Founders: Beware of Unchecked Optimism
James Hetfield from Metallica said it in 'No Leaf Clover': "... the soothing light at the end of your tunnel was just a freight train coming your way".
When it comes to business, every idea has optimism. Even one with a high probability of failure has a slim probability of success, i.e., there's room for hope.
Founders come from a place of growth. They have a larger-than-life mentality, and want to achieve abundantly. Dreams are, after all, unconstrained.
Executives that subscribe to this optimism are rewarded. They are "committed", "evangelists", and "team players". Those who adopt the new colors, slogan, or echo phrases used in a recent meeting are seen as engaged and trustworthy.
Ideals don't have boundaries; "anything is possible".
Plus, everyone is inspired.
But the statistics are clear. Companies that don't follow a proper due diligence and go about without a structure of checks and balances have a failure rate of 70%. Not a sound business strategy.
Good management is there to draw the line. To set boundaries. To restrain.
COOs, CMOs, and CFOs ground ideas. They set frameworks (think regulatory, legal, and tax). They estimate capacity, assess risks, and establish what sustainable growth looks like.
This creates tension with over-optimistic founders. If founders don't like to be challenged, they will feel more comfortable with those who don't raise any flags; those who "know how to play the game".
And then the worst thing happens: the yay-sayers stay and the challengers leave (or are invited to leave).
A corporate North Korea.
Culture will ensue and optimistic founders will slowly and steadily drive the company to ruin: disconnected from the day-to-day, the customer needs, and (god-forbid) regulation.
Optimism made them blind to the risks.
If founders are the kite, managers are the line.
If you find yourself having trouble setting goals and you are missing business objectives, feel free to contact us at contact@summa.consulting to learn about how we can help you.
