Why Fast Growth Actually Makes Your Company Slower (+ The 5 Systems That Fix It)

Greetings Operators!

Every week I love looking back at what discussions I’ve had with clients and partners, and finding the best one to share with this community.

This week alone, I’ve

• conversed over email with over 30 of you

• had 12 phone calls

• done a few zoom sessions to work through touch operational problems in your businesses.

Please remember, you can respond to this email and it will go directly to me. I’d love to help you anyway I can; with a response, a Loom video, or a meetup. I love getting to know everyone that reads this weekly!

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ISSUE

Last week, Steve, who owns a real estate company, shared a familiar story. His business grew from $3M to $12M in 18 months, but instead of getting easier, everything was getting harder…

Read | Watch | Listen
Level Up

• 📖 Tim Grover - Coach to Jordan and Kobe, on Eating Healthy - something I’ve been digging into in order to raise that SMB energy for 2025.

• 📺️ Chris Voss, FBI Negotiation Expert, sharing top tactics, applicable for sales, career, and relationships.

• 🎙️ [didn’t listen to much this week 📉 ]

MAIN ISSUE
Why Your Growing Company Is Slowing Down

… Steve discovered something counterintuitive about business growth: As his revenue tripled, his team's ability to coordinate decreased exponentially. It's Metcalfe's Law in reverse – the same principle that makes networks valuable works against organizations as they scale.

When teams hit this wall, they often try solutions that make things worse:

• Adding more people

• Implementing new project management tools

• Increasing meeting frequency

• Restructuring the org chart

The Real Cost of Poor Information Flow

My research reveals a striking pattern: Teams spend between 25-45% of their time managing information rather than creating value for customers. This isn't just inefficiency – it's a direct cost to your business.

Consider what happens when you add one operations manager:

• Regular meetings with leadership

• Daily coordination with sales

• Warehouse oversight

• Procurement planning

• Customer service alignment

• Financial reporting

Each new person creates an exponentially increasing load on communication and coordination within your business.

Each new process interacts with more people and parts the business.

Each existing process is handling more variety and volume.

Everything gets more complex.

Five Systems That Solve Scale Problems

After helping over 50 growing companies, I’ve identified five essential systems that work together to solve these coordination challenges. Each serves a specific purpose, but their effectiveness comes from their integration.

1. Transaction System: Creating a Single Source of Truth 

Your business needs one place for all transaction data. The right system depends on your current size and growth trajectory.

For small business ($0-5M):

• Retail: Square/Toast + QuickBooks

• Services: Jobber + Xero

• Custom: Airtable + accounting software

For mid-size ($5M-50M):

• Acumatica 👈️ My preference

• NetSuite (best for complex operations)

• Intact (strongest financial controls)

2. Knowledge Management: Building Organizational Memory 

Good knowledge management helps you capture and share solutions, preventing repeated mistakes and redundant problem-solving. It also reducing risk of repeated problems, and the associated brand damage that occurs as a result, while making it easier to get new hires onboard with how things are done.

Examples:

I've seen companies try everything from Google Docs to Notion, but I strongly recommend Confluence. Here's why: It's purpose-built for documentation and doesn't try to be everything to everyone. Notion is popular but becomes chaotic at scale - too many options, too much flexibility.

Key practices:

• Document processes after improvements

• Create templates for common procedures

• Use clear naming conventions

• Include specific examples

• Schedule regular reviews

• Assign clear ownership

👉️ Tip: Rather than responding to questions directly, create the answer as a page in your documentation, and then send a link. It will force you to document, and will focus on areas where there is lack of clarity.

3. Communication: Making Async Work 

Effective communication balances keeping people informed with allowing focused work time. The goal is reducing interruptions while maintaining clarity.

Proven approaches:

• Set async as the default

• Use channels over DMs

• Mark availability clearly

• Keep discussions in threads

• Reserve broadcasts for urgency

• Maintain consistent channel names

After testing every major platform, I consistently recommend Slack. Teams, Google Chat, and Discord all have strengths, but Slack's integration capabilities and customization options make it the clear winner. Just avoid these common pitfalls:

4. Execution Tools: Managing Work at Every Level 

Your execution system needs to handle both daily tasks and major initiatives without creating confusion.

Structure work in three tiers:

• Individual Level

  • Daily tasks

  • Personal deadlines

  • Individual projects

• Team Level

  • Shared projects

  • Dependencies

  • Handoffs

• Organization Level

  • Strategic initiatives

  • Cross-functional work

  • Company objectives

I've used Monday, ClickUp, and many others, but I always come back to Asana. Why? It does one thing - task management - extremely well. Tools like ClickUp offer more features but become overwhelming. The simpler tool often wins.

5. File Storage: Making Information Accessible 

Effective file management means information is findable and available to the right people at the right time. For file storage, I recommend Dropbox over alternatives like Google Drive or Box. The key difference? Offline sync capabilities and cleaner sharing mechanics. Google Drive is great for collaboration but becomes messy at scale.

Essential practices:

• Create consistent folder structures

• Use clear naming rules

• Set role-based permissions

• Archive regularly

• Document your system

• Maintain standard templates

Implementation: The First 30 Days

Change doesn't have to be disruptive. Here's a measured approach to implementing these systems:

Week 1: Assess Current State

• Track time usage

• Find communication bottlenecks

• Measure information management costs

Week 2: Choose Focus Area

• Identify primary problem

• Select appropriate tool

• Plan implementation steps

Week 3: Begin Changes

• Train core users

• Run initial test

• Collect user feedback

Week 4: Expand Usage

• Extend to full team

• Monitor adoption

• Track improvements

Understanding the Impact

Consider the numbers: With 50 employees averaging $75k salaries, information management costs between $937,500 and $1.69M annually. A 20% improvement creates significant savings and gives your team more time for valuable work.

Next Steps

Start with these actions:

1. Track team time use for one week

2. Document information flows

3. Calculate coordination costs

4. Select your first improvement area

P.S. Share your biggest coordination challenge – your situation might help other readers solve similar problems.

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