Last week I spent an afternoon with a leadership team of a company I just invested in (more on that later). We’re already in the middle of a systems overhaul, doing the unglamorous work of mapping how the business actually runs.
We started where I like to start, by boiling the company down to first-order principles. This business in particular does two things well: it stores customer information, and it acts on that information.
After we mapped that out, I ‘flipped’ the question (because the flip is usually where the useful answers live). How does this business serve its customers poorly? Easy. We ask customers for the same information twice. We lose it. We forget it. Everything we designed that afternoon was in service of protecting those two principles.
It was a good session. We stress-tested the sales side by asking what breaks first if lead volume doubles, and the honest answer was a proposal process that takes 25 minutes per proposal, which at current volume already eats about four hours of someone's week. We found a workflow that was built 16 years ago and hasn't moved since, and I told them exactly what I thought of it. It's probably a great workflow for 2009. We tweaked it and moved on.
But something kept nagging at me through the whole afternoon. Every third question, the room was answering secondhand. These are sharp people who know their business cold, so the guesses were probably right. Still, whenever the conversation touched production, the part of the company where the work physically gets made, nobody in the room could answer from the floor.
What does the schedule really look like eight weeks out? Where do most repairs come from? Which process would a new hire struggle with first? Somebody would say "I think," somebody else would say "we'd have to ask," and the question would get written down, parked, and sent out of the room to find its answer somewhere else.
So I said my rule of thumb out loud, the one I use to decide who sits in a leadership meeting. If the only people I could talk to on the entire team were the people in this room, could we still solve every problem in the business? We walked it together. Finances, covered. Sales, covered. Customers, covered. Production, represented by proxy.
In my experience leadership meetings fail in two directions, and most teams only guard against one of them.
The first failure is bloat. Seats get added by title, by tenure, by courtesy, until the room is a crowd, the scorecard review drags, and the honest conversations migrate to the hallway afterward. Everyone knows this failure. It's loud, and it announces itself every single week. If your leadership meeting requires you to have another meeting after to get work done, you do not have a leadership meeting.
The second failure is the gap I focused on here. A part of the business lacking representation, that no one thought to give representation to. You can sit in a gapped meeting for a year and never feel the gap. You just feel a little slower, and you can't say why.
The trap is that the two failures feed each other. The fear of bloat is exactly what talks a team out of adding the seat it's missing, and the memory of one crowded meeting hardens into a permanent policy of keeping the room small. A small room feels like discipline right up until it can't answer a question. So I stopped trusting the feeling and started running a test.
Working Theory: The Seat Test
Run this on your leadership meeting once a quarter.
Ask the question with the team in the room. If the people here were the only people you could talk to on the entire team, could we still solve every problem in the business? The walk-through matters more than the verdict. Saying "production, we'd have to ask" out loud is the finding.
Walk the business, not the org chart. I use three buckets: how we make money (marketing and sales), how we deliver on what we sold (delivery of services/products) and how the business is tied together (finance, people, systems). The bar in each bucket is firsthand knowledge. "We could check with someone" is a fail. That's the whole point of the exercise.
Fill a gap with proximity, not seniority. Add the person closest to the information, whatever their title says. In our case that's a production lead. The seat exists so the room stops guessing, so pick the person who ends the guessing.
Run it backwards to catch bloat. For every current seat, ask which problems the room could no longer solve if that seat disappeared. If the honest answer is none, that seat is a courtesy, and courtesy seats are what make meetings long and candor rare.
