Efficiency vs Effectiveness

I started reading Keith Ferrazzi's Who's Got Your Back. I had read his book Never Eat Alone years ago and enjoyed it, so decided to pick up this one.

I haven't gotten very far, but Keith made a comment that stopped me cold: 

In the information age, success is less about efficiency than effectiveness—that is, the ability to get the right things done, rather than just the ability to do the things right. (page 18)

This explains so much. 

There's been a distinctive trend in the "efficiency" and "productivity" books to determine not only how to spend your time more wisely, but also what that time should be spent on. I've read many of them and even blogged about a few, and I know from personal experience how challenging it is to choose the next "right" thing to do, but I have to admit I never connected the dots.

Given all the apps that help us be more productive and how connected we all are, it really is less about efficiency. Yes, building efficient and scalable systems still has merit and is still needed, but you have to first choose which systems to spend those valuable resources on. In other words, before you can streamline something, be sure that you should be spending your time on it to begin with!

So for those of us with too much to do, before you try to muddle through and/or use every productivity app you know of, stop and evaluate your choices first. I'd start by listing out—whether literally or figuratively, whichever you prefer—all the possible tasks and projects you could spend your time on, then determine which one is right for you next, given your priorities of the moment. Then and only then determine the most efficient way to tackle that task or project.

If you work for someone else, you may not have full autonomy on what is "right" for you or not. But you know (or should ask) what is most important for your boss and team and then be most efficient about that top priority.

To summarize, determine what is right (aka, effective) first and then how to do it better (aka, more efficiently).

So what would make you the most effective now?

Note to Hiring Managers: Stop Punishing the Victims

Do you know anyone who's happy at work? 

I've had two different friends complain in two days that everyone they know is miserable at their job. There's obviously something severely broken here, yet employees are the ones suffering and penalized if they try to leave too soon.

For most people, quitting is not an option. Very few of us work for the fun of it and not for the need of it. If you're lucky and you enjoy what you do, count your blessings but if like most people I know you hate your boss/job/company etc, you're stuck there until you find something hopefully better. You'll look or think of looking for a new job but depending on how taxing your current job is, you may not have much bandwidth to really look. And since you need the salary and/or benefits or both, leaving without having somewhere else to go is not an option.

Some of us are so miserable at work that we fantasize about being let go. Yes, our lives will be harder since unemployment only goes so far, but at least it will be a lower-level of misery and we'll have time to look for a better job. Many of us eventually get this wish granted given how many companies resort to layoffs first when times get tough. (And yes, this is another example of how everything's broken. I've written about various ways to improve culture.)

So you have employees that have either been let go several times and/or have been lucky enough to voluntarily leave miserable jobs behind. If they jumped out of desperation and/or were mislead, their new job's honeymoon period will be too brief.

And then they're miserable again.

Is the above scenario the employee's fault or are they the victim? I'd argue for the latter. Unless they bail after two or three months and do so repeatedly, in this day and age anyone leaving after nine months or longer is probably justified. Better yet, ask them instead of assuming they're at fault.

During one of the two conversations I mentioned at the beginning of this post, my friend told me of someone who was waiting for the one-year anniversary before leaving a job that didn't turn out to be what she hoped for. I don't know the specifics so won't conjecture on why, but I remember thinking and commenting on how arbitrary that one-year milestone is. If someone puts up with a miserable situation for twelve months rather than ten months, are they really less of a "risk"? Would you rather an employee remain with you miserable and disengaged for longer or would you rather they speak up and then move on if the situation can't be fixed? 

I think part of what is broken is how employees are viewed and treated. We are not widgets but individuals with different strengths, work styles, and interests. If you value this and allow for the differences, you will truly get the best out of your people and have low turnover. It won't matter how often your new employee bounced around before or why: if you hire smart and treat them well, they'll be happy to stay with you as long as they're able to keep learning and contributing. But if you, like so many other companies out there, just want any warm body doing exactly what they're told then yes, keep worrying. Your only solution to high turnover will be hiring a true widget or robot.

Have you had to bounce around due to jobs that were bad fits? Have recruiters/hiring managers given you a hard time about this? 

Good vs. Bad CEOs

Ben Horowitz, in his book The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers, spends a lot of time discussing CEOs. Given that the book is about what he learned as a startup CEO and what he now looks for as a VC, it's practical and well-thought out advice.

As per Ben, there are two types of CEOs: those that are good strategically and those that are good functionally. The first kind has no problem with decisions but isn't great at execution; the second one is great at execution but suffers from analysis paralyis. A good CEO needs both skills and has to teach himself to be competent in the other area.

Two of the criteria Ben uses to evaluate CEOs are—

1. Do they know what to do?
2. Can they get the company to do it?

In order for a CEO to succeed at these, he has to set the strategy and vision for the company. Ben explains that to do this well, CEOs have to give this context via story, which will explain the why behind everything the company is doing and why staff should go along with this.

The CEO then needs to hire the right people and build a culture where people can do their work. If staff know that good things will happen to them and the company if they do their work well, they will want to keep coming back. On the other hand, if they have to worry about politics or other barriers to getting work done, then the CEO has failed.

Although the above may seem harsh, I totally agree that a company's culture stems from the top, so it really is the CEO's responsibility to ensure that staff are happy and able to do their work.

As Ben clearly demonstrates, being a CEO is a tough and lonely job and not for the weak of heart or will. 

What other characteristics do you think make a successful CEO?

Staying Open to Opportunity

What do potato chips, popsicles, and chocolate chip cookies have in common...besides being addictive junk foods? Apparently they were all invented by mistake. I learned this recently from one of the speakers at my son's elementary school graduation.

Most of the speeches were actually quite good and inspiring, meant to both acknowledge how far the graduates have come while encouraging them to go further. But this speech stood out because of its message.

We have to be open to what life presents us, while also being flexible and patient. The inventor of the popsicle was an eleven-year-old who knew to wait until he was older and the timing (and product) were right. The other two inventors came up with their ideas by being flexible and were then open enough to recognize the potential they had stumbled upon.

Inspiration or happy mistakes are not limited to the young or the graduating. Nor do accomplishments or inspirations always have to be as large as inventing a new junk food. If we see a need or an injustice and do something about it, we are acting on an opportunity that presented itself.

And sometimes those opportunities are on the other side of trials, tribulations, and mistakes. Sometimes we have to survive some falls and hard-won lessons to recognize the opportunity for what it is. 

I don't wish the latter on my son and hope his path is easier than mine has been, but I need to believe—choose to believe—that I am a better person for the mistakes I've made and that I am now ready for that next opportunity.

Are you open to the unexpected?

When's Your Management Training Conference?

I was impressed to read in Uncontainable (by Kip Tindell) how seriously The Container Store takes training employees. And I've worked at companies where certain functions (mainly sales) gets training and conferences, but I've never heard of a management training conference. Have you?

I absolutely understand that without sales, no one gets paid so salespeople need to get all the training and resources possible to sell better. But there are other equally important functions that seem to be ignored—i.e., managers. 

Not only are people promoted for the wrong reasons (as I wrote about in my earlier post about the Peter Principle) and not checked for their ability to handle this difficult position, but they're rarely given any training. If you're lucky, you'll be sent to some "new managers" training for a day or two then thrown to the sharks. 

Countless books and studies now confirm that people leave their managers, not their jobs, and that bad managers cause long-lasting health problems. So bad managers either lead to high turnover (the topic of another post) or to sick and underperforming staff and bottom lines, yet preventing this does not seem to be a priority for many companies.

My recommendations:

1. Senior managers should gauge who is interested in management.
2. These candidates should go through an apprenticeship where they shadow a good manager, are mentored by them, and learn by observing and discussing what works and what doesn't.
3. These candidates then should be promoted to an assistant management role where they have one or two staff to manage, while being closely supervised and mentored.
4. If the above works, they can be promoted to manage more staff, with check-ins on an ongoing basis; if the above does not work despite feedback and mentoring, they are returned to their previous role with no penalization.

This will ensure that only the right people—those with affinity and training—get to have control over another's livelihood and health. 

And let's take this a step further. Have a management conference so all your managers can get together, learn from experts and each other, and go back rejuvenated. Encourage them to keep learning and to come to you, their manager, if they're unsure how to proceed. Role play with them. Help them develop further by being a good manager to them. 

If you're a manager, would you like a management training conference?

Leadership Does Not Exist Without Communication

One of The Container Store's Foundation Principles, as Kip Tindell explains in his book Uncontainable: How Passion, Commitment, and Conscious Capitalism Built a Business Where Everyone Thrives, is that Communication IS Leadership.

The Container Store has a very unique culture. Not only do they have all employees help recruit and pay them double the going rate, but they invest heavily in their training and development. They also communicate absolutely everything with them (except for each other's wages).

By ensuring that everyone is aware of sales figures, goals, initiatives, etc., they empower each and every individual to make informed decisions to help achieve those goals. By ensuring they hire the right type of people and then train them to know everything about the company inside and out, and everything about their products inside and out, they empower them to truly help every customer and build a loyal following.

Their focus on communication also helped The Container Store during rough patches. Whether it was having employees understand the measures taken to protect their jobs during the recession, or having them be part of the development and roll out of the Foundation Principles, every employee was fully informed and behind what the company was doing. There are no secrets or surprises at The Container Store, so as Stan Slap taught us, employees can focus on being productive instead of paranoid. 

Reading all the great stories Kip shares about their company and culture made me both envious and hopeful: envious of the employees lucky enough to work in this environment and hopeful that there will eventually be more Conscious Capitalist companies out there.

At the heart of this particular foundation principle is that communication leads to trust and there is no leadership without trust. Can you think of a leader you truly trust? What's his communication like? 

Doing Good Leads to Higher Profit

I love reading about companies and leaders that have figured out that if you treat everyone right, you'll actually end up ahead. Turns out there's a whole movement that believes in this called Conscious Capitalism, which I learned about from Kip Tindell's book Uncontainable: How Passion, Commitment, and Conscious Capitalism Built a Business Where Everyone Thrives.

For organization junkies like me, my favorite place to browse outside of a bookstore is either the Staples organization aisle or just anywhere in The Container Store. I tend not to go in there often since there are too many tempting things, but I knew it was a special place from my few visits (and based on what they sell of course). Reading Kip Tindell's story about how he, his wife, and his co-founder started the chain and embedded it with their unique culture was just inspiring.

The Container Store works really hard to uphold their Seven Foundation Principles. These include hiring great people and paying them twice the going rate since they are worth three good people; training those people to really help customers solve problems; helping everyone in their supply chain succeed; and being transparent and open about all their communication. They believe, as do the others who are part of the Conscious Capitalism movement, that if you treat your employees, vendors, and customers right, you will actually be more profitable while doing the right thing. 

Kip described how hard he and his entire management team worked not to lay people off during the recession. Instead they froze hiring, raises, 401K contributions and just saved money where they could. Since everyone knew of this struggle and the reason behind these measures—to protect their jobs—they got gratitude and increased loyalty instead of griping. Compare this to the leadership conference Kip attended where CEOs of large corporations were boasting and competing as to how many people were let go. Kip understandably walked out of that conference in disgust.

Since Kip and his team treat their employees with care and invest in their growth and development, these employees then shower that care on their customers and look forward to coming back to work. This is totally in line with what I recently read and wrote about and what other books on culture and employee engagement have demonstrated. 

If it's good business sense and the right thing to do, why are there so few Conscious Capitalist companies? Are you lucky enough to work for one of them?

Entrepreneurism Keeps You Humble

So you have a great idea that you're sure everyone's going to love. You probably talk to friends and family about it, get good feedback, then go out and start building it. You either bootstrap it and do it all yourself, or you get a few people to buy-in to the dream and work on it with you. 

Then you launch. Granted, it's just an MVP and you can't wait to get feedback and iterate. You tweet the heck out of it, post to Facebook and LinkedIn and do the social media dance. You share with family and friends and retweet and repost.

And then you wait. And refresh. And wait...and despair. No one is biting. People may have liked and retweeted, but no one is actually buying! 

You try not to despair. It's early days yet. You go through the above for a few more days...You even spend money on Facebook/Twitter/Google campaigns to no avail.

Then the despair sets in. If you can get beyond the despair, the humility and boundless pivots await. You thought you knew what people wanted but you were wrong.

Most entrepreneurs have personal experience with the above and a pivot or two...or three or four. Sometimes all you can do is keep trying and hope that something will work. If you're lucky to get actual feedback, you apply it but otherwise, you admit you were wrong and rethink everything. 

The only way to get beyond this is to stay humble and to stay true to your purpose. Yes, the package and/or idea and/or business plan may need to change, but there was something you strongly believed in. If you can stay true and excited about that, then you will be able to keep throwing things against the wall until one of them sticks.

If you can't get over being wrong and/or can't stay excited, then this life is not for you. 

Have you had to pivot? How have you dealt with the despair and uncertainty?

Is Your Employer Cool?

If you're like me, "coolness" is not something you give much thought to so I was surprised when Rodd Wagner listed it as one of the 12 rules in his book Widgets: The 12 New Rules for Managing Your Employees As If They're Real People.

As he explains, "cool" is difficult to define but at its core is about being you with all its inherent uniqueness. When applied to companies, these are the companies that do things differently because their leaders stay true to themselves and their visions—even when it's different than everyone else's. They don't try to be "cool" or imitate anyone else; they just do what's aligned with their vision and best for their company culture and employees. Think Southwest and its putting its employees first, allowing them to have fun and zaniness, which has led to their having 40 years of consecutive profits in a highly competitive and struggling industry.

And as with most employee and culture related issues, it starts with the leader. A CEO true to himself, using that to hire and recognize his staff instead of doing something because a consultant recommended it, is more likely to get and keep great and engaged employees. Rodd brings the example of Larry Schoenecker at BI Worldwide who started the "Summer of Love" practice to motivate his staff: summers full of parties on the company front lawn, beer, music, flip flops...and every other Friday afternoon off. This was such a success that it's now become part of their brand and all stems from Larry's defining himself as an aging hipster. But it was true to himself and his values and transformed BIW to a "cool" place others want to work for.

What struck me the most about this new rule and this chapter is the irony and the challenge. The irony that we want and need leaders to be uniquely themselves and applaud their differences and the challenge in maintaining this as you scale. Rodd explains that even Southwestern Airline is struggling to maintain its coolness after merging with the very uncool AirTran. 

So how can businesses and leaders stay true to their unique selves? I don't think there is one answer and as Rodd points out, it has to work for the individual culture to be deemed cool as opposed to fake and cringe-worthy. All leaders can do is pay attention and change things that are not working or appreciated. Being cool does not mean you're infallible.

Have you worked for a cool company? What do you think made it cool and what did you appreciate most about it?

Give Them Transparency and Meaning

Employees want to be informed and have their work be meaningful, as per Rodd Wagner in his book Widgets: The 12 New Rules for Managing Your Employees As If They're Real People. 

If employees know what's going on, they need not be paranoid and therefore can give their best efforts to their employers. (Stan Slap touched on this from a culture perspective in his book Under the Hood.) And as per the studies Rodd quoted, employees that are informed are more likely to stay at their job and recommend that employer to others; those that are not informed are more likely to do the opposite.

This is even worst for millennials. As Rodd reminds us, this is the generation used to parents discussing everything in front of them and being informed and connected at all times. They do not tolerate executives that are secretive...and neither do many others any more. Leaders sharing used to be a choice that was applauded, but now it is a must or companies will be reviewed poorly on social media sites and Glassdoor.

Employees also want their work to have meaning. Apparently even if we take a job for money alone, we are hard-wired to seek meaning and will find something at the company to connect to—unless the CEO is obviously just in it for the money. Leaders that are promoted from within are more likely to inspire meaning than one who is brought in to make shareholders happy and who has to then prove he has a purpose beyond that.

I've written about the importance of being informed before, so I will write more about meaning here.

It's nice if you have a calling such as being a doctor or teacher, where your job has inherent meaning, but most of us do not. Yet we can still apply our strengths at companies whose mission or purpose we believe in. And if we can't change jobs, we can still try to find meaning in what we do.

Do you create something that will make someone's life easier? Do you answer peoples' cries of help, whether they are technical difficulties or a false charge? Or do you deliver that much needed cup of coffee so that they can get to work? Chip Conley succeeded—during the dot-com crash in an industry that was failing—by helping his employees find that meaning.

If we as employees are treated with respect and made to feel that we have a purpose, it is possible for us to find meaning in most jobs. It's when we are treated as widgets and not respected or communicated to when everything loses meaning.

Do you feel informed and that your work has meaning? What does your employer do that makes you feel this way?

Staff Are Not Resources or Widgets

In his book Widgets: The 12 New Rules for Managing Your Employees As If They're Real People, Rodd Wagner explains that staff are not "assets," "resources," "FTEs," or "widgets." They are individuals, each with their own needs and fears, and if you want them to give you their best, you need to treat them with respect. He calls this foundation "the reciprocal employee." Show your staff caring and loyalty and get that and more back.

Rodd then goes into his 12 new rules. I've only gotten through the first two so far: get inside their heads and remove their fears. You need to understand each person's needs and fears, allay them and their concern about job security, and they will reward you with full engagement and productivity.

I am a big believer in treating everyone with respect so I am really enjoying reading all the science behind what I always knew to be the right thing to do and business common sense. Two stories Rodd relays to demonstrate this really stuck out.

Apparently power makes it more challenging for people to empathize with others. Rodd explains how all humans have mirror neurons that allow us to feel with others and even taste what we see others drinking. When a study was done with two groups of people, one group was asked to remember an instance where they were in power; the other was asked to remember an instance when someone had power over them. Both groups then watched a video of a hand squeezing a ball. The group that remembered being powerless mirrored the action within the video more strongly than the group that remembered their power. So if power mutes our ability to mirror and empathize, those in power need to be aware of this and take extra measures to reconnect with their staff. 

The second story shows that not only is it possible for those in power to truly care, but the positive impact this can have.

When Hewlett-Packard was suffering during the recession of 1970, Bill Hewlett found out that some of his managers were laying people off to cut costs. Not only did he put a stop to this, but he and all senior staff were given every other Friday off along with a 10% salary reduction. This allowed them to reduce enough cost without letting anyone go and ensured the burden of the recession was distributed across all levels. Their staff's gratitude and loyalty lasted two years for this one action.

I don't think we need a book—or a study—to explain reciprocity to us. Just think about how you feel when disrespected and how likely you are to go out of your way for that person. Now think of someone who took the time to truly listen and show they care. Wouldn't you give extra to that person, even without being asked? And wouldn't you rather work for that type of person and company?

Focus and Specialize

We all know by now that multitasking is bad and that we need to focus on doing one thing at a time to do anything well. We also know that time is limited. Every time we say yes to one thing, we are saying no to something else, so we need to be strategic about our choices.

John Bell, in his book Do Less, Better: The Power of Strategic Sacrifice in a Complex World shows us how this applies to companies as well.

John was appointed CEO of a company that had lost its focus and diversified too much. He and his team then took the unpopular choice and sold off or closed all but a few of the product lines, keeping the most profitable ones. Although the board did not approve and John nearly lost his job for this, it ended up being exactly what the company needed to recoup and become profitable again.

John lists countless examples of both companies that remained focused and became brand names and those who lost focus and therefore lost their market advantage. He also shows how "doing less better" should be applied to—

1. hiring less people: choose the ones that can really help you execute, even if they cost more; and 
2. working on less projects: choose the ones that will really make an impact.

Having this kind of focus, which is a result of the company's strategy, is the job of the CEO. And a clearly defined strategy—

1. lets everyone know not only what to spend resources on, but what not to spend resources on;
2. will help drive the company's priorities and culture; and 
3. help them differentiate and stay profitable in a fiercely competitive market.

As contrarian as it may seem, trying to add services and products is not the way to boost sales and profitability. Instead a company is better off figuring out what they do best and do more of that, better...and less of other things.

Can you think of a company that has diversified too much? Has your company or team fallen prey to this as well?

Focusing on People First as the Key to Success

I just reread Ben Horowitz's The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers. I had read it originally when it first came out, loved it, and therefore decided to make it the book to be discussed at my second YourMBR Alpha session.

I remember thinking that this book gave you an insider's perspective and hard-won lessons you probably would not get in any business school or class. Now, after having more personal experience and having read countless other business books, I still think this book has a unique angle.

Ben takes us through his personal trials as the CEO of a tech startup and the tough decisions he had to make; e.g., from selling off a part of the business, to going public when nearly bankrupt, to eventually deciding to sell the entire company. Along the way he had to make many controversial decisions, including hiring a head of sales he alone thought was a good fit.

Unlike the other startup books I've read, Ben really gives you a sense of how hard and lonely it is being a startup CEO. He goes into how to deal with the self doubt and constant second guessing, how to lay off people with respect so that the rest of the staff will want to stick around, and the differences between a peace and wartime CEO. 

The lessons shared in the book are too many to tackle in a blog post, so I'll just share one takeway from my rereading.

One reason this book is so unique, and one reason why Ben succeeded despite his challenges, is that he truly valued his staff. As one of his chapters states, you should focus on your people, then your product, and only then your profits. He made sure to share with his employees both bad and good news, to be honest with them, and to treat them respectfully at all times. Even when he had to make unpopular decisions, he personally communicated it and gave his employees the option to leave, offering to help them get jobs elsewhere.

Companies often espouse putting people first but rarely act accordingly. Ben actually did so and shows both its challenge and rewards.

Which kind of CEO would you rather follow through hard times and why?