How much does it cost to make a bad hiring decision? My guess is that for start up you will feel the ramifications of a bad hire for 12 to 18 months depending on how long the person stayed and the level of the position they filled.
Cost(length of stay, level of position)
It is very difficult to fund start ups and the tendency is to be cheap with hiring until you can afford it. Trust me, you cannot afford mistakes and it is either best to overpay for talent or do without. I am still seeing errors created with mid level employees that should have been terminated sooner. Of course, as the hiring manager, this is a tough pill to swallow as it reflects back on me and the executive team. Moreover, you are never sure when the cost will be fully paid, there are many mines buried out there and only through day to day operations can they be found.
Advice: pay for talent or put off the hiring until you can.
Monday, December 1, 2008
Saturday, November 29, 2008
Overcoming Helicopter Management
What is helicopter management? It's another term for firefighting, where manager react to the problem of the day, fly in and fix it and leave. Typically, the fly-in includes a ton of collateral damage and counter productive activity which includes not really teaching anyone anything, setting up the inevitable future disaster along the same lines. This has many different names and flavors, but the "root cause" is lack of finding the root cause. We treat symptoms all the time because we need immediate results. Sometimes failure and the resultant learning is the BEST way to cure a problem, permanently. I am completely guilty of flying in, hosing down the enemy and leaving. Problem solved for the immediate term, but little lasting impact, and more than likely a beleaguered staff that will simply wait for my intervention when the next fire is spotted. Bottomline --> how do you create a critical thinking work force???
This is TQM 101, isn't it? Focus on the process and not the person? Put a well documented process in place and work with the team to become process minded so that they begin to refine and improve all processes? I think this is a start, but in astartup where capital is constrained and time is even more precious how do you balance the two? Pick critical processes and focus ONLY on them. Get them right first and then expand. In our business there are probably 3 processes that really matter. How supplies are ordered is not one of them (right now). Managing administrative paperwork and insurance approvals is certainly one of the top. Much of the time, we use people and personalities to solve problems (ie "assign John to ____, he is good at solving those kinds of problems); but people and personalities change from day to day and the underlying process is still broken or does not exist at all. The other compounding issue is to throw technology at it....that solves everything! All it really does is take a complicated problem and make it more complex. I have seen many small practices that are marginally profitable pursue technology as the holy grail, only to waste money and never get it fully implemented. Again treating symptoms....
This week I am going to go sit in the practice and document what they do. From many preliminary conversations about process it is evident that most folks think they have a standard way they do things but the reality is greatly different that what they think. One of my favorite tools is visual mapping. Try and visually map the process and then provide markers within the business to "see" it in action. This might include color coded bins (kan bans), whiteboards that track results, etc.
One of my personal challenges will be to avoid helicoptering in to solve the problem, rather trying to provide the environment for the team to see their issues and create solutions. My goal is to ask the executive team a couple of simple questions when an issue arises -- what is the process? Is it repeatable? Can you measure the outcome. Much of what we do at the executive level would fail these tests.....
More as we get into the "mapping".
This is TQM 101, isn't it? Focus on the process and not the person? Put a well documented process in place and work with the team to become process minded so that they begin to refine and improve all processes? I think this is a start, but in astartup where capital is constrained and time is even more precious how do you balance the two? Pick critical processes and focus ONLY on them. Get them right first and then expand. In our business there are probably 3 processes that really matter. How supplies are ordered is not one of them (right now). Managing administrative paperwork and insurance approvals is certainly one of the top. Much of the time, we use people and personalities to solve problems (ie "assign John to ____, he is good at solving those kinds of problems); but people and personalities change from day to day and the underlying process is still broken or does not exist at all. The other compounding issue is to throw technology at it....that solves everything! All it really does is take a complicated problem and make it more complex. I have seen many small practices that are marginally profitable pursue technology as the holy grail, only to waste money and never get it fully implemented. Again treating symptoms....
This week I am going to go sit in the practice and document what they do. From many preliminary conversations about process it is evident that most folks think they have a standard way they do things but the reality is greatly different that what they think. One of my favorite tools is visual mapping. Try and visually map the process and then provide markers within the business to "see" it in action. This might include color coded bins (kan bans), whiteboards that track results, etc.
One of my personal challenges will be to avoid helicoptering in to solve the problem, rather trying to provide the environment for the team to see their issues and create solutions. My goal is to ask the executive team a couple of simple questions when an issue arises -- what is the process? Is it repeatable? Can you measure the outcome. Much of what we do at the executive level would fail these tests.....
More as we get into the "mapping".
Thursday, October 9, 2008
You Get Only One Slide -- Make it GREAT
I am preparing for an investor pitch and reviewing a ton of slides and materials. We have passed through the initial screens with the group and they like what they see, so this is a very important meeting. As I was thinking about the flow of the presentation I asked myself if I had only one slide, what would it be? This is a pretty powerful question....think about it, one slide for all the marbles. All the clutter and fluff was instantly cut away.....I could talk for hours about one slide and it would generate the necessary emotion and dynamic conversation needed to make our point. The slide is a picture, no words, just a before and after kinda thing. It quickly sums up the opportunity, the inherent economics and the overall opportunity for impact, payback and success! Pretty cool
Try it sometime it will provide clarity.
Try it sometime it will provide clarity.
Wednesday, October 8, 2008
OK, so I have waited a long time to post and now and loaded for bear. The financial meltdown really has me going....two major things come to mind.
First, since when did comprise (giving up something for the common good) mean willingness to buy votes (or require a payment to support something)? This seems to be the common practice in DC as witnessed by the pork added to the bailout bill....shameless.
Second, why are the debates so focused on "tax breaks"....doesn't that force a bigger question of "if a tax break is required, why are we spending so much, or better what are we spending funds on, or even better what is the purpose of the government?" Let's have that discussion first!
Other items I want to discuss and will get to....
First, since when did comprise (giving up something for the common good) mean willingness to buy votes (or require a payment to support something)? This seems to be the common practice in DC as witnessed by the pork added to the bailout bill....shameless.
Second, why are the debates so focused on "tax breaks"....doesn't that force a bigger question of "if a tax break is required, why are we spending so much, or better what are we spending funds on, or even better what is the purpose of the government?" Let's have that discussion first!
Other items I want to discuss and will get to....
- Friedman's "The World is Flat"
- Scripting language
- Parent's weekend at CofC
Friday, June 13, 2008
Catching Up
Met with a good friend and past colleague this week and it was good catching up. Robert Pease worked for me for a brief time in the heady days of the Internet boom. He has subsequently gone on to a successful career in software product management in Seattle. We caught up on several topics, and the discussion jarred my memory on several well discussed topics.....here's a brief list with some reflections.
Software industry -- There are MANY small software companies that really never make it mainly due to their hopes being dashed on the rocks of enterprise sales. Even for established companies, selling to the enterprise is not easy, takes a very long time and mostly is not possible if your name is not IBM, Microsoft or _______.
Success -- As as software entrepreneur you are never really out of the woods. Raising money does not equal creating value. Creating value (ie making REAL money) is sustained success.
"Small business" is really about $30M in revenue which is NOT a small business as it relates to MOST small business in the US. It is impossible, nearly, to apply technology to a small business (revenues less than $5M). I would love to have a work flow solution, VOIP (real VOIP), SharePoint, Exchange, etc. These technologies could make a huge impact on our bottom line. Cant' afford them! We are a Google Aps company and love it, but we need more to compete.
More on these and others later.
Software industry -- There are MANY small software companies that really never make it mainly due to their hopes being dashed on the rocks of enterprise sales. Even for established companies, selling to the enterprise is not easy, takes a very long time and mostly is not possible if your name is not IBM, Microsoft or _______.
Success -- As as software entrepreneur you are never really out of the woods. Raising money does not equal creating value. Creating value (ie making REAL money) is sustained success.
"Small business" is really about $30M in revenue which is NOT a small business as it relates to MOST small business in the US. It is impossible, nearly, to apply technology to a small business (revenues less than $5M). I would love to have a work flow solution, VOIP (real VOIP), SharePoint, Exchange, etc. These technologies could make a huge impact on our bottom line. Cant' afford them! We are a Google Aps company and love it, but we need more to compete.
More on these and others later.
Tuesday, April 15, 2008
Hiring and the Startup Fit
I have been ruminating on this post for several days, if not weeks or months. Borne out of experience and frustration, the question is this -- "are certain people more cutout for startups or small businesses than others?" The immediate and obvious answer is yes, but the subtleties and practicalities of the implementation are vastly complex and difficult.
Today, we use a "personality profile" (www.internalchange.com) and it provides and excellent overview of the person, but it does not measure that personality against the small business/startup culture/organization. As my partner says, the profile indicates who MIGHT be a bad fit, but it does not say who will be a top performer. We also do an exhaustive interview, even for entry level positions. We have found that attitude and outlook can greatly shape the success that person experiences on the job AND those attributes are infectious. The old "one bad apple" rule that grandma espoused applies!
The other piece to this question is, are startups and small businesses relatively the same in terms of organization and culture. In other words, are the demands of these types of businesses close enough to call them the same. After having done a couple of startups and now in a small business (startup?) I would say the answer is mostly yes. The major difference being the small business I am associated with today lacks the engineering perspective which creates a whole set of new demands and challenges.
What I look for is someone who can live in an ambiguous world where their job is not prescribed from the time they hit the door to when they leave. Of course, there are positions that are very transactional (ie AP clerk), but for the key hires, this is not possible.
In a past life, the best hires were those that had spent three years at consulting firms coming out of business school. Why? One of the MBA's greatest skills learned is how to graduate while doing only 20% of the work. In other words, business school refines and hones the skills of choosing what work NOT to be done in order to be successful. And because as consultants they are trained to never say "I don't know", "that's not my job" or "no". By definition, consultants don't know, but they always find out and become the experts in a very short period of time. They are good at managing time and projects (or they get fired). And they are not troubled by ambiguity! To me, in a startup, this is the type of person you must hire and form a corp around. Give me a hand full of these types and I can beat the pants of the "experts" almost every time.
Today, we use a "personality profile" (www.internalchange.com) and it provides and excellent overview of the person, but it does not measure that personality against the small business/startup culture/organization. As my partner says, the profile indicates who MIGHT be a bad fit, but it does not say who will be a top performer. We also do an exhaustive interview, even for entry level positions. We have found that attitude and outlook can greatly shape the success that person experiences on the job AND those attributes are infectious. The old "one bad apple" rule that grandma espoused applies!
The other piece to this question is, are startups and small businesses relatively the same in terms of organization and culture. In other words, are the demands of these types of businesses close enough to call them the same. After having done a couple of startups and now in a small business (startup?) I would say the answer is mostly yes. The major difference being the small business I am associated with today lacks the engineering perspective which creates a whole set of new demands and challenges.
What I look for is someone who can live in an ambiguous world where their job is not prescribed from the time they hit the door to when they leave. Of course, there are positions that are very transactional (ie AP clerk), but for the key hires, this is not possible.
In a past life, the best hires were those that had spent three years at consulting firms coming out of business school. Why? One of the MBA's greatest skills learned is how to graduate while doing only 20% of the work. In other words, business school refines and hones the skills of choosing what work NOT to be done in order to be successful. And because as consultants they are trained to never say "I don't know", "that's not my job" or "no". By definition, consultants don't know, but they always find out and become the experts in a very short period of time. They are good at managing time and projects (or they get fired). And they are not troubled by ambiguity! To me, in a startup, this is the type of person you must hire and form a corp around. Give me a hand full of these types and I can beat the pants of the "experts" almost every time.
Tuesday, April 1, 2008
Reader
http://www.google.com/reader/m/view/?hl=en&i=-4132294479772972031&c=CI2W0fy8upIC&n=1
Jim Clifton
Chief Operating Officer
BridgePoint Medical
jclifton@bp-medical.com
Venture Hack
This site --> (http://venturehacks.com/) is what forced me to create a blog....mainly to comment on the stuff I find and pass along. See shared feeds on the right.
By far and away this is the single best site for anyone who is raising money and ofter wonders "who cares about my position"? Answer -- no one. So here's a site that you can use to protect your position as a founder and more importantly, protect your future position (ie look 3-4 moves out and position your foundation for a profitable exit).
By far and away this is the single best site for anyone who is raising money and ofter wonders "who cares about my position"? Answer -- no one. So here's a site that you can use to protect your position as a founder and more importantly, protect your future position (ie look 3-4 moves out and position your foundation for a profitable exit).
Intro
This is really a place for me to bookmark things I find while perusing the net via Google Reader. My shared items will appear in the widget on the right and occasional comments will be added here in the posts.
Topics will cover:
1) VC -- mostly from the entrepreneur's perspective...
2) Startups -- challenged faced by entrepreneurs and any resources out there that make it easier....
3) Sports (SEC football and UK basketball)
4) Sending kids to college (daughter is on her way next year)
5) Digital photography
6) Leadership and change mgmt -- two topics we deal with in our current business
7) Healthcare, specifically prosthetics and orthotics -- our latest venture is a rollup in the O&P space
JC
Topics will cover:
1) VC -- mostly from the entrepreneur's perspective...
2) Startups -- challenged faced by entrepreneurs and any resources out there that make it easier....
3) Sports (SEC football and UK basketball)
4) Sending kids to college (daughter is on her way next year)
5) Digital photography
6) Leadership and change mgmt -- two topics we deal with in our current business
7) Healthcare, specifically prosthetics and orthotics -- our latest venture is a rollup in the O&P space
JC
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