• Phimation Strategy Group

Second Stage Management - The Rubik's Cube of Business

Several months ago, I spent time with two puzzles that my kids found at their grandparents’ house – a “15 Puzzle” and a Rubik's Cube™. The 15 Puzzle is flat, with 15 numbered squares and a space for a missing square – the challenge is to get the numbers in order by moving the pieces into the “open” space and rearranging them one square at a time. The Rubik’s Cube was an original from the ‘80s, and still had scattered colors because it had never been solved.


These two puzzles symbolize for me the change that I see as I work with small businesses that are changing from Stage 1 to Stage 2. Stage 1 businesses are complicated; as we know most fail. But Stage 2 businesses add a whole new dimension to that complexity. As a result, what worked in Stage 1 often does not work in Stage 2 – what’s needed are new ways of thinking and new approaches.

What does that mean for Stage 2 leaders?


Framing the issue is important. I had never solved a Rubik’s Cube, so I found directions for how to do it. The first thing I noticed was that the way I had always thought about solving it (one side at a time) does not work. I had always framed the problem, and the solution, incorrectly, and so my attempts were doomed before they started. Many times I see second stage leaders mis-understanding the problem they have, framing it in a way that makes sense for a business’ Stage 1 but will not solve the problem in a business’ Second Stage.


It helps to know the formulas. When solving the Rubik’s Cube, there is a set of formulas that works. Over and over. And there are endless other approaches that do not work. If you don’t know the formulas, solving the Cube is really hard – doable, but only after a lot of trial and error. If you do know the formulas, it takes practice, but it’s not terribly difficult. In Stage 1 businesses, trial and error is a good way to manage a highly uncertain situation. With second stage management issues, though, once you have framed the issue appropriately, most issues have a formula for solving them – but many second stage leaders try to solve it with continued trial and error instead of getting the formula.


You need a systemic approach. With the two-dimensional “15 puzzle,” my 9-year-old son experimented his way to a solution without it taking too much time. (He now solves it regularly in less than 2 minutes.) With the Cube, he didn’t come close and still doesn’t. When I learned to solve it, I had to get comfortable that, if my overall approach was right, and I was following the formula, then there would be times when an individual move looked like it was making a mess, but it was really part of the solution. In the same way, the complexity of a Stage 2 business sometimes requires leaders to deconstruct what they have already built (something that is very hard for Stage 1 leaders to do) so that they can build a new way.


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