as them.

But it’s not just about making my team successful. There is another very important reason.

Moving into open space next to the team sends a powerful message: we are in this together. The team realizes that you actually mean it when you say that you are in the trenches with them and that you are always there when they need you. It’s not the same if they have to knock on your door or call you. It just builds a different level of trust.

As far as dealing with issues of privacy, confidentiality and individual productivity, the answer is quite straightforward. Turn all private offices into meeting rooms. That usually provides plenty of space to cover everyone’s (not just the manager’s) needs for the above.

Of course, there are objections.

The most common one I hear is that people will feel like they are being watched over and that they will purposely alter their behavior just because their manager is sitting there. This may sound like a valid concern, but it mostly applies if you are managing by fear, rather than trust and results.

Another big one is that a manager deals with so many private and confidential issues that it is impractical to have to use a meeting room all the time. My answer to this is that unless you are the CEO or you are in finance or HR (and even then, I am still skeptical), you should not have that many secrets from your team. If you do, something is wrong.

Last but not least is that managers have just earned the right to have a private office. Corporate mythology is awash with images of powerful executives occupying plush corner offices, with large glass desks, expensive furniture and awesome views. The effect is so strong that the size, luxuriousness and location of a private office often become measures of success for managers.

The reality, though, is that a private office is nothing more than a power trip and that moving out of it is the best thing a manager can do.

Interview for what you can’t change, not relevant experience

Interviewing is tough. You have about one hour to make a decision that has a significant impact on an organization. The stakes are high. A bad hire costs a lot of time, money, effort and morale. The smaller the company, the bigger the impact.

Of course, interviewing is only a part of the hiring process, which should also include things like testing and reference checking, but it’s definitely the most important one.

Yet interviewing is probably the most under-developed skill within most companies, especially startups. Hiring managers and interviewers rarely go through formal or even informal training on how to conduct an interview. In fact hiring teams rarely talk about what they are looking for in a candidate and how to figure it out from an interview. On top of all that, most people just don’t like conducting interviews.

I have had the chance to conduct hundreds of interviews for all kinds of positions in the last 5 years (I actually like it). This exposure has enabled me to develop a system for evaluating interviewees, which I would like to share. Every hiring failure (and I have had several) has served as an opportunity to re-evaluate it and refine it.

Here is how it works.

The first and most important thing I look for is brains. The smarter, the better. Being smart doesn’t solve all problems, but not being smart is a blocker. Intelligence cannot be taught or developed over time. So it’s a deal breaker for any hire. Of course, measuring one’s intelligence or even defining intelligence is a matter of heated scientific debate. Undeniably, though, figuring out whether an interviewee is smart is much like what United States Supreme Court Justice Potter Stewart famously wrote about pornography “I know it when I see it”.

I subsequently look for qualities that I can’t train for and are universally applicable regardless of job description. Such qualities are usually ingrained personality characteristics that cannot be developed over time, at least without an enormous amount of effort. They are part of someone’s personality that has been shaped by genes, environment and experiences. Examples include honesty, integrity, commitment, ambition, work ethic, manners, positive attitude and love for what they do.

Equally important is to look for such qualities that are blockers for any position. A person with attitude, arrogance, lack of ethics or passive-aggressive behavior is poisonous for any organization, no matter how smart he/she is.

Next on the agenda are qualities and skills that are critical for the specific job description and are also very difficult to train for. A web designer better be creative. A QA person must love attention to detail. A project manager cannot be communication averse. Of course, these qualities don’t apply to every position. It’s probably ok if a sales person doesn’t pay enormous attention to detail or if a software developer is communication averse. As such, I evaluate them not only against the current job description, but also against one’s potential growth path within an organization.

Last and in many ways least come the qualities and skills that are relevant to the specific position and are mostly related to a candidate’s past training and experience. This is stuff that can be taught or developed over time, but a certain minimum level may be required depending on the position. The goal is to determine how ready someone is or how much development time is required to get there.

This is rarely a blocker. An interviewee who scores high on all previous categories, but is a bit junior for the position, will most likely turn out to be a very good hire. It will just take a bit more time and effort.

On a final note, an interview is also about chemistry. If there is none, it’s a problem, even if everything else looks great. There has to be something there that says “I want to work with this person”. That’s because you will have to do it, every single day.

Startups are run by founders, mature companies by management teams.

Early in a startup’s life the founders are everywhere. They build the business model, they design every feature of the product, they pitch to every sales prospect, they create all the sales and marketing materials, they raise money, they run every customer implementation, they interview and hire every new person, they review every invoice. They set the pace for everything and control every detail.

That’s how it should be.

Turning a good idea into a revenue-generating product is a long windy road with many dangerous turns along the way. Everything is constantly in flux. The vision, the product and the business model are invariably changing to accommodate the realities of paying customers. Every step of the way requires swift decision-making inline with the company vision.

This is undeniably the founders’ job. It cannot be delegated. This is the time when the DNA of the company is defined and it is done every day, one detail at a time. The founders need to be there every single time.

Eventually, though, this model reaches its limits.

At some point a startup proves its business model and needs to grow very rapidly, without spinning out of control, in order to capitalize on the opportunity that lies ahead. It needs to turn into a company that can build, sell, deliver and support in repeatable and scalable ways, while staying innovative and hungry. It also needs to keep its finances under control at all times, while spending loads of cash to fund the growth.

This is the time when a startup can no longer be run just by the founders and needs a management team. To put it bluntly:

Startups are run by founders. Mature companies are run by management teams.

The transition from one to the other needs to take place at the right time and in the right way. Easier said than done. There are 3 main reasons why it is really hard.

1. People

The right people are needed to staff the management team.

Ideally, existing employees should step up to the challenge. They are a known quantity. They have been there from the start, they have embraced the company vision and culture, they know the business model and the product and they have earned the trust of the founders. Unfortunately, though, promoting existing employees is not as obvious of a choice as it sounds.

In a small startup team no one is a more experienced manager than the founders. In addition, existing employees often cannot make the leap from “one of the guys” to managers who can convincingly exercise authority upwards and downwards.

On the other hand, bringing in outsiders at a senior level and at such a critical transformation stage for the company carries significant risk. They may possess the right experience and managerial skills on paper, but they remain a completely unknown quantity.

In addition, the odds are against them. They are up against extremely high, if not unrealistic, expectations set by the mere fact that they are hired as “saviors”. They have to establish their authority even before they have the chance to learn in depth what the company does. They need to gain the trust of those above and below them, which is definitely not easy to do in tightly knit startup teams. They need to embrace, but at the same time change some aspects of the startup culture. Naturally, even very good people fail at this.

Ultimately, a senior management hire that doesn’t work out is a 6 to 12 month setback, a very long time for a startup trying to grow in leaps and bounds.

2. Structure

The newly established management team will be called to manage an organizational structure that is far from being the right one.

Early startup teams don’t really worry about responsibilities and accountabilities, they just do whatever it takes to get the job done. When the time comes to establish a proper company structure with clear delineation of roles and responsibilities, no one really knows what scheme will work best and will enable the company to scale. The first version of the organizational (and management) structure is really an experiment. Several iterations, i.e. major re-organizations and re-shuffling of the management team, are often required to reach a stable, well-performing and well-managed organization (we went through at least 3 major iterations at Upstream within a year and a half before we got it right).

This is a really painful trial-and-error process that requires unmitigated self-awareness and brutally decisive action every step of the way. It also invariably hurts a lot of feelings.

3. Authority

The founders and the management team must grapple with the elusive task of aligning responsibility with authority.

On the one hand, managers needs to have the right level of authority to carry out their responsibilities, make the decisions they see fit and live or die by the outcome of these decisions. On the other hand, the founders cannot just hand over the keys to someone else and risk losing control of the company.

Finding the right balance is a big challenge. Too much authority means that parts of the company may become black boxes and spin out of control. Too little authority means that the chances of the management team succeeding are undermined.

Finding the right balance requires conscious effort and significant adjustments by all involved.

The managers need to build a case for themselves and earn over time the right to exercise authority, based on actual results not job descriptions. They also need to know when to ask for permission and when to ask for forgiveness.

The founders need to avoid micromanaging. They need to let others try and often fail, resisting their natural instinct to step in (up to the point that they need to step in to avoid disaster). At the same time, they must develop a management style that ensures that no part of the company becomes a total black box for them, that the right mechanisms are in place for them to make those decisions that shouldn’t be made without them and that early warning signs of danger can be easily spotted.

Ultimately, establishing a successful management team is a trial-and-error process but with very low tolerance for errors, because they cost a lot more than they would in a stable mature company. With every setback, founders tend to lose their resolve in making it work. Instead they step in, take full control of the situation and take swift remedial action. It subsequently takes a long time to restore faith and trust in the system and the people. But the end goal justifies trying again and again until it just works.

From startup to maturity

There is a stage of startup life that is rarely in the spotlight: growing up to be a real company.

It is the stage when a startup needs to go from having the potential for exponential growth, namely a great product, a solid business model and some enthusiastic first customers successes, to realizing that potential.

It is the stage when a startup needs to stop acting like a brilliant yet erratic child and start behaving like a well-oiled execution machine.

And quite often it is where a lot of startups fail.

That’s hardly surprising given the challenges of scaling a successful global business, not the least because the qualities that propelled the company through the treacherous waters of early startup life are quite often not the ones that can take it to the next level. The creative chaos must give way to organized growth. The miracles of getting the first customers on board need to start happening a lot more frequently. The heroics to deliver the first customer successes must be replaced with repeatable processes. The infinite flexibility in making a product meet the needs of those early adopters must become a properly managed product roadmap that delivers revenue and innovation at the same time. The jack-of-all trades mentality (if not necessity) of the founders and early missionaries must transform into a well-structured and well-managed global team of passionate employees.

All that must take place while the train is running at full speed and without missing a beat, since setbacks at larger scales can be lethal.

If it sounds hard, that’s because it is hard. I know first hand. It’s been a good part of my 5+ years at Upstream, where I had the good fortune and privilege of contributing to such a transformation.

When I joined in September of 2007, the company had about 40 employees and a single office in Athens. By the end of 2011,  it had transformed into a mature company and a global industry leader with 160 employees, over $100 million in revenue, 8 offices around the world and customers in more than 40 countries.

Did  the company qualify as a startup ready to grow-up in September of 2007? After all, it had been around since 2001 and 40 employees is not what a startup normally looks like.

The answer is yes. By September of 2007, the company was gearing up for unprecedented growth. It had turned a very promising idea into a first version of a completely new product, which had been successfully tried in the market a few times. The day I joined, after a truly heroic summer that left several people burned-out for months, the company launched its biggest project yet with the most important international client it ever had. It was a giant gamble and a spectacular success. The success proved unequivocally the solidity of the new business model. It also gave the company the ammunition needed (in terms of cash and customer references) to fuel its very aggressive business plan for global expansion. The “growing-up stage was about to begin.

Within a little more than a year, I found myself running the technology and operations department, accounting for about half of the people at the company. My job, along with the rest of the management team, was to build an organization that could keep up with the explosive growth the company was experiencing. This meant guiding the technical teams in scaling our homegrown software platform as well the infrastructure needed to support our global expansion. It also meant dramatically scaling our operations to efficiently execute and support on a 24x7x365 basis the ever growing number of projects around the globe.

It was a truly wild ride. Along the way, I learned a lot about what it takes to grow a company into a global industry leader. I experienced the ups and downs, the rough times and the good times, the tough decisions and the celebrations of a company working flat out to succeed globally.

It’s some of these experiences and learnings that I have decided to share in a series of upcoming posts.

Now, more than ever, perhaps for the first time, there will be a number of promising startups in Greece that will get the chance to reach the growing-up stage and will have to deal with a part of the startup journey that few have told them about.

So I think that this is the right time to open up the conversation about how to deal with that. I believe that public discourse over the matter will help them be better prepared when the time comes.

An additional motivation is that Greek startups will most likely have a harder time staffing for this growing-up stage due to market structure and limited past success stories. As such, it’s a bigger issue that requires a lot more attention than in the US for example where there are armies of trained managers who can bring just the right type of skills to the mix.

The posts are by no means intended to be in the form of advice. After all, as the saying goes, “the best advice is this: don’t take advice and don’t give advice”. My intention is to share experiences and learnings that I picked up from the real world training that I got in this arena, in the hopes that other people will find them useful and that they will contribute to the public discourse.

As a final note, I should make a couple of important notes about the posts to come:

  • I will shy away from discussing commercial and marketing strategies since those are quite unique to each company, business model, product and industry. There are also other people who can do this better than me.
  • I will use examples wherever I can, while keeping within reasonable confidentiality bounds.

All in all, I can honestly say that the journey from startup to maturity as I have experienced it has been superbly challenging, but at the same time unbelievably exhilarating and rewarding. I hope my posts will tell a small part of that story.