Death by meetings

Meetings are important – but it is possible to have too many.

Internally, they are important for communication so that everyone knows what is happening and priorities and differences in opinion can be dealt with openly.

With clients and customers they are part of the process of building and maintaining relationships.

For those of you coming out of bigger corporations you will have to watch your own tendency to have meetings. You have just come from an environment where there are so many stakeholders and the delegation of authority you have means that decisions need to be made by consensus.

In a small startup every possible minute should be given to making the business happen. There of course needs to be coordination – for which you can have meetings. But keep a lid on it.

Make sure every meeting has a purpose (and yes, a weekly staff meeting does have a purpose when run properly).

Be creative – for example, try a senior management breakfast or have a catered lunch so normal working hours aren’t interrupted.

Most of all, recognise that you have the right to make the decisions now and while consensus is nice, it isn’t always necessary – after all you get to live with the outcomes too.

Beg, borrow and steal

Alright, don’t steal, but the principle is important to most startups.

Let’s say it again – most stories we hear about startups are for the likes of eBay, Facebook, Google, etc.  They were in the right place at the right time and found VC money willing to back them.

Now let’s talk about the other 99.99% of startups – that means you.

You put together a business plan showing a wonderful story of how you are going to get the product right, market it to customers and then revenues will grow year on year forever.

You then go and put in what you can each afford. You are feeling anticipation and trepidation at the same time.

Fast forward 6 months.

You are late on your product.

Customers can’t buy what isn’t finished yet.

The market is flat.

You worry that the standards for your product are too high, and that it will take forever to complete. Your technical people disagree.

You are running out of money.

This is the point that many people give up. Your business partners may decline to spend any more, and become detached, if not pull out altogether with demands that the rest of you to pay them out.

Now you will need to get street smarts in a hurry.

• Can you pre-sell products or subscriptions for services?
• Can you get supplies on consignment?
• Can you find other markets?
• Can you rent in cheaper premises?
• Can you offer compensation to employees and suppliers through equity?
• Can you get government grants?
• Can you find an angel investor?
• Can you find other sources of income?

Many days will be a battle, but this is where the real entrepreneur comes out.

Location, location, location

Choosing the right location for your physical business cannot be overemphasised.

Let me explain by giving real examples of it gone wrong:

• Setting up a convenience store under a building with almost no foot traffic, and no out of hours foot traffic.
• Setting up a doctor’s surgery in a building with a tall staircase for access. Mothers with children and the elderly all went somewhere else.
• A photography studio on the side of a busy road with no parking and nowhere to turn around for a kilometre.
• A major engineering company setting up offices in a location highly inconvenient for the required movement of people to the client’s offices and back.
• A new factory setting up in an industrial park with the nearest public transport a train station 2 kilometres walk away through a suburb with the highest crime rate in the city. Try getting workers for that.

A few principles to follow are:

1. Go where your customers are – seems basic, but often overlooked.
2. Be where you can be seen.
3. If customers visit then have parking and a clear access facing the street front.
4. Go where your competitors are - it’s better to be near them to allow customers to choose between you.
5. Think about how your people get to work? Public transport, parking, etc.
6. If your prime sales location is expensive, then consider a back office in a warehouse somewhere cheaper.
7. Make it easy for you to visit customers, and them to visit you. This includes plenty of free visitor parking.
8. Think of access issues for people – i.e. the elderly, disabled, mothers with prams, the young, etc.
9. Think of access issues for suppliers – i.e. loading docks, easy access and turnaround for trucks, and not disrupting other traffic.
10. Think of locating near your suppliers – that helps all of you.

It’s always darkest before dawn

An old adage that is true on so many levels.

You’ve blown your budget, you’re out of time, and you are looking at going back to regular employment…. Despair sets in. Then you get a nibble, which then turns into steady client calls.

Basically, if you believe that you’ve got the right product that the customers want, then you need to hold your nerves and stay the course.

Most people who start a business are willing to take risks to one degree or another. However, what catches people out is their own attitudes on how to deal with things when they aren’t working out.

A lot of people simply fold and give up when things aren’t working out according to their plan.

I have seen this a lot, and as someone who helps startups it is saddening to see, but often understandable. If they held out just that bit longer they might have got across the line. It’s hard to know.

So when you are against the wall, try to control your anxiety and panic. Don’t be rash in making decisions and trust that your product and your sales process will work out.

Learning by doing

Are you putting off starting your company because you feel you don’t know enough?

Are you planning to do an MBA just so you know how to do business?

If you think like this, then you are normal. These are the kinds of things I hear all the time as reasons people use for putting off starting the business of their dreams.

The reality is that it is not possible to know everything you need to. You will make mistakes. You will disappoint some customers. You will make stupid decisions. Good people will quit on you. Some products will fail. Your marketing strategy will fail. And so on.

The key point here is that you will learn on the way.

The business plan you write now is really a piece of fiction that shows how you want the world to work.

As you do business, sell your product, get feedback, have failures, etc., you will learn.

When you are prepared to make mistakes and learn from them you are in the right mindset to start your business.

The key point is that you actually have to do something to learn if it will really work or not.

No fear no effort

A little fear is a good thing.

Fear of failure, fear of losing face, fear of losing an opportunity, fear of losing money, fear of disappointing others, fear of losing to the competition, etc.

Fear is one of the greatest underlying motivations that we have.  And yes, there is a fair bit of evidence of this in research into business performance.

If you are always happy with what you do then you have no motivation to improve and no motivation to perform.

On the other hand too much fear can cripple – especially for your employees.

Try turning the fear into a positive motivator by setting up goals, KPIs, and comparing to your competitors.

For yourself,  recognise the fears you have and turn that into actions.

A little fear is a good thing.

Unleash the power of the lazy

It often surprises managers to learn that people who always seem busy can often be quite unproductive.

Why I hear you ask?  Well, it’s simple, keeping busy and productivity are not the same thing.

When time and motion studies were carried out in factory lines it was discovered that those who made the least movements to complete their job were often the most productive. Let’s put that another way – some of those workers who were considered the laziest were in fact the most productive.

If you think about a machine, then less movements means less time which means faster work.

Efficiency is about achieving results with the minimum of effort. This should be our goal, not surrounding ourselves with perpetually busy cheerleaders.

For office workers measuring productivity is damned near impossible, but I am pretty sure that the same principles apply.

I often see people spending hours doing something manually that could be done very quickly with another piece of software, or even fully using the capabilities of the software they are already using.

For your own business, if you don’t need to do something to achieve your outcome, then don’t. If you apply any of the basics of time management and prioritisation then non-essential work patterns will become clear.

When looking at your employees, look for those who get the job done with a minimum of fuss in the minimum of time. Sure, sometimes lazy just means couldn’t be bothered, cynical and bored, but if you ask your people easier ways to do things and they are not afraid of retribution then life may become better for all.

Brain sprain and other signs of severe stress

Just like when you sprain an ankle and can’t walk easily, when you sprain your brain you have trouble thinking, potentially combined with obsessive or repetitive thoughts about work. Mild sprain is stress related, severe brain strain may be a potential sign of a bigger breakdown.

I don’t wish a breakdown on anybody – but it happens.

I had some kind of a breakdown after 2 years of 50-80 hour weeks where I was basically non-functional for a few months.

I have seen a lot of others go through the same thing – sadly often only to be sacked as a non-performer.

When the levels of stress become overwhelming here are a few tips:

1. Only worry about things that you can directly control or influence the outcome of.
2. Stop thinking about the outcomes for the whole organisation, just worry about your bits.
3. Delegate, delegate, delegate.
4. Talk to you partner, friends and co-workers.
5. Reduce the amount of non-core work activities you are involved in.
6. Change your timetable – i.e. give yourselves a few more weeks to get something done.
7. Play more, with your kids, your dog, your friends. Get out, have some fun.
8. Deliberately take a half day off work to do non-work related things – even to just prove to yourself that you don’t need to be there every moment of every day.
9. Cut down or eliminate alcohol and caffeine.
10. Take up a hobby, preferably one that completely distracts your mind.
11. Exercise is always good.
12. Most of all – learn to forgive yourself.

Doing the above can take years to learn, and there’s no time like now to start.

Keep on swinging

There are always days where everything just gets to you and you feel like giving up.

There can be so many things happening, none of which are in your control so you feel irrelevant.

Your partner and friends may be telling you to just go and earn some money – somehow.

It’s easy to see when one of the entrepreneurs I work with are going through this kind of stage. The best way I can describe it is that they shrink before your eyes. Everything gets smaller – their ambitions, their ideas, their bravery. It almost makes them look smaller physically.

If you really are out of money and your credit cards are fully maxed out, then maybe you will need to be flexible.  The main thing though is to keep swinging.

To put that in another way. Keep going to work. Keep marketing (contacting customers). Keep your eye on the future. Even when life knocks you down, if you keep swinging you may just connect with something.

It will be hard to do, and if you have employees ask them to help you with the challenge of it all.

Most of all, don’t give up – even if you need to run on autopilot for a while.

You can’t fire everybody

There are occasions where you will feel an overwhelming urge to get rid of everybody and start again.

Maybe you are just in a bad mood.

Maybe your plans aren’t working out.

Maybe you are sick of employees who need so much guidance and handholding that you don’t have time to do anything yourself.

Maybe you have a management team who can’t do anything by themselves as while the excitement of a startup is good, they haven’t really had to make their own decisions before.

The list goes on.

From a business point of view it is hard to start from scratch. You will set yourself back months if not years. Instead work out how you can salvage the situation. Here are a few ideas:

1. Change your business model – if it relies on higher performance than you are getting from your employees or from a customer base that doesn’t exist yet, then change your model. 
2. Get rid of the worst performers only – the rest of your staff will recognise that you have done genuine housekeeping rather than the typically lazy approach of getting rid of 10% of all staff.
3. Keep your people focussed on what they are good at. E.g. a good operations manager may need to be kept away from anything commercial if that is not their forte.
4. Seek advisors/mentors to help you get through this stage of work.
5. If you find you need to work 15 hour days after 2 years in the business, then you definitely need to learn some delegation skills.

Resist the temptation to fire everyone who gets in the way, and use them and their good will to the company to do what they can.

Some work drains you, some recharges you

Administrative work is draining. Dealing with needy customers is draining. Meetings can be draining. Failing to convert a sale is draining. Performance managing underperforming employees is draining.

Solving problems can be invigorating. Making a sale or helping a client understand their needs and buy from you recharges you. Spending quality time with good friends and family recharges you. Reading a good book or your favourite hobby can recharge you.

Think about what makes you feel good, what is neutral and what exhausts you.

As a startup owner you are going to spend way too much of your life working on your business, so you need to be mindful of what drains you and what recharges you.

For example if you spend a week doing nothing but things that drain you I can pretty much guarantee that you will have really bad interactions with your family and colleagues. You may even think of giving it all up when despondency sets in.

If we come back to my favourite topic of work life balance and how you are unlikely to have a balance for the first year or two of your startup, then you can actually balance yourself out a bit with what kind of work you do. At least you can help your satisfaction and sanity.

For example, try and fit a bit of administration in every day, preferably just before or after lunch. That way, you use your early morning energy to get a lot of good work done, and make sure that you spend the last hour of the day doing things that you enjoy. That way, you feel better when you go home.

Another way to deal with the paperwork and drudgery is to put aside half a day on the weekend – Saturday morning would be ideal so the rest of the weekend is free to play.

Try mixing it up a bit and find what works for you - it will help you cope.

The perils of ostracism

Feeling ostracised is one of the most powerful emotions that anyone can experience.

When you are ostracised you feel rejected, excluded from the group, low self-esteem and prone to seeking revenge.

You know that feeling well from when someone important to you didn’t reply to an email or a phone call. You are waiting on their answer or response.  First you start to get paranoid and worry that they have changed their mind about helping you. Later you ignore them yourself and finally you may seek to get petty revenge.

In reality what has probably happened is that they were just busy and despite good intent didn’t get round to it.

You need to learn to handle your feelings of ostracism and keep in touch with people.

Also, you need to understand the effects of ostracism on your staff, contractors and suppliers.

Apparently it only takes two weeks to turn a high achiever into a nervous wreck with low self-esteem. All you have to do is ignore a few comments or contributions in meetings, and talk to everyone else but that person.

Examples of subtle biases include male managers in male dominant teams trying to avoid offending female staff so they don’t talk to them as with other staff,  or locals not knowing to talk to foreign/immigrant workers who end up feeling like a permanent outsider. The most vicious form is female on female bullying which is mostly about deliberate ostracism and exclusion – often by whole groups.

So reign in your own reactions and be mindful of your interactions with others.

Pioneers end up with arrows in their backs

Pioneers end up with arrows in their back. The second generation break even and the third generation make a profit.

An old business saying that captures a lot of experience.

What it means for you in starting up your company is that you should focus your efforts on existing industries with existing markets and customers.

When you are a pioneer you are trying to create the market and convince customers to try out your product. 

The movies show this as exciting. The popular press shows this as what MBA graduates as hunting out new and exciting untapped markets. Let’s call it what it really is – pissing money up against the wall.

To put that more strongly, unless you have a truly innovative idea and are backed by either a rich relative or a VC fund, don’t be a pioneer.

Even in hi-tech startups some of the big names are in fact the second or third generation of a business idea.

When a customer base has been created, use your smarts to come in and do it better and grab part of the growth away from the incumbents. This is what the third generation comment above means. If you watch carefully you’ll see that many of the most successful business people have this third generation mentality.

It makes sense really, let someone else go through all the pain and then come in and make a profit from it.

Success comes faster with good competition

Almost nothing sharpens up your business skills and attitude as much as having good competitors.

Just like the old saying that you are defined by your enemies.

What happens is:

• You incrementally improve your product, your marketing and your service by seeing what you have to do to compete.
• You are driven to not let them win.
• You find ways to please your customers better and attract new customers.
• You get energised by the competition – it gives you something to look forward to.

When you don’t have competition then you get stuck where you are and your business gets better more slowly.

Embrace competition.

Leave some things left unsaid

Work relations are a lot like personal relationships. Honesty and communication are vital. However, you can cross the line to insult and patronisation.

If someone is being a bit grumpy,  they may be having a bad time at home, they may be faced with uncooperative co-workers and don’t want to tell you about it, they may be annoyed with you. Give them a few days to get over it before you talk about it.

If someone is making a bad decision, consider letting them do it as long as the situation can be reversed to some degree later. Experience is a powerful thing.

If someone is late on delivery, they may already feel very guilty about it. Criticising them on it may not be the smartest thing to do.

If someone makes a mistake, telling them that you knew it would be that way is not the smartest thing to do.

Don’t tell someone who just made a purchase that you know of a better deal somewhere else, or that another product is better. That is just plain annoying.

People generally do the best they can. Set rules, set boundaries, but otherwise leave people to get on with things the best they can without constant commentary.

Investors understand profits

Let’s be frank, many investors don’t necessarily understand business well.

Some are investing other people’s money. Some got lucky in real estate. Some did well in their own industry but have no clue about other industry sectors.

You may be selling a hi-tech business model which they have no clue about.

However, before you exclude investors who don’t get you, you need to understand your investor’s motives – profit.

Investors want to cash out within a few years, and they would like to take out more money than they invested. Pretty obvious really.

So, when selling your business, sell the profit they can make, and find an investor who understands your business model to explain that they are comfortable with the business – kind of like a translator.

Don’t expect your investors to “get’ your genius idea. Rely on their curiosity, rely on their willingness to back an interesting idea, rely on their willingness to back an individual or team with the right attitude, but most of all, rely on them wanting to make a profit.

Your employees are not appliances

I never cease to be amazed and dismayed when I see a hiring manager show a new start to their desk and then leave them there, expecting them to be fully productive from the first minute.

This mentality is kind of like when you unpack an appliance and plug it in. People aren’t like that!

First, hire people with the right skills and attitude.

Second, accept that they don’t know your business, your systems, the other people or the politics.

Third, bring them up to speed. Deliberately allocate time to talk to them, and be prepared to answer their questions.

Fourth, appreciate good work, and encourage others to work with them too.

Even after all this some people don’t work out, but you need to take the time to bring them up to full productivity.

When people feel trusted to act then they feel valued. Yes, your productivity will drop in the short term, but the company productivity will go up.

Work life balance is a load of bollocks

Guess what – you are the boss now. The buck stops with you.

You are now responsible for invoices, payments, contracts, HR, tax, regulatory compliance, payroll, and the list goes on.

If you can afford to pay others to do all this, then I am happy for you, but most of us can’t.

For example I spent 4 hours last Sunday doing end of month payments, invoices and other paperwork. What I don’t do is to complain about work life balance.

The simple fact is that if you are going to set up a business you are going to need to earn your equity at times. The first couple of years when you are growing and cash flow is tight will be the worst.

You will bring work home.

You will work evenings.

You will start work early.

You will spend part of your weekends working too.

When you think you have finished a job you will have clients who ask for reworks when you have already fully allocated your time another client.

There are a lot of things that take up time and if you don’t act like a business owner and take responsibility it can destroy your business.

Be smart about it. Minimise your workload and if you can, try and fit it in during normal hours.

A local property developer put it well recently. “ When my friends hear about how much I am earning they imagine that I am spending all my evenings having lavish dinner parties with friends and celebrating the high life. In reality I am spending most of my evenings working and rarely get enough time to spend with my family.”

So, accept that the first year or two will be hard on your family and your work life balance and find ways to cope.

Solve indecision – flip a coin

How do you make decisions -  gut feeling, other peoples recommendations or based on careful research?

If you have university or college education then statistically speaking you are likely to take longer than normal to make a decision.

A few years ago a CEO I heard about here was frustrated that he couldn’t get a straight answer from his IT department on which new finance software platform they should adopt. When the IT managers finally fronted for a meeting they let him know that they were down to two final candidates and that they were having trouble distinguishing between them. They then requested another month to look further into the differences before making a recommendation.

The CEO looked at them and calmly asked if the differences truly were small. When they confirmed it, he said, “Let me show you how to make such a decision.” Pulling out a coin he flipped it up in the air and said, “call.”

He had a point.

When two choices are almost indistinguishable, just choose one.

Are you holding up your business with decisions not made – e.g. logo, website layout, words for your website, promotional material, letterhead, invoice formats, quote formats, etc.

Are you delaying your employees or partners by holding off on decisions.

Have a think about how important the decision you are facing is. If it is getting in the way of making money, then make a decision, any decision.  Sometimes taking a decisive action is more important than having the perfect answer.

If you are a perfectionist or a control freak, then ask someone you trust to make the call.

If everyone is coming to you for the answers then what are you doing wrong?

A company is a system. The industry you sell to is a system. That industry in turn is part of a bigger system. And it goes on.

Ultimately, everything you are involved in is part of a series of highly interconnected and unpredictable systems. 

It is impossible for one human to fully comprehend all aspects of the business they work in.

That is why there are different professions, each specialising in their small piece of the larger system.

Front line sales people are seeing the client’s needs and hearing their complaints..

Line workers see what works or not on the shop floor.

Your suppliers know if you are overly bureaucratic or unnecessarily rigid and legalistic in your dealings.

One of the greatest secrets of success is to let people loose to do what they do best. If you are a control freak then you are your company’s greatest bottleneck, and the greatest problem for future growth.

So, if all your key people are coming to you for decisions, instead of just blaming them, go look in a mirror instead. What are you doing or saying that means that they do not trust their own judgement? What are you doing to support them in their decisions? Are you prepared to let others make mistakes and learn from them?

Born leader or titanic asshole?

Wow, there is a generation with healthy self-esteem out there now who believe that they were born to rule. That’s not necessarily a bad thing when it is balanced by talent, but as we have all seen on American Idol, it is often accompanied by startling mediocrity.

We tend to forgive the truly talented for being assholes. The sports star who is out of control on drugs and hookers. The massively self-centred musician. The actor who thinks that their pronouncements on world peace will change the world. Investment bankers who believe that investing in a rising market means that all profits were solely due to their intelligence and chutzpah.

To these people it is only natural that they are the centre of the universe. Heaven help us when two of them meet, the implosion may kill us all.

As a consultant, dealing with planet size egos is part of my daily job. The kinds of people that I choose to avoid most are those who waltz into a room and take charge with no experience or talent behind them. Sometimes they are born leaders. Sometimes they are talented, but in that insane way that the most gifted entrepreneurs are. 

Mostly though, they are just clueless titanic assholes.

If you are a natural born leader, then all I can say is that you should stay nice to people as much as possible. Sheath your claws. Hold your tongue. Bestill your judgement. Stop making threats, and cease throwing unnecessary tantrums.

You are on the way up now, but when you are on your way back down (as you will most likely fall) there will be a big crowd waiting to wade in when you go splat.