Captive centers: start-up challenges Date:   Wednesday , January 02, 2008 Success mantra books and articles about “How to start your own business”, “Critical success factors for your entrepreneurial venture”, “Valuing your company”, “How to market yourself in the e-age” are all there for the picking. My question is “How do I make a captive start-up successful?” and I haven’t seen too many articles that answer this question. So I want to talk about some of my key experiences around starting a captive unit for a huge U.S. based, multi-billion dollar retail organization. Don’t compare a start-up captive unit to an entrepreneurial venture; the challenges faced are quite different. They can range from “Our home corporate policy states that we do this in a specific way and can’t deviate from the established norm”, and extend to “So do I report into someone in the U.S. or someone here?” among others. Of all the issues I can think of, I want to focus on one very important aspect - it needs to be out there - and I’ll explain why – yet it can just as easily be overlooked. In a captive start-up, it is the absence of systems and processes. Take our example – in just 9 months, we’ve gone from zero to 200 people. This number sounds small when you compare it to a large established systems integrator or services provider that already has 50,000 employees plus. The difference is that the established services provider has been around for many years and has systems and processes that have evolved over time. Not so with us. In our case, suddenly 200 strangers find themselves working together, in teams, across senior and junior levels. The organization wants them to perform cohesively, but doesn’t have process maturity or backend system support. The ‘system’ is still evolving. Every person joining comes from a different organization, with different cultures and environments behind them. So what do these strangers do? Since they don’t see a strong, existing culture, they’ll start saying things like “In my previous company, we used to do it in this way….” This is causes opinion polarization and is quite unproductive. You might not see it on the surface, but they create cracks in the organization’s foundation. What should the leaders do? I have found that two actions can work magic - open communication and involvement. As leadership prioritizes on issues facing the growing organizations, keep employees in the loop. Use all channels of communication available. In a transparent situation, employees understand the motivation behind the resulting action. Additionally, solicit regular feedback from all sections of the organization the leadership might miss on acting on issues that are perceived as important. This is a great opportunity to involve the employees in building a solid organization. Since it is a new venture, employees are passionate and excited; harness this. If a sense of purpose and excitement is shared across levels in a growing organization, it motivates and inspires everyone to stretch themselves to contribute that little extra. It helps leadership in resolving existing issues faster and with greater harmony, making those very systems and processes fall into place that create the pressure in the first place. The author is Managing Director, Supervalu India. He can be reached at anilesh.seth@supervalu.com