Massive growth in an organization requires a different approach than managing through stability or adversity, especially if that growth is a shock to the system.
I experienced this first hand at MGM. At the time, we were stuck in a VHS market where we sold tapes primarily to rental providers like Blockbuster. As the DVD market exploded in the late nineties, me and my colleagues at MGM were caught in a sink or swim moment where we had to pivot quickly from large sales channels to selling DVDs direct-to-consumer through hundreds of emerging retailers.
However, our ability to capitalize on this opportunity was limited by our distribution partner, Warner Bros. Although we had a good partnership up until that point, Warner Bros. was focused on volume, while we wanted to be more agile to take advantage of the emerging opportunity. So, we decided to pay Warner Bros. $225 million dollars and gave them back the rights we owned in the Turner library to terminate the partnership.
With this decision, we had traded one problem for another. As I and MGM leadership made the announcement to the organization, we started on a journey of rapid expansion and growth starting with very little. We had no distribution teams, no marketing teams, and no international offices – those were all handled by Warner Bros.
We needed to go from 0 to 100 and build it all ourselves, but do so profitably. What kept me up at night was the thought of adding massive amounts of people and the disruption it could bring to our team, our sales, and our profitability. Equally important, we had an amazing, highly engaged culture and I did not want to dilute or lose that as we expanded our horizons beyond our Culver City offices.
In a couple years, we stood up complete teams across 4 continents in the U.S., Canada, U.K., France, Germany, Australia, and Japan. In order to maintain our culture and momentum, we focused on finding and hiring leaders who reflected our values. We looked for entrepreneurial individuals who could help scale a business and who embraced feedback. We worked hard to create a cohesive executive team that was committed to improvement and growth as both individuals and an organization.
From this experience, we distilled the following steps, which were implemented to ensure maximum growth:
1) Clear Priorities
An ongoing feedback loop is critical to creating and maintaining a well-aligned organization. I utilized it obsessively. We started with clear strategic goals. I’d learned from feedback from one of our key executives that I suffered from “shiny object syndrome”. I could see many potential opportunities with our newfound freedom, but our team had to have priorities. We picked 5 and those became our main strategic goals. We then, frequently measured our performance against those initiatives.
2) Freedom to Fail
When you’re growing rapidly people can’t be confined with too many rules and sign-offs from the home office. As long as people were working on the 5 priorities, we allowed them to experiment with things that were outside the tried and true methods. Eventually, I employed a practice of celebrating failures just to underscore the point.
3) Everyone Contributes
Everyone needs a meaningful role with the appropriate authority to manage their areas. Our desire as employees is to be self-directed. When autonomy takes precedent over compliance, engagement soars. Bureaucrats need not apply.
4) Team Members Are Reliable
When you add people you trust to make meaningful decisions, you need to make sure they are not there just to put in time or pick up a check. Everyone needs to contribute. If not, remove them compassionately, but quickly.
5) A Mission That People Believe is Greater Than Themselves
What unites a team is a mission statement that drives inspiration. Daniel Pink defines purpose as “the desire to do something that has meaning and is important. Businesses that only focus on profits without valuing purpose will end up with poor customer service and unhappy employees.”
This mostly cohesive team achieved outstanding results. We grew our business by nearly 100%. Admittedly some of that was riding the wave of the DVD market growth, but this energized team dramatically raised the upward direction of that hockey stick. Over a couple of years we went from roughly $500 million in revenue to over $1 billion.
About the Author
David Bishop is a sought-after leadership development expert and speaker. David is amongst a handful of coaches that combine the practical experience of leading through all aspects of business cycles from dramatic growth to potential disruption. With his experience of delivering over 20 billion dollars from the global organization he helped build, to his deep lifelong commitment to the art and science of coaching, David will help you instill innovation and uncover maximum individual and team performance.
