Today’s post is from Jeff Bussgang of Flybridge Venture Capital titled Why You Should Eliminate Titles at Start-ups. Before Jeff was a VC, he was a co-founder, and before that he was an operator. He tells the story of both of these experiences – and how he learned that internal titles should be eliminated at startups.via askthevc.com
I – sort of – agree. The important word is ‘internal’.
Like it or not, titles matter very much outside the company. Especially in a startup (since, by definition, a startup’s corporate brand is unlikely to carry much – if any – weight) a title provides a signal that answers the question “should I spend any time meeting/speaking/engaging with this person?” When you’re trying to nail down that big prospect, partner or investor(!) meeting, titles absolutely DO matter – a great deal.
Inside the organization, however, I completely agree with the need to be fluid, flexible and as non-heirarchical as possible. The focus inside a startup needs to be on getting things done as effectively and efficiently as possible – and, if anything, titles get in the way of that by causing people to focus on their own status within the organization to the detriment of the focus and success of the organization.
If you needed a title for external reasons, our founder told us, we should feel free to make one up. But we would avoid using labels internally. In other words, there would be no “vice president” or “director” or other such hierarchical denominations.
Why? Because a start-up is so fluid, roles changes, responsibilities evolve, and reporting structures move around fluidly. Titles represent friction, pure and simple, and the one thing you want to reduce in a start-up is friction. By avoiding titles, you avoid early employees getting fixated on their role, who they report to, and what their scope of responsibility is – all things that rapidly change in a company’s first year or two.
So, while it can be argued that titles provide necessary structure in larger companies, they have no use whatsoever in the ‘inner workings’ of startups and are much more likely to cause problems than to solve them. If they weren’t so important in ‘signaling’ to the outside world, then yes, I’d be in favor of eliminating them completely.
Perhaps we would be better off eliminating Org Charts instead.
- Start-ups should eliminate job titles (finance.fortune.cnn.com)
- Should a Startup Have a COO? (cloudave.com)
(Cross-posted @ Chris Selland's posterous)