Bumping Bozos Theory of High Growth Disaster

A business colleague today was telling me of a time he heard Bill Joy, one of Sun's founders, talk about what he called bumping bozos. The theory is that in an early-stage company, the entrepreneur is probably hand-picking good people and things work well. Then those people are picking others but still the original group gets to meet people and screen out those who won't work. Eventually, though, the company gets big enough that the entrepreneur and hand-selected early employees no longer get to meet everyone. At that point, some Bozos get into the organization.

This isn't necessarily a problem - yet. There are only so many competent people in the world, and you aren't going to get them all. Yet these clowns aren't complete problems because there was probably some area of talent they showed. But outside of that narrow space, they are dangerous because they will suggest things that could only crawl out of a clown car - seemingly tiny to start, but suddenly expanding into a ridiculous concept under any degree of sane observation.

Even this isn't necessarily a problem. The problem occurs when a Bozo reports to a Bozo manager, who then signs off on the clown car emissions. When that happens, the company is in real trouble because there are no longer any common sense checks and balances.

I sometimes wonder whether many companies are in quest of too much growth - that maybe deliberately restraining the ultimate size could result in nice regular income with higher profit margins than they might ordinarily see.