Article
Leader Attitudes and Behaviors That Promote Effective Teamwork
August 14, 2020
Effective Teamwork: The Leader Sets The Tone
Leader Attitudes and Behaviors That Promote Effective Teamwork
Belief in the efficacy of teamwork.
First and foremost, the leader has to genuinely believe that the synergy of teamwork is powerful and real – that there’s going to be leverage gained, and better quality decisions made, as a result of getting the team to work together on problems and challenges in a unified, collaborative way. This means trusting that by putting together a powerful team of smart people with deep domain expertise and helping them work together more effectively, you can get more good decisions, stronger commitment and productive output than any individual can accomplish alone. Outstanding leaders have recognized that they need the support and input of other people, so they surround themselves with competent team members whom they work through and utilize effectively.
For tech entrepreneurs, many of whom are introverted loners accustomed to doing things on their own, this will require a huge attitude shift. They trust themselves – with good reason, as they are capable and smart – and they enjoy working on their own. But at some point as their company grows in scope and complexity, it dawns on them that they cannot possibly know everything they need to know or do everything that needs to be done, and that having a team of people to work with who have experience and expertise, in areas where they do not, can produce better results.
Choose team members carefully.
Inexperienced leaders often surround themselves with people who previously were their co-workers at a previous company, or people they knew in college, who are very bright but have little or no experience as managers and leaders. Most early stage companies don’t usually start out by bringing in a team of experienced, knowledgeable team members. If the entrepreneur has done it before, he or she might be able to raise enough capital to bring in seasoned talent, but more often the team consists of people who are doing the job for the first time and are learning on the job.
Willingness to challenge old ways of thinking and doing.
Becoming an effective leader requires not only an attitude shift, but also letting go of old habits and behaviors and embracing new ones. Your old familiar ways, as well as your beliefs about how you lead and manage, will need to change as the company grows. This includes many factors: your role, how you communicate with others, how you add value, how you make decisions, how you work through others, how you use your time, how you view systems, processes, and policies, how you set direction and plan, what is the optimal organizational culture, how much you control, and so on.
Many early stage companies develop values, norms, or take philosophical positions that later come back to bite them. Several of my clients have taken strong positions they later needed to change. One well-known company had committed to consensus decision making when they were 20 people. When they grew to 600 people, they realized that this was naïve and unworkable because they had to call huge group meetings to make too many decisions. Another committed to avoiding hierarchy and status differentials by having an almost completely flat organization, only to find that this was not workable and that some layering was necessary when the company grew.
The two co-founders of another of my clients had a very top-down management style and took a strong stance against having meetings. Needless to say, this was not workable – all decisions had to go through them, and they became a massive decision-making bottleneck.
To lead an effective team you’ve got to challenge your assumptions, and recognize that how you operated at one stage of the organization’s growth may become an impediment to what it needs from you at a subsequent stage. In the early days of the organization’s development, for example, you may have been central to the organization’s decision making and communicated with your direct reports one-on-one. This can lead to hub-and-spoke management and a decision bottleneck at a later stage.
I have worked with CEOs who secretly believed that people can’t be trusted and will not perform at their best unless they are motivated by fear and coercion. As one direct report wrote of her boss on a 360 evaluation, “It was a revelation to him that he did not have to be a tough and demanding tyrant to get people to cooperate.” Does this apply to you? Or – maybe you need to be tougher, more demanding and less laissez-faire? This is often a problem for leaders who are strong relationship builders. Chances are pretty good that whatever your natural or current leadership style is, it will require adjustment as the organization scales. Examine your habits and beliefs and look for ways that might serve you better.
Commitment to communication and open dialogue among team members
. With your team, you will make thousands of decisions. You will naturally strive to have an abundance of accurate and relevant data to base your decisions on. But research we will discuss in a future blog post has shown that as important as facts and data are, having an effective, disciplined decision-making process is even more crucial. As part of that process, ask yourself the following:
- Have you defined the problem, and the goal you are trying to accomplish?
- Have you clarified what success looks like?
- Have you established criteria for what the optimal solution to the problem would be?
- Have you collected all of the relevant data?
- Have you generated all possible solutions?
- Do you listen to each other’s viewpoints and build on each other’s ideas?
- Have you objectively evaluated the alternative courses of action?
- Can you embrace the role of a facilitator of dialogue, in pursuit of the best answer?
- Have you considered what might go wrong?
- Have you established who owns each action and set up timelines?
Delegation and empowerment.
In today’s business world, leaders may still have to make unilateral decisions at times, but more frequently than in the past, they must be willing to push decision making down, and empower subordinates to make independent decisions. If you do this skillfully, it will ultimately lead to smarter decisions and more motivated team members.
Many leaders, and particularly founders and entrepreneurs, tend to be strong-willed and driven to be in control of everything. Again, as the organization grows, it becomes impossible to be everywhere and on top of everything. If the leader is stuck in the weeds and mired in the details of things that should have been delegated to others, then things like strategic planning and facilitating teamwork and building an organizational culture are probably not receiving enough attention. It’s vital to learn to delegate and empower others.
This means going beyond delegating just tasks. You must also delegate responsibility, ownership, and decision-making authority. With your team, reach agreement on the results you expect and give your direct reports the freedom to decide how it should be done. This requires having trust in the commitment, motivation, and capability of subordinates, rather than trying to maintain tight control over every detail and dominating the decision-making process. (Otherwise known as micromanagement.)
If all decisions need to go through you and require your attention, you can become a roadblock rather than a force for progress. Effective leaders grant autonomy to those who have demonstrated good judgment and shown that they can get results. They focus on the best and highest use of their time, and gain leverage by delegating and empowering their direct reports.
Invest in building personal connections with team members.
Effective facilitators of teamwork take the time to build a personal connection with team members. Get to know your people, through one-on-ones that go beyond task updates and problem solving, and focus on team members as people, whether through informal, unstructured discussions, dinners together, or team events. Find out what they care about, what they are working on, what excites them, what frustrates them, what they are interested in doing or learning in the future, where they want to go with their career. Where do they come from? Let them know that you are there for them when they need help or assistance. Create an atmosphere in which people feel a bond of personal connection, not only with you but with each other. This has to start with you, setting the tone.
Show empathy and readiness to get involved with subordinates’ problems
. Put yourself in the other person’s shoes before you make judgments or demands. Try to understand where they are coming from – their problems and concerns, their difficulties and frustrations. Be aware that not everyone is going to be happy with some of the decisions you make. Listen to their resistance and try to understand their perspective and genuine concerns. You will not get the most out of your people unless they feel that you care about them. Loyalty is built by your behavior towards them. In our research, this was very highly correlated with being an outstanding facilitator of teamwork.
- To be a more empathetic leader:
- Show a genuine interest in the lives of the people in your organization.
- Listen with real attention and be slow to understand. Be fully present. Don’t interrupt. Listen for both content and feelings that might be under the surface. Think of ways to be supportive. Try to put yourself in their shoes. Don’t be too impatient and quick to judge. Pay more attention to the messages their body language is communicating.
Remember, your team members are human beings and they are emotional as well as rational people. If you understand the emotions that your team members are feeling, you will be a much better communicator and team builder. Take the time to develop rapport and trust, and not be focused exclusively on task accomplishment and results.
Be willing to listen, and adjust to subordinates’ needs, concerns and preferences.
This is particularly important when you meet resistance. Try to understand why they are resisting, and if their resistance represents a concern that is important for you to consider. Maybe they have an insight or see a problem that you need to know about. Don’t just go into persuading or selling mode, but, as Stephen Covey said, “Seek to understand before being understood.” And don’t just rely on position power to get them to do what you want. Listen. Learn to influence people without using your formal authority or position power. Making unreasonable demands, micromanaging and intimidating may get people to conform and perhaps get the result you want, but you won’t get their best effort, and it won’t gain buy-in for your plans and initiatives.
Balance concern for the individual with the needs of the organization.
Yes, it is important to pay attention to the needs and concerns of employees and team members. But as the leader, you also need to be cognizant of the needs of the organization. This is sometimes a very hard balancing act.
“Arjun takes deep interest in understanding the strengths of his team and fosters cooperation, communication, trust and a very supportive work environment.”
“How can I help?” - Commit to providing coaching and support.
New leaders frequently find themselves leading an executive team with too little experience and no frameworks or road maps for how to be successful in leading their team or function. Ultimately you will have to find people who have deep domain expertise, and a base of experience and insight to lead their function capably.
However, at the beginning you may not have the brand, money, or track record to attract highly experienced people. There is a real “war for talent” going on. Experienced “A” players are difficult to find and attract, and hard to retain unless given the autonomy they expect. The lack of availability of top talent often requires you to help “C” players become “B” players through coaching and mentoring, whether it is from you or outside partners. They need feedback, advice, coaching, training, and support in order to grow. But you may not always have the time to wait for them to develop. Don’t let your loyalty blind you to the fact that one of your direct reports is over their head.
No matter how carefully you build your team, the truth is that everybody you have around you will have some weaknesses. Throwing people into the deep end of the pool and watching to see if they sink or swim is not an effective management development strategy! So one of your jobs is to continually ask the question, “How can I help?” and follow that up by providing the feedback, coaching, and support that people need, as well as any management and other training classes that might help them become more successful.
There may come a time when you, too, feel the need for help. If you are new to a leadership role, it’s likely that you will sometimes feel over your head and overwhelmed. If you are wrestling with a specific problem that you can’t seem to solve, try to find someone who has faced it and solved it. Or find a competent coach to help you navigate the rapids and get you through.
Set an example of transparency and forthrightness.
One of the characteristics of high-functioning teams is openness. Team members need to feel safe and willing to share their opinions, concerns, problems, and their questions and mistakes with you as the leader, as well as with their peers. It’s important for the leader to create an atmosphere where people are helping and supporting each other, being honest and open about what they think, what their views are, and what their problems are. If the leader is intimidating, overly critical or harsh, or treats people disrespectfully, people will not open up or feel safe. If the leader doesn’t share information and create an atmosphere of openness, you can’t expect team members to do so. When it comes to openness and transparency, the leader’s behavior sets the tone.
Give credit to the team for achievements.
If the leader wants to take credit for all achievements and doesn’t recognize or acknowledge the successes of the team, team members don’t feel their efforts are appreciated and may even feel violated – that leadership has taken advantage of them. So, give individuals and the team credit for their achievements, and take responsibility upon yourself for mistakes and failures; do not blame the team.
On 360-degree evaluations, I would sometimes see remarks by subordinate raters that ran something like this: “When there is a review of his team, he tries to hide material he has received from others in order to take credit for their work.” Or, more succinctly, ‘He takes credit for others’ ideas and suggestions.” This is exactly how not to be a loved, respected, and successful leader!
share this
Related Articles
Related Articles
One of the biggest dilemmas that founders face knowing when and why to bring in a Chief Operating Officer (COO) . Too early, and you risk creating bureaucracy before the business finds its footing. Too late, and the founder becomes a bottleneck, throttling growth and burning out teams. Get the wrong type of COO, and you’ll spark culture clashes or stifle innovation. I have had 4 COOs over my career. Their styles and capabilities were very different and the role I needed them to play differed dramatically based on the stage of the company. Some of them worked out beautifully and were the perfect complement to my founder tendencies and limitations. Some were a disaster. Here is what I learned. The COO is the most variable role in the C-suite. Some founders never hire one. Others go through three or four before finding the right fit. In many cases, the question isn’t if you need a COO—it’s what type of COO your company and your leadership style demand at this stage of growth. Let’s break this down. Why COOs Matter Founders are visionaries. They are idea machines, market spotters, and force-of-nature storytellers who rally talent and investors around a dream. But those same strengths often come paired with weaknesses: disorganization, impatience, lack of systems, and difficulty letting go of control. A strong COO is the counterweight. They turn vision into execution. They stabilize culture. They keep promises made to customers and investors. And, at the right time, they free the founder to do what only the founder can do—set direction, evangelize the mission, and keep the spark alive. But “COO” isn’t one job. It’s a category. And picking the wrong type is like forcing a square peg into a round hole. The Seven Archetypes of COOs 1. The Executor The backbone of day-to-day operations. They build systems, enforce discipline, and make the trains run on time. Best fit: Visionary founders who thrive on ideas but leave chaos in their wake. Stage: Early scaling, when the business needs process without killing momentum. Examples: Sheryl Sandberg at Facebook (balancing Zuckerberg’s vision), Gwynne Shotwell at SpaceX (stabilizing Musk’s whirlwind). 2. The Change Agent The fixer. Brought in when transformation is urgent—scaling fast, restructuring, or pulling out of crisis. Best fit: Founders who know the business has outgrown their own operational grip. Stage: Scaling into hypergrowth, or turnaround scenarios. Examples: Daniel Alegre at Activision Blizzard, leading cultural and operational overhaul. 3. The Mentor/Partner The grown-up in the room. A seasoned leader who steadies a first-time or young founder, often more coach than operator. Best fit: Visionary but inexperienced founders, often in the earliest stages of institutional growth. Stage: Transition from startup scrappiness to formal organization. Examples: Eric Schmidt at Google—while not COO by title, he played this role for Page and Brin. 4. The Heir Apparent The COO as CEO-in-waiting. They take on broad P&L responsibility, often shadowing the founder before succession. Best fit: Companies preparing for leadership transition. Stage: Later scaling into maturit Examples: Tim Cook at Apple before succeeding Steve Jobs. 5. The MVP Functionalist The specialist. A COO with deep expertise in one critical area—finance, product, supply chain, or sales. Best fit: Founders strong in vision but weak in a single domain essential to scaling. Stage: Startup to early scale. Examples: Prabir Adarkar at DoorDash, covering finance and operations. 6. The Complement to the CEO’s Gaps A tailor-made role. If the founder is a disorganized visionary, the COO is structured and disciplined. If the founder is technical but introverted, the COO is outward-facing and people-savvy. Best fit: Any founder aware enough to know their own blind spots. Stage: Anywhere, but especially scaling. Examples: Sandberg balancing Zuckerberg’s lack of operational rigor; Shotwell countering Musk’s volatility. 7. The Integrator/Hybrid The most complex type. They unify strategy, execution, culture, and talent at once—bridging across multiple functions. Best fit: Complex, multi-line businesses with global teams. Stage: Scaling into maturity. Examples: Angela Ahrendts at Burberry, integrating brand, culture, and operations before moving to Apple. Why Founder–COO Relationships Fail So Often If the COO role is so valuable, why do so many founder–COO relationships crash and burn? Boards are often gun-shy about hiring COOs because they’ve seen these partnerships implode. The reasons fall into several predictable buckets. 1. Lack of Role Clarity The fastest way to sabotage the relationship is leaving the COO’s job undefined. Who owns what decisions? Where does accountability lie? If the COO’s role overlaps with the founder’s, or isn’t communicated to the rest of the team, the COO quickly becomes either a glorified project manager or a powerless deputy. Both end badly. 2. Founder’s Inability to Let Go Many founders simply can’t let go. They want to approve every detail, revisit every decision, and undermine the very autonomy they hired the COO to exercise. A COO who feels second-guessed or constantly overruled either disengages or quits. 3. Misaligned Vision and Values Operational excellence isn’t enough if the COO doesn’t fully buy into the founder’s vision and cultural values. When the COO wants to optimize for stability while the founder is pushing disruption—or vice versa—the two end up pulling the company in opposite directions. 4. Trust and Emotional Reactivity Trust is fragile. If the founder is volatile under stress, or the COO isn’t skilled at navigating the founder’s personality, the relationship becomes brittle. Outbursts, defensiveness, or miscommunications erode psychological safety between them and ripple across the organization. 5. Succession Ambiguity and Power Tensions Is the COO being groomed as the future CEO—or not? Few questions create more tension. If expectations aren’t clarified up front, the COO may feel misled and the founder may feel threatened. Meanwhile, employees begin to compare the two and pick sides. Boards have seen this movie before, and it rarely ends well. 6. Unrealistic Expectations Founders and boards often expect the COO to “fix everything yesterday.” In reality, operational improvements take time—learning systems, culture, and people. When results don’t appear overnight, frustration builds. On the flip side, some COOs expect to make sweeping changes immediately, without respecting the founder’s legacy or the team’s tolerance for disruption. 7. Culture and Communication Breakdowns The founder and COO need structured ways to align—weekly check-ins, clear communication norms, and mechanisms to resolve disagreements. Without them, minor irritations accumulate into major grievances. Worse, the team sees open conflict at the top and begins to question who’s really in charge. 8. Identity and Ego Issues Let’s name the elephant in the room: many founders see hiring a COO as an admission of weakness. They sabotage the hire by bypassing the COO or contradicting them in front of the team. On the other side, ambitious COOs often chafe at being “Number Two.” If the relationship isn’t anchored in humility and respect, egos will clash. How Founders Can Prevent the Breakdown Knowing the pitfalls is only half the battle. Preventing them takes deliberate work: Define the COO’s mandate explicitly —what they own, what’s shared, and what stays with the CEO. Set up trust rituals early —regular one-on-one check-ins to surface tension before it festers. Align on vision and values —not just what you’re building, but how you’ll build it and why it matters. Clarify succession expectations —is this person a partner, a long-term No. 2, or a potential future CEO? Say it. Set realistic timelines —agree on milestones, but don’t expect magic overnight. Communicate clearly to the org —so employees understand who does what and aren’t caught in the crossfire. Hire for complementarity —choose a COO who fills your blind spots, not one who duplicates your strengths. The founder–COO relationship is like a marriage with the pressure of Wall Street, venture capital, and 200 employees watching. When it works, it’s transformative. When it doesn’t, it’s messy, public, and expensive. The Founder × Stage × COO Fit So how do you know when and which type of COO to bring in? Here’s the decision logic: Startup + Visionary Founder Needs an Executor or Mentor/Partner. Someone to turn chaos into motion without killing energy. Startup + Operator Founder May not need a COO yet. If they do, it’s usually a domain specialist (MVP Functionalist) to cover blind spots. Scaling + Visionary Founder Needs an Integrator or a Complement to gaps. Execution and people issues become bottlenecks. Scaling + Operator Founder May need a Change Agent or Heir Apparent. The role becomes about transformation or succession. Mature Company + Visionary CEO The COO role is succession-oriented (Heir Apparent) or complex integration (Hybrid). Mature Company + Operator CEO Sometimes no COO is needed; the CEO already runs operations. In other cases, the COO is simply the next CEO waiting in line. Takeaway Hiring a COO isn’t about “offloading work.” It’s about admitting what kind of company you’re really building, and what kind of leader you are. If you’re the spark but not the engine, you need an Executor. If you’re a force of change but leave wreckage behind, you need a Relationship-Builder complement. If you’re building for the long haul, sooner or later you need an Heir Apparent. The best founders aren’t the ones who try to do it all. They’re the ones who know when to step aside—just enough—to let someone else make the company stronger. Closing Thought In Founders Keepers, I often say: what got you here won’t get you there. The founder’s job is to create possibility. The COO’s job is to turn possibility into performance. The only real mistake is waiting until your company is already fraying before you decide which kind of COO you need. By then, the cost of waiting may be higher than you can afford.
The Founder’s Dilemma Founders are fountains of ideas. You see possibilities everywhere, you connect dots others can’t, and you can sell a vision with enough energy to light up a room. But there’s a problem: ideas don’t implement themselves. They need systems, people, and execution discipline. In my coaching of more than a hundred startup founders—and backed by data from 122 founder assessments—the same challenge comes up again and again: founders are world-class at generating ideas, but their companies stumble when those ideas aren’t translated into action. I have struggled with this tendency for my entire career. My creative ideas just keep bubbling up and my execution discipline and focus can’t keep up. I have the classic “shiny object” distraction problem shared by many founders. The irony? The very traits that made me a classic visionary evangelist—creativity, independence, impatience, and risk tolerance—are the same traits that made execution difficult. If you want your ideas to live beyond a brainstorming session, you must learn to do what feels unnatural: offload execution, delegate real authority, and empower others to carry your vision forward. Why Great Ideas Die Without Execution Most failed ideas don’t die because they weren’t brilliant. They die because: 1. The founder keeps ownership too long, trying to do everything personally instead of empowering others. 2. Delegation is fake, with tasks assigned but no real authority granted, leaving the founder still in control. 3. Priorities aren’t clear, so teams are overwhelmed by too many initiatives and unsure of what matters most. 4. Accountability is weak, with no consistent follow-up or consequences when commitments slip. 5. Founders love possibilities but resist discipline, avoiding the planning, sequencing, and focus execution requires. 6. Ideas are left open-ended, because founders generate endlessly but fail to converge on closure and completion. 7. Optimism turns unrealistic, as founders overestimate what’s possible and ignore what could go wrong. 8. Expectations aren’t communicated, leaving teams uncertain about roles, outcomes, and next steps. 9. They rush ahead without buy-in, moving too fast to bring others along and win their commitment. 10. They undervalue operators, failing to leverage managers of execution who can turn vision into systems. This is what I call the founder time bomb. Early success convinces you that your personal hustle is the engine of growth. But as the company scales, hustle becomes a bottleneck. Unless you shift, your best ideas will choke on lack of oxygen. Step 1: Translate Vision Into Tangible Priorities Your job as a founder isn’t to hand down a 37-slide vision deck and hope for the best. Your team needs clarity. That means breaking down your big idea into concrete, winnable battles. Set the “critical few” : Define 3–5 top priorities for the quarter. Outcome > activity : Don’t assign tasks, define the result (e.g., “Increase retention by 5%”). Overcommunicate : If you feel like you’re repeating yourself, you’re doing it right. One founder I coached changed his company trajectory by beginning every weekly meeting with just three priorities. The noise vanished. His team finally knew what mattered. Step 2: Practice Real Delegation, Not Fake Delegation Too many founders think delegation means assigning a task and then hovering over the person doing it. That’s not delegation—that’s micromanagement with extra steps. Real delegation means: Handing over ownership, not just chores. Giving the decision rights along with the responsibility. Accepting that “80% their way” may be better than “100% your way.” Here’s a phrase worth practicing: “You own this. You don’t need my approval.” Few sentences are harder for founders to say. Few sentences build more trust. Step 3: Build a Culture of Accountability Without Becoming a Tyrant Accountability is where many founders stumble. They either avoid conflict (hoping problems fix themselves) or they overreact when deadlines slip. Both extremes poison execution. Healthy accountability requires: Clear expectations : No hidden rules or shifting targets. Visible commitments : Public goals build peer pressure to deliver. Rhythms of review : Regular check-ins that aren’t nagging but structured. Consequences : Underperformance addressed quickly, not ignored. Accountability isn’t punishment—it’s support. It says, “I expect the best from you because I believe in you.” Step 4: Share Information Like Oxygen Execution thrives on information. Yet many founders hoard knowledge—sometimes out of habit, sometimes out of insecurity. Teams can’t execute if they don’t understand the why behind the what. Empowered teams need: Transparent dashboards : Everyone sees progress metrics. Context, not just orders : Explain reasoning, not just results. Accessible strategy docs : Kill the “founder black box.” When people understand the big picture, they stop running back to you for every decision. They start acting like owners. Step 5: Invest in Second-Line Leaders Scaling execution isn’t about having 50 great individual contributors—it’s about having 5 managers who can each lead 10 people effectively. Yet many founders neglect their managers, focusing instead on product or fundraising. Strong second-line leaders can: Translate your vision into plans. Coach their teams instead of doing the work themselves. Spot and develop talent below them. Your leverage point is not how many people you personally manage, but how many leaders you multiply. Step 6: Watch Out for Founder Autopilot Your instincts—boldness, independence, impatience—got you this far. But they can sabotage you at scale. I call this founder autopilot. It looks like: Jumping back into execution “just to speed things up.” Overloading the team with new initiatives before finishing the old ones. Cutting around your managers and making unilateral calls. The cure is self-awareness. Tools like 360 feedback and coaching help you notice when you’ve slipped back into heroic founder mode instead of scalable leader mode. Step 7: Celebrate Execution, Not Just Ideas Most founders glorify the spark of ideation but forget to recognize the grind of implementation. If you only celebrate creativity, you’ll get lots of brainstorming but little delivery. Shift the culture: Spotlight the team that launched, shipped, or solved—not just the one that dreamed. Tell stories of execution at all-hands meetings. Publicly recognize “builders,” not just “visionaries.” What you celebrate becomes what your team repeats. The Founder’s Evolution: From Genius to Builder of Builders The founder who can’t offload execution ends up as the bottleneck, exhausted and surrounded by frustrated employees. The founder who masters delegation and empowerment evolves into something much more powerful: a builder of builders. In my research, the difference between founders who scaled 10x and those who flatlined wasn’t idea quality. It was execution quality. The 10x founders learned to empower others, create accountability systems, and step back from doing everything themselves. The founder who shifts from “I’ll do it” to “I’ll ensure it gets done” makes the leap from fragile startup to durable company. Closing Thoughts Ideas ignite companies, but execution sustains them. If you want your vision to shape reality, you must resist the temptation to hold the reins too tightly. Translate vision into priorities. Delegate real authority. Build accountability and transparency. Develop leaders beneath you. And above all, celebrate execution as much as you celebrate ideation. That’s how founders ensure their ideas don’t die in the brainstorm stage but live on as products, services, and companies that change the world.
Every founder eventually faces a moment of reckoning. It doesn’t arrive with a clear announcement. It creeps in gradually, often disguised as small frustrations: projects slipping, team members complaining, or investors quietly losing confidence. And at the center of it all is a painful truth: The people who carried you through the chaos of the early days, the ones who slept on office couches, pulled all-nighters, and took pay cuts to bet on your dream—can no longer keep up. The company has grown. The stakes are higher. And the job has outgrown them. This is one of the hardest truths in entrepreneurship, and one most founders struggle to face. Instead of acting, they convince themselves: “She’ll grow into the role.” “He’s been with me since day one—I can’t let him go.” “Loyalty matters more than resumes.” But here’s the hard truth that separates founders who scale from those who stall: loyalty doesn’t scale. Competence does. The Startup Version of the Peter Principle The Peter Principle tells us that in large corporations, people rise to their level of incompetence. In startups, this principle plays out in hyper-speed. What made someone a hero in a five-person company, improvisation, raw hustle, and the willingness to do anything becomes a liability in a 50- or 500-person company. Think about the hacker who was indispensable in the garage. Brilliant at rapid problem-solving, he could patch servers at 3am and crank out features in a weekend. But leading a team of 50 engineers requires a totally different skill set: planning, delegation, recruiting, building processes. His improvisation becomes chaos. His genius turns into bottlenecks. Or the co-founder who thrived on energy and vision. In the early days, charisma and instinct were enough. But scaling requires a discipline around metrics, process, and accountability. What once looked like bold leadership now looks like reckless improvisation. Even the beloved “culture carrier”—the person who organized team offsites, boosted morale, and made the company feel like family—can become a roadblock. When decisions stack up and complexity explodes, loyalty and good vibes aren’t enough. What the company needs is a strategic operator, not just a glue person. This is what I call team obsolescence : the brutal, recurring reality that many early employees get outgrown by the job. The Head vs. Heart Conflict Why do founders struggle so much with this? It’s not because they’re blind. It’s because they’re human. The tension isn’t just intellectual—it’s emotional. Guilt and Indebtedness : Early employees bet on you before anyone else did. They turned down safer jobs, endured lower salaries, and staked their careers on your vision. Cutting them loose feels like betrayal. Psychologists call this the principle of reciprocity: the human drive to repay sacrifices. Founders feel they owe these people more than just a paycheck. Fear of Losing the Magic : Founders often worry that bringing in “outsiders” will ruin the scrappy, intimate culture that made the company special. This is a classic case of in-group bias. We trust the familiar, even when it’s no longer fit for purpose. Many founders cling to the idea that culture is fragile and must be protected from “corporate types.” Conflict Avoidance : Few people relish difficult conversations. Founders, especially those wired to inspire rather than confront, often procrastinate on hard personnel decisions. This is loss aversion at work: the immediate pain of conflict feels worse than the long-term risk of stagnation. Blind Loyalty Bias : Founders frequently overestimate an early employee’s ability to “grow into” a scaled role. This is the halo effect: past loyalty and past performance cast a glow that blinds you to current shortcomings. This is the founder’s head-versus-heart struggle. Rationally, you know the company has outgrown someone. Emotionally, you can’t let go. A Founder’s Story: When Friendship Meets Reality One founder I coached built his company with a close college friend. This friend was the first engineer, working nights and weekends to bring the product alive. He coded nonstop, patched outages at all hours, and was the reason the company survived its early chaos. By Series B, the company had 80 employees. Suddenly the role wasn’t about heroic coding; it was about systems, processes, and leading dozens of engineers. The founder knew his friend was drowning. Deadlines slipped. Senior engineers were frustrated. Investors raised eyebrows. But he kept saying, “He’s been with me since the beginning. I owe him.” Eventually, he faced reality. With coaching, he had the hard conversation: “You’re invaluable to this company, but the role has outgrown your strengths. Let’s find a place where you can thrive without being set up to fail.” The friend transitioned into a specialist role where his brilliance could shine without the weight of leadership. The company brought in a seasoned VP of Engineering. Painful as it was, the decision saved both the company and the friendship. This is the essence of true leadership: honoring loyalty without letting it sink the ship. The High Price of Avoidance The costs of avoidance aren’t abstract—they’re devastating. Execution Bottlenecks : An underqualified leader slows everything down. Projects drag, opportunities slip, and customers churn. It’s like trying to scale a skyscraper on a foundation built for a cottage. A-Players Walk : The best people won’t stay if forced to work under weak leaders. They leave, taking ambition and excellence with them. The company becomes a place where mediocrity thrives. Culture Corrodes : Protecting underperformers sends a loud signal: politics matter more than performance. Over time, resentment builds. High performers check out. Trust erodes. Investor Mistrust : Boards and investors notice quickly when execution falters. They start asking tough questions—not just about your team, but about your judgment as a founder. Founder Burnout : Perhaps the greatest cost: you, the founder, pick up the slack. Instead of scaling your vision, you spend nights fixing problems others should solve. Exhaustion sets in. Your energy, the one resource no one else can replace, gets depleted. What feels like an act of loyalty today can quietly strangle the company’s future. Another Case: The Culture Carrier I once worked with a founder whose operations manager was beloved by the team. She organized payroll, ordered office supplies, and planned offsites. She was the glue. But when the company hit 150 employees, the demands shifted. The job required scalable systems, compliance expertise, and strategic HR planning. She was still running things on spreadsheets and memory. People loved her, but they were increasingly frustrated with the chaos. The founder feared that replacing her would “destroy the culture.” Eventually, he hired a Head of People. But instead of cutting her out, he redeployed her into an employee experience role. She continued to be the cultural heartbeat of the company while freeing leadership to professionalize operations. The lesson: redeployment, when done thoughtfully, preserves loyalty without sacrificing competence. What Great Founders Do Differently The best founders I’ve studied don’t avoid this problem. They approach it with discipline and compassion. 1. They Diagnose Early They don’t wait until the crisis is obvious. They ask themselves, “If I were hiring for this role today, at this stage, would I choose this person?” If the answer is no, they don’t kick the can—they act. 2. They Separate Potential from Plateau Some people can grow. With coaching, training, and mentorship, they can rise to the next level. Others plateau quickly. Great founders don’t confuse the two. They invest in growth where it’s possible and cut losses where it’s not. 3. They Redeploy with Respect This isn’t about discarding people. The best founders move loyal employees into roles where their strengths shine—special projects, advisory positions, cultural leadership. Redeployment preserves respect and institutional knowledge while freeing the company to grow. 4. They Upgrade Before Crisis They don’t wait until the engine fails. They hire seasoned executives early, before execution falters. And they communicate clearly: every stage requires different skills. Honoring the past doesn’t mean guaranteeing the future. Leadership with Compassion The real test of a founder isn’t whether you can attract capital or inspire a team. It’s whether you can make the painful calls that protect the company’s future while respecting the people who got you started. True leadership is not about cold detachment. It’s about balancing head and heart: Gratitude means honoring contributions, celebrating sacrifices, and rewarding loyalty. Governance means making clear-eyed decisions about whether someone can perform at the next level. When founders confuse the two, they put sentiment ahead of survival. But when they balance both, they create companies that endure. One founder I know addresses this directly with his team: “Every stage requires new skills. Some of us will grow into them. Others will contribute in different ways. What matters is building a company that lasts.” That’s leadership with compassion—telling the truth while honoring the past. Why This Matters More Than Ever The startup environment today is more unforgiving than ever. Capital is tighter. Investors are quicker to act. The margin for error is smaller. In this climate, founders who delay tough calls are at greater risk than ever. Execution failures and cultural corrosion are spotted instantly by boards and competitors. The founders who scale are those who balance loyalty with realism—who act before the cracks widen into chasms. The Founder’s Real Test It’s easy to celebrate early wins and bask in loyalty. The real test is whether you can honor that loyalty without being trapped by it. Because here’s the paradox: The only way to truly honor early sacrifices is to build a company that endures. And that means making the call when loyalty becomes liability. Call to Action If you’re a founder facing this dilemma, don’t wait for the board to force your hand. Don’t wait for top talent to walk or investors to lose confidence. Confront it now. Diagnose honestly. Redeploy with respect. Upgrade before crisis. Be compassionate. Be decisive. Be clear-eyed. Your team—and your company—will thank you later.
