The Founder's Mentality: How to Overcome the Predictable Crises of Growth

Author: Chris Zook & James Allen

One of the nice things about US companies is that they engage with a lot of management consultants who end up having access to all kinds of financial information that they can mine for nuggets of wisdom. Chris Zook and James Allen are two longtime partners in Bain and Company who have taken their learnings from companies all across the globe and distilled it into this little book on “Founders Mentality”. 

Not surprisingly, most companies have a tendency to grow large and inefficient. The very thing that is designed to help them scale, ends up building massive organizational silos where doing anything that ultimately provides value to the customer becomes bureaucratic and cumbersome. In fact they report how a survey to 325 executives of large companies claimed their internal groups grew four times as often as external ones. 

They go on to state what most people in large companies know all too well. “The curse of the matrix even causes many companies to lose access to their own resources. Why? Resources in matrix organizations get trapped in departmental, silos, often defended by ballooning, sentient stuff that I’ve become the ultimate expert at the internal game. This slows down decision making and makes it impossible to concentrate resources. Big companies that have lost the founders. Mentality tend to spread resources around evenly, an understandable instinct, but one that leads inevitably to mediocrity.“

The book really delves into what it takes to have a “founders mentality” and how to apply it to large companies. The authors are very fond of the word insurgent. They goes so far as to define a term called scale insurgency, and guess what they define it as “companies that have stayed true to their insurgency for a long time…“ two sentences later, they confess  “all of the advice in this book is designed to help companies, achieve, scale, insurgency“

If you need reassurance that you are not alone in a bureaucratic large company, then this is the book for you. There are some good quotes that I noted down. Here are a couple”

• “more companies die from indigestion than starvation” — David Packard
• Create a council of franchise players – employees that have a disproportionate impact on the performance of the company.

Read this book to evaluate where your company stands in terms of operating with the insurgency of a fouder.