The illusion of head count

Whether it’s a startup or a huge organization, head count is always perceived to be a metric of growth. And this metric is highly overrated, at least in our part of the world. In fact, in some cases, it’s considered to be the only way to identify the growth of a company. If that was not all, we’ve also got the hiring companies that make sure the term head count gets more importance than it deserves. Well, it’s purely because their revenues are directly proportional to the number of people they place. Unfortunately, sometimes we get caught in this whole process of trying to up our game by having a disproportionate head count.

When we first launched our company, we had just one employee on-board. That’s all we could afford back then. Most self-funding startup leaders would relate to this beginning. But soon we added more people to the team. This was however, a strategic and a calculated move. We were in no rush. As we kept getting more business, we got more people on-board. This had become more of an automated cycle. But there were examples of our peers that just kept increasing their team strength, with very little or no planning. Today, most of them are completely off the radar.

Sometimes, we get caught in the whole number game with the rising expectations of employees, clients and vendors et al. These are not unrealistic expectations though. Everyone wants to be associated with a “big” company. Unfortunately, the definition of a “big” company, for most, is directly proportional to the head count. However, contrary to popular belief, smaller teams with the right mix of experience, enthusiasm, vision and hard work can be more effective than their bulky counterparts. Whatsapp, for instance, had a very small team through most part of their initial years. In fact, at the time it was bought by Facebook, for a whopping $19B, it still had a total of 55 employees only. Then there’s the famous core team of Apple that was headed by Steve Jobs. It was a small team that made history with the Macintosh. There are many such examples that we see around us as well. But the idea of gauging the strength of a company through its headcount continues to haunt us.

That’s about some really big and famous companies. But the reality of a bootstrapped startup is way different from the glossy stories we hear. Isn’t it? Well, true. Perhaps, creating history is not even on your list of priorities right now. Your immediate concern is whether you should hire another individual to join your team or not? Will he be able to take care of as much business that he doesn’t become a financial and obligatory burden? But every time you focus on what kind of impression the outer world will have about your company’s strength. And get carried away to make your next hiring move, think about these reasons that reiterate the unmatched advantage smaller teams have over their bulky, sometimes obese counterparts.

#1 Easier exchange of information

Communication is the backbone of any team. When there are way too many people in a team, communication tends to get diluted. By the time the information reaches the person responsible, only a residue is left. And then begins the blame game. Ultimately delivery suffers.

#2 Generate optimum productivity

Now, this can spark a debate. But a smaller team that comprises smarter individuals can always be more productive than a bigger but not-so-smart team. Though there are other influential factors that could determine productivity. But a smaller team will mostly be less affected by these factors.

#3 Better probability of rapport building

In our day-to-day work, we tend to underrate the importance of rapport building. The bigger a team the harder it is for people to connect with each other, and build a rapport that lasts. In smaller teams however, it’s that one single weapon that can actually rescue you from the worse strikes ever. You could be at your all time low, or you could be facing an unforeseen challenge, the rapport that your team has internally, can actually turn the tables in the most amazing fashion.

#4 Weak links are quickly identified

One can be really good at making the right hiring decisions. But there are some low-performing individuals that end up seeping into every team. These individuals are one of the key reasons that lead to businesses losing their shine. In bigger teams, these individuals can be identified only after the damage is beyond repair. In smaller teams, however, one can identify them at a very early stage.

#5 Drive a better sense of belonging

Every team has people from different backgrounds. Commonalities are rare. We are all unique in our own way. But certain common ties help bringing teams closer. Aligning teams to the vision & goals of a company is one of the most difficult things to achieve. But certain initiatives come a long way in driving a better sense of belonging in smaller teams. These initiatives can be easily & quickly implemented in smaller teams. More often than not, it’s this sense of belonging that differentiates a good company from a great one.

ABOUT THE AUTHOR

Rajive Dhavan is a serial entrepreneur, and the author of the book, STFU – Start The F*** Up, for present and future leaders of startups. Having launched his first startup at the age of 22, he heads three successful companies – What’s In a Name Creatives, Namesake Productions, and Just Flaunt Salon. He can be reached on www.rajivedhavan.com.

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