LEADERSHIP
FOUNDER MODE VS . MANAGER MODE
Which is the best way to run your business ?
By Cole Jackson
In recent months there ’ s been a hot topic of debate among business leaders : running your company in “ founder mode ” versus “ manager mode .”
While the details of founder mode might be vague , we ’ ll define “ founder mode ” as staying deeply integrated in decision-making at every level of the company . A founder delegates daily tasks , and seldom empowers others to make decisions on their own .
Manager mode functions more like a traditional hierarchical model , with decision-making power dispersed throughout different levels of the organization ; the CEO handles all the top strategic decisions .
The current debate extolls founder mode as necessary to avoid information degradation and to ensure the founder ’ s vision for the company is carried out at all levels . The premise is that in a managerial hierarchy , mid-level managers are incentivized to present a rosier picture to a CEO than actually exists . With a CEO often far removed from decision-making , various functions will slowly drift off track until it ’ s too late to correct course . Critics of founder mode have a simpler term for it : micromanaging .
Our take is less existential and more focused on practicalities for business owners and CEOs . Although “ founder mode ” may make sense for tech companies where the focus of the business is continuously developing new features and products , for labor-intensive industries such as landscaping — where the focus is more on execution — it just isn ’ t realistic . Landscaping companies have crews operating over distributed geographies , with on-site immediate decisions needing to be made . It isn ’ t feasible for a founder or CEO to hold centralized decision-making power unless the company remains very small . Even for one-location equipment dealerships , operations run more smoothly in manager mode .
As a business owner or CEO , your focus should be on bigger-picture , strategic tasks : business development , customer relationship management and allocating the right resources to the right jobs . Just as important ( and part of the business development function ) is choosing the right jobs to begin with to ensure alignment with fi- nancial and strategic goals . As many business owners can attest , a higher number of jobs isn ’ t always better — other factors need to be considered , such as job costs , margins or resource allocation in relation to other business needs .
In many landscaping companies , although it is appropriate for a CEO or leader to set clear parameters for what kinds of jobs are aligned with the goals of the business , it doesn ’ t make sense for a CEO to spend time reviewing every single quote . By establishing clear parameters and empowering business-development resources to make the calls on which jobs to accept , the organization can respond to customers more quickly and the CEO is free to focus on strategic decisions such as whether or not to expand geographically or to add another service line to the business .
This is an example of using data-driven decision-making to your advantage . The most successful companies use this kind of decision-making at every level . By setting clear targets , collecting clear data and having a clear framework for using that data to make in-the-moment decisions , you remove much of the subjectivity of decision-making , and your managers can view decisions the same way you would . Collecting data from the bottom up also helps avoid the information degradation discussed earlier , as everyone is viewing the same information — even as it aggregates up to the CEO level .
It ’ s important not to implement data tracking or KPIs just for sake of measuring something . Every data point should be connected to a “ why ,” with direct lines to strategic or operational goals and initiatives . Ask yourself , “ Will this data point help me decide to either continue or change the way we are doing something ?” If not , it may not be important enough to include in your metrics .
Another area of focus for owners — and in our opinion , the most important — is hiring the right people to put in those manager or crew lead positions . This is a key tenet of manager mode : hire the right people and let them do their jobs . Proponents of founder mode claim that this hands-off approach leaves too much risk for managers to make decisions incompatible with the organization ’ s broader strategy . You can avoid this by hiring managers who understand the goals of the business and how the data being collected ties to those goals . If you can ’ t trust that your managers or crew leads are looking at data the same way you are , of course there will be hesitation to trust them to make decisions that align with your vision for the company .
One example in the landscaping industry is providing crew leaders in the field with real-time job-costing and margin target metrics . If a crew leader understands the regular and overtime hours as they are executing jobs , they are better able to make decisions in real time to change execution tactics , manage margins and ultimately deliver better service to customers .
Part of the issue with the traditional manager mode is that the “ hire the right people ” point is stressed so much , but without much direction as to how to know who the right people are . Much focus is given to interviewing tips or keywords to look for in a resume . As proponents of a longer recruitment process , we believe hiring the right people must go deeper than hard skills . You
12 OPE + December 2024 www . OPE-Plus . com