Leaders in large companies often lack visibility into the day-to-day workflows that drive results. They see inputs like salaries and outputs like KPIs, but the actual process of how work gets done—the institutional know-how—is a black box that walks out the door every day.
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Many late-stage investors focus heavily on data and metrics, forgetting that the quality of the leadership team remains as critical as in the seed stage. A new CEO, for example, can completely pivot a large company and reignite growth, a factor that quantitative analysis often misses.
As companies scale, the supply of obvious, valuable work dwindles. To stay busy, employees engage in "hyper-realistic work-like activities"—tasks that mimic real work (e.g., meetings to review decks for other meetings) but generate no value. It's a leader's job to create a sufficient supply of *known valuable work*.
The conventional wisdom that enterprises are blocked by a lack of clean, accessible data is wrong. The true bottleneck is people and change management. Scrappy teams can derive significant value from existing, imperfect internal and public data; the real challenge is organizational inertia and process redesign.
Leaders' primary blind spots are an over-focus on internal operations ('inside out') while ignoring market realities ('outside in'), and spending too much time on analysis while neglecting the disciplined execution of the chosen strategy. Balancing these internal/external and planning/doing tensions is critical.
Businesses invest heavily in recruiting top talent but then micromanage them, preventing them from using their full cognitive abilities. This creates a transactional environment where employees don't contribute their best ideas, leaving significant value unrealized.
A key, often overlooked, function of leaders in high-growth groups is to act as a shield against internal company interference. This allows their teams to focus on innovation and execution rather than navigating organizational friction, which is a primary driver of top talent attrition.
Leaders are often insulated from the daily operational friction their teams face. This creates an illusion that tasks are simple, leading to impatience and unrealistic demands. This dynamic drives away competent employees who understand the true complexity, creating a vicious cycle.
Traditional leadership, designed for the industrial era, uses control to maximize manual output. In today's knowledge economy, leaders must shift to providing context and problems to solve, thereby maximizing what their teams can achieve with their minds.
