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LPP Assignment – 02

The Founder’s Dilemma


ROTR

Submitted by –
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Q1. In what stage is the organisation?
Answer - Restaurant on the run (ROTR) is the Zomato/Swiggy of California. Being a food delivery start up,
and being a customer oriented organization, it requires high involvement and dedication from employees.
ROTR is currently in the DELEGATION stage of a start ups journey to becoming a fully fledged
organisation based on GREINER. It is fast growing with numerous partner restaurants including the gigantic
CPK and acquiring numerous smaller restaurants in bid to expand operations. However, internally they are
failing at delegating the right tasks to the right people. The internal structure is still a mess with no clear
defined roles and the company doesn't have a CEO. The start up, in its current position, fails to grow into a
fully fledged organisation due to the founding member’s negligence towards defined organisational structure
and its importance in formulating strong, sustainable organisations.
Although there is an impromptu assignment of tasks amongst the founders with Matthew, Anthony and
Michael handling marketing, sales and operations respectively, there are no formal departments. There is
also a lack of a holistic leader which probably prompts Day to call out on Michael. The start up currently
needs to focus on assigning proper roles and establishing functional departments to carry out daily
organisational activities.

Q2. What were the issues faced by the owners? Were they related to leadership, operations, financial or
coordination?
Answer –
Some of the major issues faced by the owners were basically related to delegation, finances and future
direction of the business. It’s not like that the owners were not making money; in fact they were making
enough money but had no idea about how to handle the cash. It’s mentioned in the case that they would hide
cash in the ceiling as they had no idea where to and how to invest that cash to generate more business.
When it comes to delegation Michael, Anthony and Matthews had divided some of the operations among
themselves but there were no written rules and at the same time they lacked expert help in their respective
fields.
This problem could be easily related to the eight hurdles of transition:
Setting a direction and maintaining focus – the owners had little idea as to what they wanted to do with their
business in future or how they wanted to expand it.
They did not put much effort to build a solid organisation and management team. Initially it was just close
friends and family members who were running the ROTR. A clear example of this can be seen when they
required extra drivers to complete customer orders.
The owners were not able to financial capability. Though they had a separate account for the tax related
queries of the ROTR, they had no idea what to do with the extra cash, where to invest it?
In all it was a problem related to transition. Their business was growing and expanding, they started
acquiring small companies in order to expand their operational areas, but they had no clear idea as to what
they wanted to do in future. Whether they wanted to be the King of their own business or they wanted to
become rich by selling off the restaurant business in future.
Q3. What should be the road ahead?
Answer - The case talks about an example of Founder’s dilemma where the founder is being faced with the
issue of being capable to lead the organization in the growth phase. Even he had got a feedback of not being
the ideal CEO for the company. The company is at a stage where process is not organized and the founders
are dependent on their hustle ability to drive the business. As also discussed in “From founder to CEO: An
Entrepreneur’s roadmap” by Joseph Picken, many entrepreneurs aspire to build an exceptional company and
retain as the CEO of the company out of which launching a start-up is the first step.
In this situation I think Micheal should be given a fair chance as he has till now not got any formal
communication from the investors or the responsibility as a CEO. He must be trained for the position before
any formal declaration of him being the CEO as opposed to making him step down which will breed
negative emotion among the other employees who are actually looking him forward as a leader. He must go
through the eight hurdles of transition as stated in the “From Founder to CEO” research paper by Joseph
Picken. He should be first setting a direction and maintaining focus about the goals of the organization and
his personal goal which has to be aligned with the organization. Then he must think on the long-term
positioning of the product and services in the expanded market maintaining the customer and market
responsiveness. He should also focus on the building the organization and management team as opposed to
the lean philosophy he has been following up till now along with developing effective processes and
infrastructures and financial capability.
Till now Michael has adopted the culture of hustle in the system but he should proceed ahead and plan out
building the organizational culture that would reflect values beliefs and norms supportive of the firm’s
business purpose and strategy even in the medium and long term.
Above all managing risks and vulnerabilities is something an entrepreneur should be looking upon with the
rapidly growing ventures with narrow revenue base, inexperienced employees, key employee deflection,
inadequate infrastructure, information and management systems and a bias toward entrepreneurial risk
taking.