When a team is just starting out, the top priority isn’t hiring — it’s setting clear rules

What’s the most common mistake in the early stages of starting a business?

It’s not lack of funding, nor a wrong direction—it’s: people are on board, but rules are not.

For a small team of three to five people, everyone is a friend or a "brother"—they carry burdens together and drink together. You think talking about rules hurts feelings; since we’re all our own people, why bother with so many red tapes?

What happens then?

When a project goes wrong, no one takes responsibility. Everyone looks at each other: "That’s not my job, is it?"

Some people come late or leave early, but you feel awkward to say anything—after all, they’re friends.

It gets even trickier when it comes to bonuses. Everyone gets the same no matter how much they work. In the end, the hardworking ones feel unfair, and the slackers think they deserve it.

The team doesn’t fall apart because of external enemies—it falls apart first because of its own chaos.

If you’ve been through this, or if your team is still in its early stages, you must take a look at **the First Line of the Army Hexagram (师卦初六)**.

The First Line of the Army Hexagram (师卦初六): Set Military Rules Before Sending Troops

The line text of the first line of the Army Hexagram is simple: **师出以律，否臧凶 (The army sets out with discipline; lack of discipline brings misfortune)**.

What does it mean?

"师出 (Setting out the army)"—it means the army marches to war, or the team starts working on a project.

"以律 (With discipline)"—it means to restrain with discipline, rules, and standards.

"否臧凶 (Lack of discipline brings misfortune)"—"否臧" means not good, not strict. If discipline is poor and rules are lax, the result is misfortune.

These six characters lay bare the core truth of team management.

What is the Army Hexagram? It is water within the earth, the hexagram of the army. What does warfare rely on? Superior numbers? There are countless ancient battles where a smaller force defeated a larger one. Better weapons? Not necessarily. It relies on—discipline.

A well-disciplined team of 1,000 can fight with the momentum of 10,000. An undisciplined team of 100,000 is just 100,000 stragglers, falling apart at the first strike.

The *Xiang Commentary* says: "The army sets out with discipline; losing discipline brings misfortune."—lose discipline, and misfortune follows. There is no second outcome.

Many entrepreneurs want to build a "family culture" or "flat management" at the very beginning, thinking since everyone is brothers, there’s no need for those pretentious rules.

Wen Laoshi often says: Brothers are brothers, rules are rules. If you don’t even have rules, when problems arise, you won’t even be brothers anymore.

Why Small Teams Need Rules Even More

A while back, a friend came to me to vent.

He said he’d been running his startup for two years, and his team had grown from just himself to over a dozen people. Logically, things should be getting smoother, right? No—instead, he’s getting more and more exhausted.

He’s the first to arrive and the last to leave every day, worrying about everything. What about his employees? They clock out right on time, not wanting to stay even a minute longer. Assign a task, and you have to nag them again and again before they hand it in. And the quality of the work they submit is a total mess.

He said, "I treat them well, right? The pay is decent, benefits are good—why can’t they care as much as I do?"

I asked him, "Do you have clear job responsibilities?"

He said, "We’re a small team, so we arrange things flexibly—whoever’s free takes it on."

I asked again, "Do you have clear assessment criteria?"

He said, "We’re all fighting together, isn’t it too formal to do assessments?"

I said, "Then you’re exhausted—you brought it on yourself, didn’t you?"

This is exactly what "否臧凶 (Lack of discipline brings misfortune)" from the first line of the Army Hexagram means: if your discipline is lax and rules are unclear, the bigger your team gets, the heavier your burden becomes.

Why do small teams need rules even more?

Because large teams have systems, processes, HR, and departmental barriers—even if there’s chaos, it won’t get too out of hand. Small teams don’t have any of that; they rely entirely on personal management. How many people can you supervise by yourself? You can keep an eye on three or five, but what about a dozen? What about a few dozen?

And small teams have a characteristic—**one bad apple can spoil the whole bunch**.

In a big company, one or two slackers don’t make much of a difference; the people around them are still working. But in a small team, as long as one person slacks off or is irresponsible, the whole team’s rhythm gets thrown off. Because there are so few people, everyone’s weight is high.

That’s why the smaller the team, the more you need to set rules upfront. It’s not about distrusting people—it’s about protecting people: protecting those who work hard, so they don’t feel treated unfairly.

Three Basic Principles for Setting Rules

How do you set rules? The first line of the Army Hexagram only says four characters: "师出以律 (The army sets out with discipline)". But how exactly do you implement this "discipline"?

I’ll give you three most practical tips.

**First: Be tough on terms first, be a gentleman later.**

Many people do it the other way around—be a gentleman first, be tough later. At the start, everyone is all harmony and everything is negotiable. But when problems come up and you bring up old scores, it’s already too late.

The right approach is to lay all the unpleasant facts on the table on the very first day the team is formed. What’s allowed, what’s not; how to reward good work, how to punish mistakes; who’s in charge of what, who has the final say—make all of it clear and write it down.

You might think this is too rigid and unfeeling. But think about it: is it better to be a bit rigid at the start, or to have a falling-out and fight when problems arise?

Be tough on terms first, be a gentleman later, and everyone ends up being a gentleman. Be a gentleman first, be tough later, and you won’t even be friends in the end.

**Second: Fewer rules work better.**

Don’t come up with dozens of rules and regulations right off the bat, thick as a book—no one will bother to read them.

For a small team, three to five rules are enough. For example: no taking kickbacks from clients, no leaking company secrets, deliver on time without delay, don’t shift blame when problems arise. Just these few rules, simple and clear, everyone can remember them.

The key to rules isn’t quantity—it’s whether they can be enforced. If you make 100 rules but don’t enforce a single one, it’s worth nothing. If you make three rules and keep every single one of them, they work better than 100.

The "discipline" mentioned in the first line of the Army Hexagram isn’t a mountain of red tape—it’s those few bottom lines that must be upheld.

**Third: The leader must follow the rules first.**

Rules aren’t made for employees—they’re made for everyone. The person who should follow the rules most is you yourself.

You demand employees not to be late, but you show up at 10 a.m. every day. You demand employees not to slack off, but you scroll through short videos during work hours. You demand employees follow the rules, but you change decisions on a whim whenever you want.

Then the rules you set are just a joke.

In ancient times, leading troops into battle emphasized "setting an example". Generals ate the same food and wore the same clothes as soldiers, so soldiers were willing to fight to the death for them. Managing a team now is the same logic—only when you do it yourself do your words carry weight. If you can’t do it yourself, no amount of talking will help.

Why does the Army Hexagram start with "discipline"? Because without discipline, there is no army. A team without rules isn’t a team—it’s a gang.

When to Loosen Up, When to Tighten Up

Of course, rules aren’t set in stone.

The first line of the Army Hexagram is the first line, representing "setting out the army"—the very beginning stage. At the start, you need to be strict and lay a solid foundation. But when the team matures and everyone has formed good habits, you can loosen up appropriately.

It’s like learning to drive. At the beginning, the coach watches your every move—turn signal, clutch, gear shift—you can’t make a single mistake. Once you’re skilled at driving, these movements become automatic; you don’t even have to think about them and you won’t mess up.

Team management is the same.

In the early stage, rules should be strict and detailed, so everyone knows where the boundaries are. Once everyone has reached a consensus and formed habits, rules can shift from explicit to implicit—from "I have to follow them" to "I want to follow them".

What’s the worst thing? Doing it backwards.

If you’re slack and loose at the very beginning, everyone gets used to being free and careless. When the team grows bigger and problems pile up, it’s hard to tighten up again. Once people’s habits are formed, changing them is harder than anything. By then, if you set new rules, everyone will think you’re making trouble for no reason.

That’s why the first line of the Army Hexagram is placed at the first position—it’s not without reason: **when it comes to rules, the earlier you set them, the better.**

A Few Final Words

When it comes to entrepreneurship, what matters in the end isn’t who has more ideas or better luck—it’s whose team is more stable, whose organization is more capable of fighting.

A disciplined team, even if it loses a battle, can reorganize and fight again next time. An undisciplined team, once it loses once, falls apart and can never be gathered again.

When the first line of the Army Hexagram says "师出以律，否臧凶 (The army sets out with discipline; lack of discipline brings misfortune)", it’s not asking you to be a cold, ruthless manager. It’s letting you understand: the truly responsible way to lead a team isn’t to get along with everyone and be a nice guy—it’s to set up rules, so everyone knows what to do and what not to do.

With rules, everyone knows where to direct their efforts. With rules, hardworking people have something to look forward to. With rules, a team can go from "a group of people" to "a fighting force".

The day you set up your rules is the day your team truly begins.