Communication debt: need for empowering small and mighty teams

Key Points: Increasing number of people on a team increases communication inefficiencies exponentially We should hire highly capable people, pay them more, to reduce our headcount

Photo by Brooke Cagle on Unsplash When building and scaling a business, the common notion is to get funding, expand quickly and acquire customers aggressively. Expanding the team increases the resources and capabilities of the company, hence enabling the product to be iterated faster — aligning with the interests of the customer.

However, I argue that larger teams can be counter-productive in scaling a company. Rather, what is needed is small and mighty teams. I believe that we should avoid large teams at all costs, and to maximize the efficiency from the minimum number of people required to achieve a certain product requirement.

The interaction between human brains and information transfer is inherently extremely inefficient. Relying of verbal and written communication is tough and often miscommunication can arise. Moreover, different humans do not operate synchronously. While one co-worker is working, another may be surfing Reddit. It may take half an hour before he gets back to work and receives the information the former co-worker wanted to communicate. This information transfer literally took 30 minutes — due to the asynchronous nature of human lives. This is a far cry from modern computer networking and communication systems which can transfer information within milliseconds. While one solution is to train the team to be better communicators, there is a limit to the yield of that approach. A more efficient approach is to minimize the number of roles available and maximize the output from everyone. This reduces the need for communication and allows for integrated workflows and reduction in process bottlenecks.

To visualize the exponential communication debt of larger teams, we can see it in terms of an exponential function.

Graphical depiction of communication debt As shown by the graph, increasing the number of the people in the team will exponentially increase the difficulty of communication and henceforth the probability of miscommunication within the team. This can be partially mitigated by changing s by training and improving the communication skill of the entire team. However, this does not mitigate the fact that the difficulty of communication still grows at an exponential pace.

Therefore, even in the early stages of a company, it is crucial to hire high performing, highly productive individuals. It is important to find people that are able to do the work better than 3 separate hires combined. It can also be argued that for such individual they deserve to be paid higher than 3 separate hires because he will mitigate the communication debt carried by the company.

To put this into perspective: if 1 person is able to perform at a level that replaces 3 separate hires, we would mitigate the communication between 3 people. But it goes beyond that. Because this one person has the knowledge of what would have been 3 people, other co-workers will now only have to refer to 1 person for information. Meetings will also be smaller and more engaging.

In conclusion, while it is tempting to hire people that are affordable at the early stages of a company (due to low cash reserves), it might be wise to take the communication debt acquired into consideration.