Real World Results: It’s Hard and It Works
Organizational Physics is a proven framework for designing and scaling your business. Founder Lex Sisney is one of the world’s foremost experts in organizational structure and design. He has personally helped to transform several hundreds of companies, in 16 countries, and in industries as diverse as software-as-a-service (SAAS), machine learning, manufacturing, energy, consumer goods, health care, biotech, payments, hospitality, import/export, distribution, field services, mobile, publishing, and more.
The results speak for themselves: within 7 to 9 months after implementing Organizational Physics, most clients show a sustained 65 to 75% improvement in internal operating performance and simultaneously realize a 2X to 3X increase in sales over the next 1 to 3 years. In fact, a handful of well-positioned clients have grown 10X in that time-frame, achieving multi-billion-dollar valuations.
Here is a sampling of some real-world results:
- A $40M biotech start-up was struggling with management execution and coordinating across multiple geographies and product lines. The founder was a thought leader with a research background who definitely understood the technical side of his business. He was also a first-time CEO, however, and he was naturally overwhelmed with internal operational issues at scale, despite having a COO to support him. By better defining the next stage strategy and implementing a new organizational structure and design, this same CEO took the business to more than $100M in sales in under three years, with very lucrative margins. As of this writing, he has received two competing multi-billion ($B) buyout offers.
- A $150M publicly traded consumer goods company was attempting to seize a new market opportunity but found itself going up against much larger, well-funded competitors. It had to innovate new product offerings while bringing together a complicated supply chain and distribution model. Of course, it also had to maintain and improve GMP quality standards. Using Organizational Physics, the company redesigned its structure, accelerated its execution speed on the new opportunities, won several best-in-category awards, and grew to become the number 1 or 2 competitor in its categories. The company is now valued at more than $1B and they are expanding into new international markets from a very strong foundation.
- A five-year-old venture-backed start-up was growing fast and had reached 300 employees. But as it grew, its internal execution got more complex and things started to bog down. Inside the company, one part of the business was fighting against the other. There was also a lot of conflict between members of the founding team and new senior-level hires brought in to help the company scale. As a result, sales were flattening. By implementing Organizational Physics, this company created a new structure with clarified roles and responsibilities to support the expansion strategy. They also implemented an improved management execution process to bring the structure alive. The results? Internal infighting plummeted, velocity increased, and revenues were up 60% within 9 months.
- A $15M a year venture-backed start-up was struggling with focusing its strategy and attracting new senior leadership. Working with the CEO and leadership team, we put in place a quarterly 1-page strategic execution summary that clarified the strategy, accountabilities, 90-day-, 1-year-, and 3-year-priorities, and the core ideology. We also redesigned the organizational structure, put in place a new management process, and helped to recruit and integrate a VP of Sales and a VP of Operations. Three years later, the company more than tripled its revenues and is on track to hit $100M in sales.. At the same time, the company founder and CEO went from spending 10% of his time in his Genius ZoneTM to spending over 80% of his time in that zone.
- A 5-year-old company had been losing money since its inception. It had a strong culture but was suffering from customer turnover and too many competing priorities, with no way to manage them effectively. In three months we implemented a new go-to-market strategy, restructured the company for clearer accountability, and streamlined the decision-making and product development processes. The result? The company reached cash flow profitability for the first time and is on track to reach $50M in sales and 30% EBITDA the following year.
- A 9-year-old venture-backed software-as-a-service (SAAS) firm with $10.5M in sales was stalled in its expansion strategy. Sales were growing but not nearly fast enough. After six months of searching, the company was 0 for 3 on making critical key hires including a Director of Engineering, a COO, and a VP of Marketing. The board was getting impatient and making rumblings about replacing the founding team. The founders themselves were feeling ambivalent about the business. In three months, we realigned the founding team and helped them rediscover their original passion. We created a new environment for faster execution and uncovered the real market opportunity. The result? The company found and hired three new A+ executives and its momentum is accelerating. Its forecast is to more than double sales in the coming year.
- The regulatory market had changed radically on a $35M Inc. 500 Fastest Growing CompanyTM. Using the the Strategic Execution Coaching Program, we identified and executed on a new pivot strategy. While its two largest competitors went bankrupt, our client had their most successful quarter ever. In addition, the founder freed himself up significantly from his old role of managing daily operations to his new role of creating new marketing campaigns and developing new markets (two things that he loves to do and add the most enterprise value to the business).
- A $30M medical device manufacturer engaged Organizational Physics. The company was having a hard time making the leap from a founder-led organization to a well-coordinated execution machine with multiple global offices. One year later, with the founder operating still as CEO but now much more in his Genius Zone and with the a structure and management process to support it, the company doubled in size to $60M. At the same time, it increased its operating profit margin and management capacity. Soon after, it received a $240M+ buyout offer, scoring a very high return for its shareholders.
- A 20-year old software company had gone through a very challenging period and sales were flat. Its legacy product quality had suffered as a result. At the same time, the market was changing and it had to innovate to capture a closing market window. We clarified the strategy, put in place a new structure and management process, and built a new product management system. Within nine months, the company had transformed its product quality on its legacy product to meet client expectations. Simultaneously, the company scoped and launched a new innovative product that sets it up for success for the next generation. Revenues were up 18% within 12 months. More importantly, the culture has pride and is excited for the future.
But Wait… What About the Projects That Didn’t Work?
If most clients achieved substantial results like these by using Organizational Physics, what about the few who didn’t? Good question!
First, I want to thank the clients that didn’t have great results because it is from them that I learned the most. Second, there’s two types of scenarios where the client’s internal environment didn’t allow for a change to occur: international tribes and low-margin service businesses.
By “international tribes” I mean companies that were created by merging or bringing together multiple factions from different geographic and ethnic regions from around the world. These were companies in name only and each fiefdom, formed from national or regional identities, hadn’t yet came together around a common set of vision and values. I showed up prepared to work on strategy and structure but I should have shown up with a team of United Nations conflict negotiators. Good lesson.
And in terms of low-margin services businesses, well, there’s a reason that most VCs will tell you that “services suck.” It’s very hard to make a sustainable change in an organization when fee-for-service clients dictate the priorities. There’s not enough margin to invest in non-billable people and resources to help make the shift to a more proactive business model. It’s just hard.
So outside of those extreme examples I’ve found that the principles and processes embodied by Organizational Physics will drive transformative results for most types of companies. But just take my word for it, here’s what other CEOs are saying..
What Other CEOs are Saying:
“A year on after the Organizational Physics Strategic Execution Coaching program, we have managed to achieve our ambitious goals and employee engagement within the business is equally high. Between finding the book, connecting with the author and now having a coach engaged on the growth stages of the company, our time with Lex comfortably goes down as the best investment we have made during our transition into scale at Yoco.”
– Katlego Maphai, Co-founder & CEO, Yoco
“In my experience, Lex Sisney is a genius when it comes to organizational structure — how to design a business so it can grow with the right people in the right seats with a structure that “pushes authority down” whenever possible. Our company is in a totally different place than it was before our work with Lex. Our digital products division had a $2 million positive swing in its bottom line in just one year’s time. And our leadership team now consists of an engaged group of 13 people (many of whom were promoted to their new roles during the restructuring process) with a very high level of commitment, clarity, and “shared consciousness.”
– Tami Simon, Founder & CEO, Sounds True
“When we hired Lex, our company was 5 years old with 300 employees. We had never taken a hard look at how our functions were laid out or who was responsible for what. Lex’s framework, Organizational Physics, gave all of us a lens to think about how we could make our structure better support our strategic objectives. During a 2-day offsite, Lex helped the entire team discover what was holding us back and where we really wanted to focus our energy. Finally, he helped us implement a decision-making process that has freed us to make big decisions and move faster. My hope was that he would help us accelerate our velocity and he did exactly that — just nine months later our revenue is up 60%. The kind of work that Lex does is not easy but it is well worth it.”
– Issac Oates, CEO, Justworks
“Lex and Organizational Physics took us from a $150 million dollar start-up to a $1.5B business. Our start-up had grown quickly from just me and my co-founder working in a basement to $150M valuation. But we had grown so fast that we had outgrown our structure, management processes, and lacked a strategy to keep growing. Lex gave us sound principles, led a major company restructuring, changed the way we meet, think, and make decisions, and gave us the tools to become a “Unicorn.” I’d say Lex’s help is invaluable. But in our case it was worth a billion dollars! If you’re dealing with similar complexities in scaling your own business, I highly recommend speaking with him.”
– Adam Miron, Co-founder & Chief Brand Officer, HEXO
“Lex is a trusted and wise counselor who has found a way to apply the laws of thermodynamics to any business or organization. His framework is like an efficient machine code that is useful in any environment. Lex has helped us simplify our organizational structure, dramatically improve intra-company communication, and operate more effectively. Perhaps most importantly, Lex has helped us to find better ways to serve clients. This has contributed to a near doubling of revenue and company size in 12 months.”
– Michael Chambers, CEO, Aldevron
“In my opinion, the effectiveness of a framework is dependent on its ability to endure long after the facilitator is gone. The principles Lex has developed not only endure; they’ve become self-reinforcing. And the tools and mental models that I’ve picked up working with Lex will be permanent fixtures in my toolbox. Form follows function is a “sticky” idea that Lex brings to life like no other. And it helps that he’s a great guy who’s fun to work with!”
– Daniel Needham, President and Chief Investment Officer, Morningstar Investment Management
“The results of collaborating with Organizational Physics have been transformational. We have a much flatter organization with a highly energized management team. We executed “entropy reduction projects” that greatly increased the quality of our products and responsiveness to our customers. We also redefined the markets for our products from a $60M niche market to a $300M+ market with potential for further growth. Lex has a unique blend of experience, critical thinking, tools and boundless energy. If you want to grow your business, energize your people, build a great culture and have fun while doing it, then I highly endorse and recommend Lex Sisney.”
– Bob Reback, CEO, Cimetrix
“As a leader, is your team organized and aligned to perform optimally for your company? Are your key players in a structure where they can succeed for themselves and for you? Do they want to? Does everyone know the game plan, how they fit into that plan, and how to succeed as an organization? Lex and Organizational Physics will give you a proven framework to optimize your company and ensure that you can execute more seamlessly and powerfully to achieve your goals faster and get results you previously only dreamed of. Don’t take chances. Don’t learn the hard way. You don’t have time. Get the answers that have helped hundreds of leaders worldwide improve the performance and happiness of their organizations from a proven innovator who gets real results with real companies like yours everyday.”
– Justin Bellante, CEO, BioIQ
“Lex offers great strategic guidance and an outside perspective that helped move my organization to the next level. Lex led an executive team offsite for my company and also worked with me in advance to help guide me in refining my vision and goals for the company. During the offsite, the team was given the opportunity to assess our current competitive, operational, innovative and financial situation. It was a safe place for them to voice their opinions and an unusual chance for me to hear candid input. From there, the team worked together, with the help of Lex’s well thought out process, to decide what our priorities would be moving forward. We also created a new structure, metrics, and an improved decision making process. The result was a plan that was clear and the team was committed to making it happen. We did it again a year later to hone our skills and further build our team. The model works! The company has since grown more than 30% and our culture has never been stronger.”
– Jean Thompson, CEO, Seattle Chocolates
“Lex is a wizard at organizational structure and design. Prior to working with Lex, our organizations had inefficient structures that grew more complex with each new hire, yet Lex helped us reorganize our teams around basic, easy-to-grasp principles. Today as we hire, we reference Lex’s “four forces of management” framework to make sure we’re hiring the right people for the right roles. In other words, if you want your organization to run more smoothly, you need a sound structure to build from. You should learn from Lex.”
– Darren Litt, Internet/Mobile Entrepreneur
Lex is a master of organizational design, leadership team dynamics and talent assessment. After reading his books Organizational Physics and How to Think About Hiring, and being impressed with his advanced thinking on organizations, we engaged Lex to help us optimize the organization structure of our growth stage healthcare software company, Kareo. Lex helped us improve our organization structure, align responsibilities and key metrics to the right leaders, and tune up our leadership meetings. Our work with Lex has led to faster and more effective execution with increased role clarity and accountability.
– Dan Rodrigues, Founder & CEO, Kareo.com
“Lex provides insight and guidance that you could only get from someone who’s walked in a CEO’s shoes. His method, Organizational Physics, is a no-nonsense approach to building a solid structure that allows for scalability and success. All you need is a business with potential and Lex will provide you with the tools your company needs to get to the next level and beyond.”
– Kelly Foy, CEO, Elite Meetings International, Inc.
“Working with Lex is making a HUGE difference in the growth of my business. He has developed powerful frameworks to view the entire business lifecycle that are extremely practical. I am able to move much faster, make decisions quickly and chart both near and long term because of our work. Lex is a great compass and sounding board. Lex is an extremely accomplished Entrepreneur and very humble, a combination that I admire immensely. I am grateful for the opportunity to have Lex as a trusted advisor/friend/mentor and coach.”
– Seth Epstein, Emmy Award-Winning Producer and CEO of LosYork
“Lex, in seven months of executive coaching with you I have added an equivalent of $87 million in assets under management, and increased billable fees by 40%. I have discovered where my power comes from and experience more confidence, clarity, and an ability to view my life almost constantly in a positive way. Our engagement has been successful beyond my imagination, and I could not have achieved any of that success without your guidance. Thank you.”
– Kelly Smith, CEO, Certis Capital Management, Inc.
“In the midst of our pursuits, we too often fail to step back and ask obvious but important questions. What really am I trying to accomplish? How do I define success? Where am I expending energy and not seeing a return? Organizational Physics helps answer those questions by providing a framework for breaking down your business (and life) to its functional core. In a wonderful marriage of Eastern and Western philosophies, science and art, Lex’s revelatory approach allows you to assess your circumstances and take decisive action. It is impossible not to reap massive rewards from spending time with Lex – and, having worked with him, I can say without fear of overstatement that humanity would benefit if everyone followed the principles he puts forth.”
– Ophir Tanz, CEO, GumGum
“The Organizational Physics model, and Lex’s coaching through it, helped me to understand how to match our product with the right customers and the right internal resources. This enabled me to build consensus at a challenging time, while winning some key deals through a product repositioning. Lex was always helpful and positive. His experience as a CEO really made a difference. He usually understood my perspective quickly and accurately. I will always keep Lex’s tools in my toolkit.”
– Ed Stevens, CEO, Shopatron
“When leading an Inc. 5000 fastest growing company, you know the importance of hiring the right people. The steps Lex describes in How to Think About Hiring, combined with the assessments contained within the PSIU Talent Management Suite, have helped us revolutionize our hiring process. The results, when compared to our earlier methods, are tremendous. We’re clear on the type of person that would be most successful in the new role. We then use the report as a guide for doing a deep dive in our interview process. This is helping us ensure that the people we hire are both successful and happy in their new positions. As far as I’m concerned, it’s a game changer.”
– Jeremy Ames, President, Guidant Financial
“When it comes to organizational structure and design, Lex is both guru and a sherpa! What do I mean? After leading the successful merger of two of the leading companies in our industry, I knew that I needed some help integrating two different companies and cultures into one and to supercharge our overall growth. Lex is a leading thinker on organizational structure and design and helped my entire team to see the need and benefit of changing how we operate in a new reality (the guru). Then he helped us to integrate the new structure, roles, and management processes and make it all work well together (the sherpa). The result is that we now have one integrated company and culture that is executing more quickly on its strategy. We could not have done it nearly as fast or as well without Lex’s guidance.”
Vicki Kroviak, CEO, Monte Nido & Affiliates
I think the ONE essential requirement for an entrepreneur’s success is the capacity for introspection. Coaching with Lex helped me recognize – even after 10 years in my business – that the successful entrepreneur knows his or her own strengths & weaknesses, and builds his role in the business around them. As our business grew, I kept getting pulled into fires that were outside of my “genius zone” and thus took a lot of energy from me. If you have a great team and yet haven’t learned how to get out of the way, they will also experience energy drains and stress, and your business won’t perform to potential. This was my own challenge.
The Organizational Physics Strategic Alignment and Organizational Design Workshops helped me create an organizational structure that could best support my strengths and place our team members in roles consistent with their own “genius,” where they could the most successful. Lex also helped us design a leadership team meeting structure that has significantly increased our capacity to make good decisions, implement them quickly, and communicate effectively. In addition, we’ve developed better practices for hiring, with a 19% increase in employee happiness (verified through TinyPulse) year after year. I could not provide a more enthusiastic recommendation of Lex or Organizational Physics.
– David Nilssen, CEO, Guidant Finanical
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Below are a handful of informative studies from Organizational Physics coaching clients below.