Beginner Business

I stumbled on this, another example where strategy of all kinds is “the same at the top.” This is a list of principles created for WWI dogfighting by the teacher of the Red Baron:

http://en.wikipedia.org/wiki/Dicta_Boelcke

I find it really interesting that in business, often it’s about “fractal”-based success. That is, just as fractals are complex graphics based on very simple rules, business strategy is about learning to use a few extremely important maxims extremely consistently. Sort of like, sure 80% of your decisions and actions might not fall within these, but your ultimate maxims decide your fate in those 20% of the decisions that make 80% or more of the difference. The maxims basically prevent you from making really dumb decisions in the situations that are most likely to impact your success.

I think it’s a big thing, the “ultimate maxims” thing.

Part of it, that you can see from the “Dicta,” is identifying the key dynamic. In WWI, one of the biggest things was that whoever got behind the other and started shooting first, tended to win. Once you know that, you build an entire strategy around it, and until the situation changes, you have the most effective strategy. In the meantime, a lot of the other people are just trying to “be really good fighters” and so they lose, since they’re concentrating on 100% rather than being nearly perfect at the crucial 20%.

Surprisingly, the Red Baron wasn’t known for being the most brilliant fly-boy, or the most acrobatic pilot.  He was a good shot, and more importantly, a stickler with the rules. The right rules.

Ultimate maxims teach us a lot about how to actually put the 80/20 rule into practice:

1. Figure out the crucial dynamic.
2. Develop a strategy based on exploiting this dynamic.
3. Create a set of maxims that ensure you never screw up the most important things.
4. Follow the maxims more strictly than you’d like to.

The title of a post on Tom Peter’ blog caught my eye:

To Get Out of Bed. Or Not Get Out of Bed. That Is the Question.

This was one of the earliest business lessons I learned. When I was a university kid, I occasionally supplemented my two part-time jobs with odd jobs at $10/h with a local entrepreneur, doing low-level marketing tasks like passing out fliers. One day Mr. Entrepreneur calls up and says, “I’ve got a job for you, but I can only pay $8/h this time.” I told him I wasn’t interested. I could actually hear his smile on the other end of the phone.

“I see–you won’t get out of bed for less than $10/h, huh?”

That was it, in a nutshell. In that moment I understood BATNAs, BHAGs, and diminishing marginal returns in one intuitive leap. And I got a glimpse of what leadership is about.

The bottom line is asking yourself if what you do is REALLY worth getting out of bed for. What’s your time worth?

That’s a big part of leadership, and entrepreneurship is really just leadership taken to the extreme. Entrepreneurship comes from being driven to spend your time on important things.

That’s why time management for entrepreneurs is a little different from many jobniks. It’s not about seeing how many things you can cram into a day. It’s about deciding which things aren’t worth doing at all, and dropping them.

It’s about deciding what’s worth getting out of bed for, and what’s not.

There’s a feeling throughout the business world that meetings are a waste of time, yet they’re in no danger of disappearing.  Research suggests that many workers spend at least 5.5 hours per week in meetings, and the number may be more than 17 hours per week for executives.

How do you organize an effective meeting?

The number one complaint is lack of focus.  Lack of focus means lacking a clear agenda and defined goals, but also effectively choosing the attendees.  Often this lack of focus is revealed by an ambiguous meeting style, where brainstorming, status-checking and decision-making are combined.  The end result?  Many meeting attendees feel their time was wasted.

Do You Need to Meet?

Many meetings are called almost out of habit.  So before you even call a meeting, ask yourself two questions:

• Do we really need a meeting?  Or could an email or phone call suffice?
• Who needs to be there?

The Agenda

An agenda listing all items to discuss should always be sent out before a meeting; 2-3 days in advance for small meetings and at least a week in advance for larger ones.  Along with the agenda, any background or reference materials should be included.

The purpose for the agenda is not just to establish the goals of the meeting.  It’s also to give people a chance to think about any decisions they may need to make, and to prepare ideas or necessary materials in advance.

The fewer the items on the agenda, the better.  Most accounts say that more than three items is too many, and one item is best.  Even if there are several items, by sticking to one topic the meeting will still be focused.

Chairperson

Someone needs to lead the discussion.  In some cases it makes sense for the person calling the meeting to also chair it: it can help them stay on track with the topic they’ve chosen, and identify the most important questions.   However, when there is likely to be some disagreement, often the best chairperson is the most outspoken uninterested party: someone who won’t be too involved in the discussion itself, but who is able to get people to shut up and stay on topic.  Roles of the chairperson:

• Keep the meeting focused
• Prevent digressions
• Limit how long any person can talk at one time
• Start and end the meeting on time
• Ensure that quiet people are able to speak
• Accomplish the stated goals of the meeting (eg. make a decision, take an action)

Meeting Styles

Many of the meeting styles that are common in organizations are ineffective.  Status meetings can often be replaced, and just about any regular meeting (eg. weekly status meetings) tends to be a waste of time.  If you really need to get together, you don’t need the excuse of a weekly meeting.  Here are some meeting styles that work:

• Stand-Up or Huddle: It’s a lot like a status meeting, but confined to a short time period of 10 minutes or less, just before people start wanting to sit down.  This is an exception to the rule of “no regular meetings”: you can have Stand-Ups every day and actually see productivity gains.  Since you only have 10 minutes, only members of a team working together should be invited, or occasionally guests who are involved in the team’s activities.  The focus is on what you’re going to do in the next day or so.
• Action Meetings: ONLY for making decisions.  The idea is to present a problem, offer some background information, and make a decision of either YES, NO, or MORE INFO.  If more information is needed, make sure it’s still an action.  That means “think about it” or “do research” isn’t good enough, but “ask the User Interface team if they can add a status update icon” would be an action item.  The hard part about action meetings? Avoiding discussions, lengthy opinions and especially brainstorming.  If more discussion is needed, it should be part of an action.
• Brainstorming: These are hard.  The key to brainstorming is coming up with crazy ideas and avoiding criticism.  Participants should feel comfortable making jokes and suggesting silly ideas, simply because unrealistic and funny suggestions often spark more realistic ideas.  People who can’t help but ridicule or criticize during brainstorming sessions simply shouldn’t be invited back.  Not everyone is great at brainstorming.
• Nitpick sessions: Doesn’t sound like fun, but with the right attitude, these can be both enjoyable and very useful.  This is the chance to call in the incessant critics and get some real feedback.  Once you have a prototype that is soon to be ready, or a long-term plan becoming finalized, call in the nitpickers and find out early what might go wrong.
• Planning sessions: The hard part with a planning session is sticking only to the relevant level of detail.  If you’re planning out the year, choose the date for the yearly training seminars but don’t argue over which speakers to invite - just make a few suggestions.  You can discuss the finer details when you get around planning the actual seminar.
• Emergency meetings: You’re organizing a conference, and Friday afternoon you find out that your speakers for that evening are all going to be very late because of a cancelled flight?  Sometimes when something new comes up, and plans fall apart, you need to have a short meeting to change plans and make new decisions.  The style is similar to a Stand-Up but there’s more emphasis on finding quick solutions to new, urgent problems.
• Cocktails: Sometimes what you need isn’t a formal meeting, it’s just a chance for co-workers to get together in a casual environment and chat.  Whether it’s martinis, beer, lunch or coffee, keeping it “chill” often makes it easier for people to bring up topics and solutions.  Some of the best ideas I’ve seen teams come up with, have come from these get-togethers.  And don’t forget: the food and drink is essential.

The One-and-One Meeting Technique

The most effective way to hold a meeting is to stick to ONE meeting style and ONE issue.  Limit the meeting to a brainstorming on the new marketing campaign, or an action meeting to decide which of the two product designs to use. Keep it to one style and one issue, and you’ll find your meetings are more productive by an order of magnitude.

Earlier I talked about how too many cooks spoil the broth - that is, too many leaders on a team lead it nowhere. However, that’s not always true.

One team I was on was compared by one of the members to the early days of Saturday Night Live, and to prove his point the member passed around a short history of SNL for us to read. Interesting stuff. The article described how in SNL’s early days, it was a ragged yet intense group of people with great chemistry. (And yes, there was a lot of chemistry going on in every sense of the word.) It was a group of very talented people who managed to click and create something spectacular.

It was one of the rare examples of how a lot of “Makers” can sometimes create amazing things together if you somehow manage to glue them together with the right energy. I’d call it context in the sense that it’s used in The Tipping Point. With the right context, sometimes too many cooks make AMAZING soup.

Similarly in one of my favourite articles, Paul Graham talks about how his first company included Robert Morris, Jr. doing system administration. Having several “Makers” on the same team created great synergy there, too. Then there’s Google. And so on.

But often when you have a lot of Makers, eventually they leave the team. How many great SNL stars stayed on? Most left to start solo careers, just like so many rock stars.  It’s very rare that a team - or a company - is able to hold onto those players forever. Sometimes the Makers are artisans, and concerned only with their art, be it coding, comedy or choreography. It’s a little easier to hold onto talent like that, because like it or not, the talent needs the business as much as it needs them.

However, many Makers are machers in the making, to use an old Yiddish word. Primadonnas. Often Makers don’t do as well on their own as they did with their original group, but they find it hard to work well with others. They’d rather fail on their own than succeed with a group.

The question for a group leader or entrepreneur is two-fold:

1. “How can I hold onto these key people?”
2. “And, in the end, is it really worth it?”

The later years of SNL seem to answer #2 in the affirmative (and Drucker’s The Effective Executive agrees) but then the real question becomes:

“Is it more valuable to hold on to the Makers-turned-machers, or should we just get good at finding great new people?”

Notes

• Macher - Yiddish word for big-shot, usually someone well-connected who also has a swollen sense of self-importance.

You can divide people into four categories: makers, breakers, stones and stoppers. It’s a vaguely construction-related metaphor:

1. Makers - They make things happen. These are people who instinctively create, assemble or lead. Where other people see Widgets, one maker has an idea for a new iWidget. When other people see two people talking about new iWidgets, another maker sees an iWidget web site in the making. And six months down the road, maybe an iWidget 2.0 Conference.
2. Breakers - They like to tear things apart. On a bad day, a breaker will just be heard talking about how iWidgets suck and the iWidget 2.0 Conference is full of geeks who will never get a date. On a better day, he’ll be proving that the iWidget 2.0 protocol has security flaws. Breakers tend to see things divided into “bad” and “worst.”
3. Stones - Stones don’t have much initiative, but they can be very useful. You can put a bunch of them together and create walls, even buildings. And once you start pushing a stone down a hill, it keeps rolling and gathering momentum. People who are stones can support the building efforts of makers.
4. Stoppers - Some people don’t create on their own, and don’t destroy things directly, either. They simply like to slow down the efforts of others. When you’re trying to roll that big stone down the hill, the stopper is the one on the other side of the stone, pushing back.

So far, makers sound like the good guys in the group, right?

Not necessarily.

Context

It’s all about context. First, because different people are needed for different things. And second, because people take on different roles in different situations.

Makers

Makers sound like very important, useful people, but they can also be problematic. If you’ve ever been in a team where everyone was a maker, you’ll have grown to understand the old saying about “too many cooks.” A team with a lot of creative people can lead to a lot of great ideas that go nowhere, and teams with too many “leaders” can end up neutralized by power struggles.

Also, makers tend to always want to move to bigger and newer things, often neglecting core business activities in the process.

What about as clients? Sometimes, makers are great clients. They’re the ones who contribute advice in online forums about your product; they may even have created the web site. If they like your product, everyone will hear about it. Then again, in six months they may be your next competitor. And in the meantime, they’re very insistent about where the product should go. They may want things out of your product that won’t benefit 99% of the other users.

Breakers

They sound like the bad boys, and they can be. As clients, they might be reverse engineering your new product to break your security features. In your organization, they’re probably vocal about how the rules or organizational structure is horrible. They can be a pain.

Then again, they’re an enormous benefit. If your organization or product needs changing, they’ll help you know what to change and how. They probably won’t shut up about it. They’ll also be out there organizing boycotts of companies that use child labour, or convincing customers not to buy software that installs spyware–and recommending other software. If you’re the one selling the spyware-free software or clothing made without child labour, these breakers are your friends–and customers.

Stones

Stones are the foundation, so to speak, of an organization. When you get them going, they can go far. But they don’t create momentum by themselves.

A lot of this depends on the situation. I might be more of a maker in my business, but if I joined a rock-climbing class I’d be more of a stone. Why? Part of being a stone is that you want other people to show you what to do. You rely on the expertise and resources of others. While some expert rock-climbers might join a rock-climbing club as makers, intending to get really involved, I know nothing about the sport. I’d just want to show up, spend an hour a week climbing stuff, and then leave. I don’t want to pick out my gear or research great new locations. (If my examples suck, well, it’s because I really don’t know rock-climbing.)

Similarly, great leaders know when to be stones. Sometimes it means trusting projects that aren’t being done your way; other times it’s about just getting out of the way and letting the experts you’ve hired do the job. At the same time, leaders can’t afford to abdicate completely. You also have to know when to step back in. How do you know when? When the project loses momentum, becomes scattered or loses focus on primary goals.

Stones are great customers–they tend not to complain much. Then again, that’s the problem: they don’t tend to warn you before they all roll away down the hill to a product they like better.

Stoppers

Stoppers seem completely negative until you realize where you need them. A stopper in a brainstorming session will just frustrate everyone. But when the brainstorming has ended and you’re about to bet the company on a new product line, the stoppers might be there to save you from investing in something that isn’t financially feasible, or has a fatal flaw. Where makers divide things into “has potential” versus “amazing,” stoppers see “acceptable” and “inacceptable.” Stoppers can make great accountants, lawyers or QA people, but of course anyone can take on this role when faced with a new idea that they don’t believe in.

Roles

After all, the categories are just roles.  We tend to take on different roles depending on the situation.  The trick is identifying the roles people take on, and learning to see how they fit together.