When a company matures — but decisions still rest with three people

If you have ever led a business with more than 500 people, you know how it goes: the structure begins to operate on its own terms. Processes, roles, and layers accumulate — and what once resolved itself informally becomes an extended chain of approvals.
At one large company — whose name we withhold for confidentiality — we encountered this situation in 2013.

The firm had been operating in the B2B services market for over 15 years, employed around 1,000 people, and in practice depended entirely on three individuals: two owners and a commercial director.

Every Friday they would convene for what was meant to be a few hours — which became a full day, then extended into Saturdays. Every decision passed through them: accountability structures, invoice authority, interdepartmental coordination. A classic founder-led management model, held together by personal energy rather than organizational design.

«We simply can’t keep up with all the decisions. We need people to start thinking and acting without us.»

That was the starting point for the first transformation.

First transformation: from founder dependency to a mature operating structure

We conducted an organizational diagnostic using the Adizes methodology and identified a familiar pattern:

• premature organizational aging,
• high dependency on the founders,
• dominance of the administrative management style,
• limited process automation,
• a stable but fatigued team.

The company held a strong market position, was profitable, and retained loyal clients. But growth had stalled.

Tool: diagnostic and cross-functional problem-solving teams

Before addressing structure or strategy, we started with a thorough organizational diagnostic using the Adizes methodology.

The process surfaced more than 200 issues — half of which had been accumulating for years. Many pointed to the same underlying cause: management breakdowns were not rooted in individuals, but in the gaps between departments and in how processes were designed.

A representative example: sales expected speed from production, production needed a clear brief before moving, and finance expected everything to be approved before it had even started.

The first intervention was therefore not to fix individual departments, but to improve the way they worked together.

We introduced a system of cross-functional working teams — small groups composed of managers from different parts of the business. Each team was formed around a specific problem and structured to include all departments with a direct stake in the outcome. Critically, each team was given genuine authority to act on its conclusions.

Each team worked through one clearly defined systemic issue — spanning areas as varied as pricing policy and employee onboarding.

The objective was not to escalate problems upward, but to develop solutions that all parties could commit to — and then bring those solutions forward for formal approval.

«For the first time, we stopped looking for someone to blame and started fixing the process together.»

These teams became the organization’s first real experience of structured horizontal collaboration. The culture of shared decision-making that emerged from this work later made it possible to build profit centers and redesign the broader structure.

Tool: mission and profit centers

The next step was helping the company articulate its mission — not an aspirational statement in the startup sense, but a clear operational definition of direction:

«We are a dynamically developing company offering clients a range of information, consulting, and training services. We aim to build long-term client relationships through the best legal reference system, actively developing additional lines — training and consulting — while strengthening our regional presence through new client acquisition and improved service quality.»

From this, the strategic priorities became clear: expand regionally, invest in long-term client relationships, and build two new service lines — consulting and training.

A mission is not a slogan. It is an engineering brief for organizational design.

If the mission states «develop regions,» the structure must include people for whom regional development is a primary responsibility — not an additional one. 

If it states «build training and consulting,» dedicated units must exist to create and own those lines.

Which is exactly what followed.

A new structure was designed around three distinct elements:

• Five regional profit centers (green) — each responsible not just for sales, but for the full economics of their region: revenue, costs, client base, and service quality.

ccountability for results moved out from under the founders and into the hands of operational managers in the field.

 For the first time, it became possible to see clearly where the business was generating value — and where it was not.

• Production units (red) — responsible for content development and product quality.

Previously, all content had been undifferentiated, with no orientation toward specific audiences

Under the new model, production became an internal supplier — working for the regional profit centers as its internal clients.

Accountability became mutual: the green units could no longer say «the work wasn’t good enough,» and the red units could no longer say «no one values what we do.»

Each side understood what it owned and whom it served.

• An incubator for new business lines — dedicated to consulting and training.

Rather than converting new ideas immediately into departments, the incubator gave them room to develop under reduced operational pressure.

 created space for experimentation, iteration, and format-testing without disrupting the core business.

The structure translated the mission directly into organizational reality:

• regional growth → autonomous profit centers,
• client retention → clear accountability for quality,
• new service lines → a protected incubator.

What worked

• Cross-functional teams spent a year building the organization’s capacity for horizontal collaboration.
• The structured decision-making framework increased accountability and genuine ownership among managers.
• Resolving issues that had been unaddressed for years restored motivation and energy across the business.
• Profit centers began competing on performance — not for executive attention.
• Managers engaged with financial data and started thinking in terms of margin.
• Management maturity increased — and profitability grew 30% within a year.

What was difficult

• Emotional resistance was significant.
• People who had worked in the company for ten or more years were apprehensive about structural change.
• The first RACI matrices were genuinely hard to build.

Tools used

• RACI matrices — defined zones of accountability with clarity.
• Goal books — each team mapped how its contribution connected to the overall mission.
• Color-coded budgets — green managers were accountable for profit; red managers for cost efficiency.

Second transformation: when a black swan breaks the business model

In 2016, the unexpected happened. A key partner — a foreign company whose platform underpinned the firm’s legal database — made an announcement:

«We are discontinuing support. In eighteen months, the product will no longer exist.»

For the company, this was an existential signal. The entire business depended on that system.

The initial reaction was shock. What followed was a decision.

«If the partner is leaving, it’s time to build our own product.»

Building a proprietary online platform

The company made a clear decision: build a proprietary online platform from the ground up.
This was not simply a matter of replacing one system with another.

It required a fundamental shift in business model and technology architecture.

The existing product was built for an offline world:

• local installation,
• periodic updates,
• a heavy system delivered and configured on-site.

The new product needed to be online, flexible, personalizable, and accessible from any location or device.

The core differences:

• SaaS subscription model — not a perpetual license.

Clients no longer purchase the system outright — they subscribe, and they can leave.

his changes the entire operating logic: product quality, update frequency, client orientation, and the service model all become continuous responsibilities.

• Continuous updates — not monthly or quarterly patches.

Legal and financial professionals needed access to regulatory changes in near real time.

• Web and mobile access — replacing desktop-only installation.

The previous system was tied to a single work machine. The new one needed to work from the office, from home, and on the road.

• Personalized content feeds and notifications — replacing a shared database.

Each user would see only what was relevant to their profile and industry.

• Behavioral analytics and data.

For the first time, the company could see precisely what clients were reading, which topics were in demand, and where engagement was declining. Previously, feedback was impressionistic and arrived months late.

• Continuous feature development.

Improvements could be released at any point — without waiting for a major version update.

• Industry-specific content — replacing a universal database.

This required a fundamental rethink of content production, not just technology.

In short, the company was moving from a heavyweight offline product to a data-driven digital service built around client behavior, speed, and relevance.

«This wasn’t a system replacement. It was a move from the 20th century to the 21st.»

Development could not be discussed openly — the team remained committed to the existing brand.

The work was therefore carried out quietly, inside the development department and the incubator, running in parallel with ongoing operations.

When the new service was ready, a critical question emerged: who would sell it, and through what structure?

The first instinct was to route it through the existing regional profit centers.

This appeared logical — and would have been a serious mistake.

The teams were deeply loyal to the existing product. So were the clients.

No incentive structure would have motivated them to genuinely advocate for what felt, to them, like a competitor.

Decision: shift to a product-led structure

The company made a considered but significant decision:

• the top level of the structure became product-based,
• each product line became a separate profit center,
• industry-specific content teams were established: retail, services, manufacturing, public sector.

This decision did not emerge from an executive meeting room.

We ran a structured series of working sessions with the leadership team — sessions in which managers genuinely rebuilt their frame of reference: from «we serve clients» to «we build a product that solves a specific client problem.»

In one of those sessions, it became apparent that the existing regional structure was a constraint on growth. Sales, content, and service functions operated in parallel — but not in coordination.

What was needed were integrated product units, where marketing, content, and service were organized around a single industry and a clearly defined client.

Tools used

1. Scenario modeling — three structural variants were evaluated; the product-based model was selected as the option offering the strongest return at the lowest transition risk, while preserving elements of the regional structure.
2. RACI frameworks — enabled rapid process realignment between the new green and red units.
3. Open leadership selection — used deliberately as a cultural intervention: rather than appointing leaders, the organization created conditions for people to step forward.

«When we announced that we needed leaders for the new product’s industry teams, people came forward on their own. The head of HR said: ‘I want to move into the business. Put me in retail.’»

That is how the first product teams were formed — not through top-down assignment, but from within the organization, from individuals willing to take on risk alongside the business. One of the most significant achievements of this transition was that not a single employee was lost. Everyone found a meaningful place in the new structure.

What didn’t work immediately

• In the early months, the new product sold slowly: the market was unfamiliar with it, and many staff were still operating within the logic of the previous model.
• The legacy profit centers continued to direct resources toward established products by force of habit.
• A «shared resource» budget process was introduced — a formal procedure in which leaders of red units made the case to green unit leaders for joint investment from their budgets.

It took a full year for the new service to reach 7% of the legacy product’s revenue, as it began to establish itself in the lower market segment.

The more important outcome, however, was structural: the company had learned to think in products rather than functions.

Strategically, this was a decisive move — the organization disrupted its own model before the market did it for them.

Third transformation: from service to product business

By 2019, the company had encountered a classic growth trap.

The new structure was functioning. The online product was gaining traction. The team had developed a new way of thinking. But beneath the surface, structural tensions were beginning to appear.

The regional profit centers were no longer fit for purpose. They had been designed around an offline business: territory-based sales, local client relationships, in-person service delivery.

he company now had a digital product — and a client in one region was operationally indistinguishable from a client in another.

The geographic boundaries on which the previous model had been built had effectively ceased to exist.

The second pressure point was internal competition between the legacy and new products.

Two teams were selling the same underlying value proposition under different brands and through different implementations. One was established, stable, and generating revenue. The other was strategically positioned but not yet profitable.

The organization had begun competing with itself rather than with the market.

What had saved the business three years earlier was now holding it back.

«To move forward, we needed to integrate the old and the new. The product structure was no longer working — we were competing against ourselves.»

Decision

The company merged the two products into a unified ecosystem and fully restructured the operating model:

• a single product line at the top level,
• industry-based profit centers replacing regional ones: retail, services, manufacturing, public sector,
• functional services redesigned around digital logic — analytics, automation, and topic-based content, rather than department-based organization.

The company had moved from a service business to a product business — from client servicing to building digital solutions for defined market segments.

Content production: from generalists to subject-matter specialists

The core of the business — its content and analytical function — was also restructured. Functional divisions gave way to thematic teams organized around practice areas: tax law, employment, real estate, and others.

Initially, there was apprehension. «What if I lose breadth by focusing only on tax?»

The concern proved unfounded.

Within months, the concern had inverted. People were saying: «Now I feel like a genuine specialist. I can see exactly who I’m helping.»

Those who wanted variety moved to a different team.

 Internal mobility became normalized, and with it, a quiet culture of professional movement took hold.

Digitization and automation

In parallel, a significant automation program was underway: ERP implementation, digital tooling, and analytics infrastructure. During the pandemic, the organization completed a full transition to remote working in a single day.

«We simply left the office, sat down at home, and carried on.»

No one was made redundant.

The company stopped backfilling roles as people left naturally — and reduced headcount by 30% while sustaining operational effectiveness.

A culture of change

A year after the third transformation, we facilitated a session for a new cohort of managers.

We asked:

 «How many of you are in the same role, in the same department, as you were a year ago?»

Out of twenty people, one raised their hand. Every other person had changed their role, their department, or their professional function entirely. This was not treated as a problem. It was the norm.

«Yes, something changes every year. And that’s just how it works here.»

That is how a genuine culture of adaptation formed — not as a managed change program, but as an organizational default.

What made it possible to navigate three transformations without significant losses

• Transparency and trust

The organization never misled its people.
When it said a salary would be preserved through a role change, it was.
This removed the fear of losing one’s position — and with it, the resistance that fear produces.

• Shared ownership of decisions

The same cross-functional teams.
Every structure, mission definition, and KPI framework was developed with managers, not handed down to them.
They understood not only what was changing, but why.

• Sequencing

Transformations proceeded in cycles.
The organization built capability on smaller interventions before redesigning the whole. The culture of change was formed through experience, not through presentations.

Tools that made a measurable difference

• Structured decision-making for operational improvements — created transparency and increased accountability at every level.
• Annual organizational diagnostics — maintained the rhythm of change and enabled timely intervention.
• Restructuring cycles — allowed for purposeful reallocation of work and sustained focus on strategic priorities.
• RACI frameworks — defined roles and decision rights with precision.
• Goal books — aligned each unit’s contribution to the overall mission.
• Color-coded budgets — made the connection between resource allocation and strategic outcomes visible.
• New product incubator — converted internal initiatives into viable business ventures.
• Synerteams (cross-functional problem-solving groups) — prevented operational tensions from compounding over time.

Mistakes and lessons learned

• Attempting to sell the new product through the legacy sales structure did not work.
• The organization overestimated how quickly teams would adapt to a digital-first operating model.
• Early delegation efforts, without a corresponding revision of authority, created confusion rather than clarity.

The central lesson: organizational structure does not function independently of culture.

If the culture is not ready, the structure will not hold.

Results after six years

• 95% of revenue generated by the new product.
• 30% reduction in headcount through natural attrition — with no redundancies.
• Sustained improvement in profitability.
• A leadership culture in which change is treated as a normal operating condition.
• A new strategic challenge: the product is becoming a platform for a broader family of digital products.

New mission

«We serve the business, legal, and economic information needs of our clients within a secure digital environment for conducting transactions.»

This is no longer a software service. It is an ecosystem around which new ventures are being built.
And it marks the beginning of a fourth transformation.

Key takeaways for founders and business owners

1. Structure cannot be changed for its own sake.
    Without clarity on mission, reorganization will not deliver results.
2. Trust matters more than process.
   Without it, any transformation becomes a restructuring exercise with casualties.
3. Build capability on smaller interventions first.
   A culture of change is formed through experience, not through strategic frameworks.
4. Deliberate self-disruption is a legitimate strategic move.
   If you do not challenge your own model in time, the market will do it for you.

In closing

When we look at this organization today, the conclusion is straightforward: transformation is not a project with an endpoint. It is an operating posture.

An organization can remain genuinely alive when it is driven by clarity of purpose — not merely by KPIs, process documentation, and reporting cycles.

«We used to be an airline that knew how to carry passengers. Now we are a company that knows how to build aircraft.»

That statement from the CEO captures, better than any framework, what intelligent and sustained organizational transformation actually looks like.