In today’s column I want to return to a topic that I am becoming more and more convinced is central to success of companies once the reach a certain stage of growth. I think it is important because it is also bit counter-intuitive and so it is hard for Founders who have reached that stage to recognize both the issue and the way to deal with it.
That being said, though, I believe there is academic research that points the way to both the problem and its solution, but it’s not research that ever gets associated with the “entrepreneurial skillset” because it the research tends to focus on large publicly funded projects.
So let me back up a bit and talk about what I call “The Complexity Horizon.”
There comes a moment in the life of every growing business when the old ways stop working. The strategies that once felt sharp and nimble suddenly feel scattered. Meetings fill up with discussions of problems rather than reports of progress and plans for the future. Priorities slip through the cracks.
When this starts to happen, he founder’s instinct is usually to work harder, to get closer to the details, and regain control—but the harder they grip, the more things seem to fall apart. That moment is the complexity horizon. It’s the point at which a small but growing business crosses over a line where instincts that got you this far—however effective they once were—simply don’t work anymore.
After seeing it happen to multiple founders – I now believe that this IS a real thing and that are good reasons for why it happens. The conclusion is based on personal experience and academic teaching that I have done, but it is also based on listening to and working with Founders who are very much reaching or passing their own Complexity Horizons.
And when I say Complexity, I mean it in a very particular way. If you’ve read my other work on complexity, you’ll know that I and drawing some the called the Cynefin framework and project management theory.
So, let me make the connection concrete. The Complexity Horizon is the point in a business’s development when the Founder—or leadership team—can no longer understand or control all the inputs to the system. In engineering terms, you lose control of the boundary conditions. Up to this point, your business meets the Cynefin definition of Complicated. It has many moving parts, but they behave predictably. A skilled Founder can look across the whole system, pull the right levers, and get the expected results. Cause and effect are still mostly linear.
But once you cross the Complexity Horizon, the dynamics shift. You start to get outcomes that don’t match the effort. Problems emerge from unexpected interactions. Two good decisions made in isolation produce a bad result when combined. You’re no longer managing a machine—you’re trying to guide a living system.
If you have been there, you probably know what I am saying is true – even if you have never used words like Complex and Complicated to describe the difference. So let me explain the difference the way the Cynefin framework defines them. A Complicated system has many parts, but each part behaves according to known rules and interacts with the rest of the system in known ways. Think of a jet engine or a financial model. You can disassemble it, optimize each part, and reasonably predict the output when you put it back together.
A complex system, on the other hand, has interdependent parts whose relationships change over time. It’s sensitive to context. Feedback loops dominate. Small changes can create big consequences—or no consequences at all. Anyone who has any real-world military experience will understand. Any military operation – or even exercise – always meets this definition. No plan ever survives first contact with reality. In a complicated system, your job is to control. In a complex system, your job is to sense, respond, and adapt to what reality has given you.
And the hard truth is that most founders don’t recognize the Complexity Horizon as they cross it.
But they feel it.
They feel it when the backlog grows faster than the team can work. They feel it when firefighting becomes the default management style. They feel it when good people leave because roles are unclear or priorities keep shifting. They feel it when no one—including the founder—can quite explain how decisions are being made anymore.
And they feel it most when the tactics that once made them successful—being hands-on, fixing things personally, staying close to every decision—start making things worse.
That’s the signal. The problem is no longer about scale or funding, or experience or expertise. It’s about complexity.
Because when you’re on the far side of the complexity horizon, there is no going back, you need a different way of running the business. You need an “operating system” built not for control but for leadership. Not for command and optimization but for coordination and sense-making.
How do you get there? I honestly believe there is a way of approaching the problem that makes sense and which makes dealing with complexity make… well… more sense. It isn’t a simple menu or prescription. It literally means updating your mental and company model of how things work – which is why I refer to it as and operating system. I can’t and won’t try to describe the whole process – it’s worth a lot more attention than I can give it here. The key elements include
Understanding the concept of complexity and how it changes not only the nature of the problem, but the ways in which it can successfully be approached.
It means replacing the focus on plans and objectives with a focus on outcomes and pre-requisites. It means understanding that the current plan is only one means to achieving your ends.
It means learning how to analyse your situation and options in terms of priorities not specific actions. And it means learning how to effectively communicate your priorities and ensure that they are being respected.
And crucially it means replacing the concept of management with the concept of leadership. Effectively it means understanding that the Founders job is to select and lead a team that can implement the Founder’s priorities, obtain the prerequisites necessary for success, and ultimately achieve the desired outcomes.
Without the need to be told every day what exactly it is they should be doing.
In short, this is a mindset shift, but it’s also a set of practical tools. The goal is to create a framework that helps leaders identify what really matters, set priorities that stick, and on letting Founders lead rather than getting lost in the details of management.
And let me absolutely clear on one thing. This is NOT failure, it IS Maturity.
One of the biggest risks for Founders is taking the signs of complexity personally. When things get messy, it can feel like you’ve lost your edge, or your team is slipping. But more often than not, what’s happening is natural. You’ve grown. Your business has grown. And now you’re in a new environment.
It’s not that you’re doing things wrong—it’s that you’re doing them in a system that changed shape under your feet. Crossing the complexity horizon does not mean you have failed. Its what happens when you make it to the big leagues. And so, it’s time to upgrade how you operate.
Founders often get praised for grit, vision, and passion as well as their technical know-how. And rightly so—those are the traits that get a company off the ground. But to successfully cross the Complexity Horizon and to continue to accelerate Founders need to add new tools to their bag. They need to learn how to become the best leaders they can be and let others have the joy of taking them where they want to go.
If you’re feeling like the old way isn’t working, you might be right. You might have crossed the complexity horizon. And that’s not the end of the journey—it’s the start of the next chapter.