How Can Startups Learn From Corporate Companies?

Startups are usually creative, flexible, agile and innovative, but what can they learn from traditional corporate companies?

Most startups begin the same way: someone has a spark of an idea. This person then inspires a few others to join them in making their idea come to life and build their product or service offering.

When the company consists of only a few people, it’s very easy to organise and more efficient to work without the usual constraints of hierarchy, but as the company grows this approach doesn’t work.

As people become more serious and get busier, everything becomes harder to organise and things can start slipping.

When this starts to happen, there are lots of books and theories that founders can read to help them get organised and introduce more structure as the business evolves, newcomers join the team and client expectations escalate.

But time is short and the last thing that a startup founder would want to do is copy corporate companies.

What’s next, they all wear shirts and ties?

There are lots of things startup founders can learn from larger corporations (that don’t involve wearing suits to the office) that can be easily put into practice right away without losing company culture and spirit.

Four key lessons to take from large corporations:

1. Chain of command is important

As the number of employees grows, it will become essential to define roles and have a specific chain of command to ensure organisation and effective communication.

Regardless of what type of structure a startup uses—such as a bureaucratic hierarchy or upside-down pyramid—having one is a must.

Startups will find that work is completed more efficiently when everyone’s responsibilities are carefully managed and all employees have better access to resources.

Having a hierarchy also cuts down on conflict as everyone knows their place in the company and what is expected of them.

Management increases overheads and the hierarchy will become more complicated as the company grows, which will result in further questions by employees and management. But the sooner there are answers for these questions, the easier the transformation will be.

2. Making plans is crucial

At the beginning of a startup, it’s all about working on as many things at once to get the first product over the line.

It’s all about what’s happening in the present, rather than making plans for the future.

How long have you been working on this product? Do you know how much more time you need to finish it? Do you have a marketing budget?

These are all key questions that probably aren’t considered in the initial stages of a startup. Some may not even have answers for these questions. They may not know how much money they need to finish the product. Then when they have an answer, it may just include development costs, not product launch costs, maintenance or support for example.

It’s important for startups to have a strong plan in place as they become more serious. This is important for goal attainment and moving the vision forward but it can also promote stronger internal and external buy-in.

3. Access management matters

In corporate companies, there’s normally a much higher rate of labour turnover as employees and board members come and go. They’ll usually find it easy to hire someone else to fill roles, and the person leaving won’t typically have a drastic impact on the company’s products and assets nor its ability to deliver on client expectations.

Startup life is different. It can be hard to replace people when the team is so small—especially when someone departing who has been with the company since the beginning takes all of the knowledge and know-how with them.

Savvy startups prepare to replace every single person— including board members and co-founders – from the very early stages in order to overcome this roadblock. Part of this comes back to management and structure, and ensuring that it’s clear what everyone’s defined responsibilities are, so that they can easily be passed onto someone else in the event of a resignation.

4. Using the right tools ensures success

Without the right tools, it’s impossible to get a product off the ground or to meet KPIs such as productivity targets or customer satisfaction rates.

Yes, larger corporations will have much more cash available than startups—but it’s still important for startups to prioritise getting the best equipment they can.  The creativity that is part of the startup’s DNA matters here.  If a 3D printer would be beneficial but is out of budget, teaming up with another startup to use their resource, and offering something needed by the other startup in return, is an easy solution. 

Signing up for hot desking or shared workspaces can also provide access to the right tools for less. Co-working office spaces are often hotbeds of collaboration and cooperation, but they also offer access to facilities such as presentation equipment, conference facilities and meeting rooms.