The ‘Bozo period’: is it an inevitable fact of growth?

‘The bozo what?!’ you’d be justified in asking.
A term coined by some of the earliest Engineers that worked for an ambitious start up called ‘Apple’ in Cupertino in the late 1970s, the term ‘bozo period’ referred to the arrival, en masse, of a huge number of new staff. Over 2,900 in fact. In just 2.5 years.

In one of the many insights provided by Brent Schlender and Rick Tetzeli in their book ‘Becoming Steve Jobs’, they explored the rapid scale-up period that Apple navigated in the late 1970s to the early 1980s.

A period of growth driven by the success of the Apple 2 computer. A period that, as history shows, was followed by over 10 years of poor management. Poor decisions. And major market loss to other aspirational firms, including Bill Gates’ Microsoft.

The core team of Apple Engineers, who witnessed a doubling of headcount in a mere 3-month period, and steep increases year after year, felt that the ‘newbies’ just weren’t up to scratch. They weren’t as good as them. They didn’t ‘get Apple’. That they were damaging the brand. They were suppressing innovation.

Lessons from a goliath that was so close to going the way of the Titanic.

How many scaling tech firms can relate to that challenge? When a core team of say, 5-15 individuals have worked solidly together towards a common goal. And then suddenly things take off. The company grows rapidly. Founders step aside to allow seasoned CEOs to join. Engineering teams swell from a few to dozens, hundreds or even thousands. Sales and Marketing teams appear. A split in technical vs. non-technical staff starts to occur.

If you can’t relate to it, you’ve either done a fantastic (and very rare) job of navigating that growth well. Or you’ve not got there yet.

What’s the potential impact of the ‘bozo period’ in a scaling firm?

Well, aside from impacts on culture and engagement that can sometimes be difficult to quantify, the following risks are faced:
1) A major loss in productivity (employee value-add): more distractions, poor communication, wasted time and energy.
2) Increased staff turnover and lost skill sets: differences in opinion over the direction of the business, relationship issues, poor leadership, or a lack of fairness.
3) Delays and missed deliverables: a lack of accountability, poor planning and worse execution, silo’d working.

Can you imagine joining an exciting and promising young firm, to be met with cries of ‘you’re a bozo’ from the old timers?! Whether direct challenges or subtle actions (like ignoring you in the corridor, not including you in projects, taking over tasks and not sharing knowledge), it wouldn’t exactly feel good. You might become demotivated and unproductive yourself. Or you might come out fighting and challenge the old-timers back, causing in-fighting. Neither result is good for a business.

A fact of life or an avoidable risk?

When a firm scales at pace, do we just have to accept that some disruption to culture will happen and we just need to focus on the task in hand? Well, of course, a cracked culture might be ok for a period.

Provided you’ve got unlimited pots of cash to throw at fixing problems, funding delays and replacing lost skills that is.
But it doesn’t have to be something we just accept. The reality is, EVERY business that experiences a rapid scale up risks this issue. And as the world of healthcare teaches us, prevention is always better than cure.

With so many examples of this rocky period being experienced in scaling firms, some with positive (they got through it and succeeded, though at a considerable price, just like Apple), or negative (they couldn’t recover) outcomes, there’s little excuse for ignorance these days. Investors and employees alike want businesses to be prepared for this. To navigate rapid scaling without a loss in productivity. Without compromised delivery. Without damage to culture.

As we at TEAMango say repeatedly, the journey of change is as important, if not more, than the destination. Achieving tangible goals such as growth from £1m to £10m revenue are important. But sustaining those deliverables is more important. And you can only sustain that level of performance with a well led, engaged and productive team of highly skilled people, who respect each other and work collectively as vital cogs in a big machine. And who understand the destination and take responsibility for their part in achieving the goals themselves.

You see, that period of growth at Apple, where the ‘Bozo period’ occurred, put Apple on the map. With sales peaking at around $10bn, they truly became a global goliath.

However, the lack of innovation, poor productivity and often alarming decision making culminated in losses of close to $1bn per quarter in the mid-1990s. And the loss of 6,000 jobs from a peak of 10,000. And it opened up the market for other players to dominate. And Apple fell behind.

Were it not for Steve Jobs, Tim Cook et al grabbing hold of the business in the late 1990s, who knows what could have happened … Apple could well have collapsed, and you’d have to make do with a Microsoft Windows phone instead!

What’s the key message here?

Well, it’s culture and people obviously. As Richard Branson says ‘Customers don’t come first. Employees do. If you take care of your employees, they will take care of your customers’. The same goes for product. For brand. For revenue. And for profit.
By focusing on people in times of change and growth, and ensuring the ‘newbies’ and ‘old-timers’ integrate well under a common agenda, goals will not just be achieved. They’ll be sustained.