U Posted by Admin
\ January 17, 2014

Startups have the unique ability to instantly communicate across their entire organization – literally!  At Fundable, we have less than 25 team members, and we all sit in one room without any walls or barriers to communication.  When we need a change of strategic direction, I can stand up at my desk and address everyone; within a few minutes, we’re all on the same page and headed in a new direction together.

It’s impossible for a large company to do this. Large companies naturally develop layers of management with convoluted, hierarchical reporting structures that obstruct the free flow of information.

The last thing you need while launching a business is middle management and long reporting chains.  There are some startups with ten people who already have a management reporting chain that spans from the CEO to a VP to a “line worker.”  This never bodes well for startups.

Startup companies should avoid this type of bureaucracy at all costs.  Any organizational structure that obstructs communication is damaging to a company. Quick communications and an open discussion policy are key assets of small startup companies – these assets need to be maintained!

There are several ways to eliminate or reduce the amount of bureaucracy in your startup, including:
 

  • Reporting “in,” not “up.”  There’s no reason why an intern shouldn’t be able to stroll into the CEO’s office and discuss new ideas or concerns. Each instance of someone being made to report through a middle manager slows down the lines of communication and creates the risk of losing or filtering valuable input.
     
  • Get a room. Does each person in your startup need their own individual office? No! This will keep people from talking openly and regularly with other members of the organization. At Fundable, anyone in our office can see what is going on at everyone else’s desks. Many more ideas are shared when they’re able to be verbalized across a room instead of written in an email.
     
  • Take away titles. Unsurprisingly, titles give people a sense of entitlement. If people think they need a title to confer respect or authority, then they really don’t have any to begin with. Rather than granting titles to people, give them responsibilities. Unlike a title, you can’t hide behind responsibilities.
     

While not hard to do, keeping your startup open and engaged in perpetual communication takes  a thorough understanding and appreciation of good communications. This asset will allow you to outmaneuver large competitors and navigate through quick reactions and split-second decisions as a unified team.

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