tomtunguz.com · 2012-05-30 · 5118d

Are We Investing Enough in Our Managers?

The article argues that management quality is a critical but undervalued investment in early-stage companies, where 80%+ of operating expenses flow to compensation and managers influence 14-23% of the employee base. The author recommends measuring management effectiveness through 360° reviews, employee satisfaction ratings, skip-level meetings, and attrition analysis, and proposes investing in management coaches, mentorship, and education as ways to improve organizational outcomes.

3 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

Compensation as Percent of Operating Expense

80%percent

minimum

Early-stage startups

Manager Influence by Organizational Size

23%percent of headcount

average

30-person startup with 7-person span of control

Span of Control

7direct reports per manager

average

Early-stage startups