Great startups are idea meritocracies

Most organisations make decisions based on hierarchy and position, so teams simply execute their leaders’ vision. In an idea meritocracy, opportunities are pursued based on their merit. Startups work best as idea meritocracies because they are idea-rich and resource-poor — prioritisation is crucial. Even a startup that expertly executes will fail if its strategy is flawed. Ray Dalio, the creator of the largest hedge fund in the world, coined this concept in his book Principles.

In an idea meritocracy, all people raise ideas, regardless of their position. Customer success employees raise product ideas; accountants suggest new ways of working to support teams; product managers recommend pricing strategy changes; junior staff submit ideas with managers from other groups; and customer service staff uncover content marketing ideas. People need to feel empowered to raise their voices for this to happen.

An organisation with freely flowing ideas has many more opportunities to consider than an organisation where most ideas come from management. To create an idea meritocracy, you need a way to determine the value of each idea so that you can focus on what will most move the needle.

In an idea meritocracy, we frequently do the hard work to evaluate, teardown, and debate ideas. For the uninitiated, this can be an uncomfortable experience. But we achieve great outcomes by embracing this discomfort.

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