We have grown to twenty employees with a flat structure where everyone reports to me, but I am bottlenecked and need to appoint our first formal leadership team. How do I choose who gets a seat on this new team without causing a mutiny among our loyal early employees who do not make the cut?

Question

Tyler Smith · Accepted Answer

To build your first formal leadership team without causing a mutiny, you must remove all personal sentiment and rely entirely on the Accountability Chart. Early employees often assume that seniority or tenure automatically entitles them to a seat at the leadership table. This is a dangerous trap that will paralyze your business as you scale.

First, design the ideal Accountability Chart for your organization as it needs to look twelve months from now, completely independent of the people currently in the business. Focus strictly on the major functions needed to run the company, which typically include sales and marketing, operations, and finance.

Second, evaluate your current team against these defined seats using the GWC tool: do they Get it, Want it, and have the Capacity to do it? You must also ensure they are a one hundred percent match for your Core Values.

Third, communicate the change transparently. Explain to your early employees that a leadership seat is not a reward for past service; it is a highly demanding role with specific accountability for driving the business forward. Those who do not fit a leadership seat can still be highly valuable, well-compensated individual contributors or managers. By making the process entirely objective and focused on what the business requires to scale, you eliminate personal favoritism and maintain team morale.