Although most companies know how to address the strategic side of growth—where, when, and how it happens—many underestimate its organizational side. Yet processes and structures suited to present challenges may well collapse under the strain of new ones.
A biotech company, for example, relied on a group of ten scientists to shape its product portfolio. Each of them worked on every project and basked in a culture of collegiality, informality, and collective decision making. But as the company grew, so did the number and diversity of its projects. The group of scientists had to grow too—eventually, to 40 members. Soon the collegial environment collapsed, scientists fought over projects and resources, and the resulting portfolio was bloated, costly, and slow.
Of course, the company had to establish clear rights and rules for decision making and to rethink the portfolio’s governance processes, such as who would attend and lead meetings. These changes involved deep-seated cultural practices and mindsets. It was therefore hard to get the large, frustrated group of scientists to accept them—much harder than it would have been if management had proposed them earlier. Avoid such problems.
Read the 2011 McKinsey article “Preparing your organization for growth.”