Back in the 1990's I was Head of Operations for a niche upmarket Tour Operator, Simply Travel. It was a great company. We provided quality and authentic accommodation in some of the most beautiful destinations in Europe, we provided the best possible service. We sold the business to Thomson Travel in 1999 and in 2000 I moved to an online travel start up during the dotcom boom.
I mention this because I'd like to thank Steve Rushton (@stevemrushton), our Managing Director at the time for some sage advice.
I was busy, flat out. As I like to get things done well, I was worried that I was not completing everything I wanted to. Not enough i's were dotted or t's were crossed. My to do list was never ending. Steve said that if I had too much work, it wasn't important to finish everything, it is more important to finish the most important work first. He said something like, "If you have enough work to fill 150% of your time, make sure you choose the most important 100%".
A few years later I was at Expedia. I was with Dermot Halpin and we were talking about strategy. Dermot emphasised that it's not what you choose to do that defines your strategy, it's what you decide not to do. If you are not saying no, you don't have a strategy.
On the same theme, I came across this really helpful post today "A VC's 10 startup secrets he wishes he had known as an entrepreneur". It's by Micheal Skok (@mjskok), a VC at North Bridge.
The ten tips he goes on to list are very relevant but I'd like to highlight one in particular that all of us can learn from, in business and in life. He calls it "Don’t be afraid to say “no” more than “yes.”".
So often in life we want to say yes. Opportunities are around every corner. It's important to grasp these opportunities. However, if you are lucky enough to have more opportunities than time, what will define you is what you say no to, not what you say yes to.
Showing posts with label decision making. Show all posts
Showing posts with label decision making. Show all posts
Friday, 17 January 2014
Wednesday, 9 March 2011
If You Knew You Couldn't Fail, What Would You Do?
Have you ever seen a baby learning to walk? Of course you have. Now, tell me how they do it.
I'm lucky to have four kids. I didn't teach them to walk. They didn't teach each other. They just got up and had a go. First of all they started to figure out how to pull themselves up to stand against the furniture. Then they made one or two steps. A few weeks later and they were walking.
We all first learnt by trial and error.
Later in childhood, we start to learn from others. We are taught. We go to school. It's quite amazing to have my eldest daughter read a book to me. She's six. 6 months ago she couldn't read.
We are taught.
There's a third phase. Once we know how things work, we can go figure things out for ourselves. Some kids spend hours playing tennis, some spend hours programming, others spend hours and hours making things. Some of these kids will become the best in the world at what they do. Literally the best in the world. In this phase we practice. We seek guidance, we practice some more. We put hours and hours in. We make mistakes and learn from them. We practice some more.
We are self-taught and we practice.
But then - we become adults. Some people continue with trial and error (It's called 'learning on the job' in the business world. Some are taught (it's called 'training' in the business world). Some practice, work long hard hours, push themselves and become the best in the world at what they do. I'm not sure what we call these people, but I admire them.
I am more thirsty for knowledge now than I have ever been in my life. The more I learn the more I realise there is to learn. And I want to be the best in the world at what I do. Why? It's simple. There's very little in life that beats the feeling that you get when you say 'today I did what I do best!'
Today I will do what I do best. Will you?
Imagine a team where every person can say that. Can you imagine what that team would be able to achieve? It would be extraordinary. World beating. In fact just writing this makes my hairs stand on end - it really is something special. It's like watching the Oxford Cambridge Boat Race and seeing the winners win. It's awesome.
The thing about great teams is, 1 plus 1 equals 3. The sum of the parts is greater than the whole. Only it's not guaranteed. Sometimes two egotistical geniuses equal less than two because they haven't figured how to collaborate well.
So - on a practical note then, how do we build great teams where every person does what they do best and on top of that build a winning team?
How do we make that team possible?
Here, I think are the 5 main ingredients;
1. Allow people to make mistakes.
If we make more mistakes, we learn more. I'm not saying that we should aim to fail. Rather we should always be 'doing'. Doing something means you have the opportunity to learn. If you don't do anything you won't make any mistakes, but then again you won't learn anything. This is the thinking behind the phrase 'fail faster'. It's not that you should aim to fail - instead, you should 'do more faster' - because that's how you'll learn.
Fear holds us back though. We are afraid to make mistakes in case it's not seen as successful by our peers and egos.
My wife and I were talking the other day about why she is successful at what she does. She does business development for a recruitment firm and she needs to figure out how to book meetings with HR Managers and then persuade them to use her firm's services. She said that you can't book meetings without making phone calls, so she has to be very persistent to keep calling until she gets the meeting. She will keep calling way long after other people have given up. Most people fear the rejection, whereas she doesn't.
Her motto is "if you knew you wouldn't fail, what would you do?" Great advice indeed.
So - as a manager, I will always say to my team, 'make decisions and do stuff. Better to do lots and be right 95% of the time than to do a little and be right 100% of the time'. You'll learn faster and so will I.
2. Trust your colleagues and help them to learn from their mistakes
You can only truly build a successful team if there is true openness. I need to be open with my intentions, emotions and reasoning. By doing so, my colleagues can help me identify what I'm doing well and what I can do better and I will learn faster. If I do this though I am opening myself up. I am doing exactly the opposite of what most people do in business. It needs mutual trust, respect and willing - and it needs to start at the top.
3. Design learning structures
A great example of this is how we used to run our software development cycles in one of my previous companies. We planned our work in two week cycles. This was pretty effective in terms of getting things done. The important ingredient I think that actually made it successful was that after every cycle ('sprint') we set up a 'retrospective meeting'. This was a simple meeting where we simply asked, 'what went well, what didn't go so well and how will we in future do more of the good stuff and less of the bad stuff?' Doing this systematically requires a regular meeting slot in the diary, an agenda and a habit. It requires structure.
Good teams consciously create these structures to become learning teams.
4. Hire people that can handle this culture
This is critical. If you believe that you want to build world class winning teams you need to hire accordingly. Sure you need talent and experience. I say they're over-rated.
Just because someone has knowledge and ingredients to make a great cake it doesn't mean that they will. And just because someone was motivated to bake great cakes in the past doesn't mean that they will do so again in a different kitchen.
What really matters is
- does this person know how to apply themselves to a challenge?
- is this person willing to open themselves up and be fully transparent with their emotions, reasoning and intentions?
- are they able to give feedback to others in a helpful way?
- are they thirsty to be the best in the world at something?
5. Go with the flow
You cannot tell people what motivates them. In my experience, people do best what they are interested in, not necessarily what they are good at. I might be quite good at filing and organising paperwork, it doesn't mean I'm interested in it. Give me a reason to be interested in it or find me something to do that I am interested in and I will do it well. Really well.
So - as people develop in your team, find opportunities for them and help them where possible to grow in your organisation to do what they do best. Build the team around the capabilities you have and seek out new team members to fill the gaps if they exist (and make sure you follow the points in point 4).
To conclude
Great parent allow their children to make mistakes, they teach them all they can, and they give them wings to fly and pursue their own dreams.
In a team, we must think of ourselves as parents of each other.
And every day, if we strive to be the best we can be in what we do we'll need to push ourselves to the limit and make a few mistakes. It's the mistakes that lead us to truth.
Benjamin Franklin once wrote,
'Perhaps the history of the errors of mankind, all things considered, is more valuable and interesting than that of their discoveries. Truth is uniform and narrow; it does not seem to require so much an active energy, as a passive aptitude of soul in order to encounter it. But error is endlessly diversified'
Fail faster. Act like a child and a parent at the same time. Be the best in the world at something every day.
I'm lucky to have four kids. I didn't teach them to walk. They didn't teach each other. They just got up and had a go. First of all they started to figure out how to pull themselves up to stand against the furniture. Then they made one or two steps. A few weeks later and they were walking.
We all first learnt by trial and error.
Later in childhood, we start to learn from others. We are taught. We go to school. It's quite amazing to have my eldest daughter read a book to me. She's six. 6 months ago she couldn't read.
We are taught.
There's a third phase. Once we know how things work, we can go figure things out for ourselves. Some kids spend hours playing tennis, some spend hours programming, others spend hours and hours making things. Some of these kids will become the best in the world at what they do. Literally the best in the world. In this phase we practice. We seek guidance, we practice some more. We put hours and hours in. We make mistakes and learn from them. We practice some more.
We are self-taught and we practice.
But then - we become adults. Some people continue with trial and error (It's called 'learning on the job' in the business world. Some are taught (it's called 'training' in the business world). Some practice, work long hard hours, push themselves and become the best in the world at what they do. I'm not sure what we call these people, but I admire them.
I am more thirsty for knowledge now than I have ever been in my life. The more I learn the more I realise there is to learn. And I want to be the best in the world at what I do. Why? It's simple. There's very little in life that beats the feeling that you get when you say 'today I did what I do best!'
Today I will do what I do best. Will you?
Imagine a team where every person can say that. Can you imagine what that team would be able to achieve? It would be extraordinary. World beating. In fact just writing this makes my hairs stand on end - it really is something special. It's like watching the Oxford Cambridge Boat Race and seeing the winners win. It's awesome.
The thing about great teams is, 1 plus 1 equals 3. The sum of the parts is greater than the whole. Only it's not guaranteed. Sometimes two egotistical geniuses equal less than two because they haven't figured how to collaborate well.
So - on a practical note then, how do we build great teams where every person does what they do best and on top of that build a winning team?
How do we make that team possible?
Here, I think are the 5 main ingredients;
1. Allow people to make mistakes.
If we make more mistakes, we learn more. I'm not saying that we should aim to fail. Rather we should always be 'doing'. Doing something means you have the opportunity to learn. If you don't do anything you won't make any mistakes, but then again you won't learn anything. This is the thinking behind the phrase 'fail faster'. It's not that you should aim to fail - instead, you should 'do more faster' - because that's how you'll learn.
Fear holds us back though. We are afraid to make mistakes in case it's not seen as successful by our peers and egos.
My wife and I were talking the other day about why she is successful at what she does. She does business development for a recruitment firm and she needs to figure out how to book meetings with HR Managers and then persuade them to use her firm's services. She said that you can't book meetings without making phone calls, so she has to be very persistent to keep calling until she gets the meeting. She will keep calling way long after other people have given up. Most people fear the rejection, whereas she doesn't.
Her motto is "if you knew you wouldn't fail, what would you do?" Great advice indeed.
So - as a manager, I will always say to my team, 'make decisions and do stuff. Better to do lots and be right 95% of the time than to do a little and be right 100% of the time'. You'll learn faster and so will I.
2. Trust your colleagues and help them to learn from their mistakes
You can only truly build a successful team if there is true openness. I need to be open with my intentions, emotions and reasoning. By doing so, my colleagues can help me identify what I'm doing well and what I can do better and I will learn faster. If I do this though I am opening myself up. I am doing exactly the opposite of what most people do in business. It needs mutual trust, respect and willing - and it needs to start at the top.
3. Design learning structures
A great example of this is how we used to run our software development cycles in one of my previous companies. We planned our work in two week cycles. This was pretty effective in terms of getting things done. The important ingredient I think that actually made it successful was that after every cycle ('sprint') we set up a 'retrospective meeting'. This was a simple meeting where we simply asked, 'what went well, what didn't go so well and how will we in future do more of the good stuff and less of the bad stuff?' Doing this systematically requires a regular meeting slot in the diary, an agenda and a habit. It requires structure.
Good teams consciously create these structures to become learning teams.
4. Hire people that can handle this culture
This is critical. If you believe that you want to build world class winning teams you need to hire accordingly. Sure you need talent and experience. I say they're over-rated.
Just because someone has knowledge and ingredients to make a great cake it doesn't mean that they will. And just because someone was motivated to bake great cakes in the past doesn't mean that they will do so again in a different kitchen.
What really matters is
- does this person know how to apply themselves to a challenge?
- is this person willing to open themselves up and be fully transparent with their emotions, reasoning and intentions?
- are they able to give feedback to others in a helpful way?
- are they thirsty to be the best in the world at something?
5. Go with the flow
You cannot tell people what motivates them. In my experience, people do best what they are interested in, not necessarily what they are good at. I might be quite good at filing and organising paperwork, it doesn't mean I'm interested in it. Give me a reason to be interested in it or find me something to do that I am interested in and I will do it well. Really well.
So - as people develop in your team, find opportunities for them and help them where possible to grow in your organisation to do what they do best. Build the team around the capabilities you have and seek out new team members to fill the gaps if they exist (and make sure you follow the points in point 4).
To conclude
Great parent allow their children to make mistakes, they teach them all they can, and they give them wings to fly and pursue their own dreams.
In a team, we must think of ourselves as parents of each other.
And every day, if we strive to be the best we can be in what we do we'll need to push ourselves to the limit and make a few mistakes. It's the mistakes that lead us to truth.
Benjamin Franklin once wrote,
'Perhaps the history of the errors of mankind, all things considered, is more valuable and interesting than that of their discoveries. Truth is uniform and narrow; it does not seem to require so much an active energy, as a passive aptitude of soul in order to encounter it. But error is endlessly diversified'
Fail faster. Act like a child and a parent at the same time. Be the best in the world at something every day.
Tuesday, 19 October 2010
Get Your Platform Shoes On
Finding a business model that scales is increasingly important in the modern world.
What does that mean, and how do we do it?
First of all, scaling. I'm using scaling in the broadest sense. In my definition, it's a case of where revenues per unit grow faster than cost per unit. An example would be; say I need 2 programmers and 3 web servers to make 1,000 online sales a day. If I do 10 times as many sales, I don't want to spend 10 times as much on programmers and servers. So instead of 20 programmers and 30 servers, maybe I can do it with 3 programmers and 4 web servers. The cost of doing business gets more efficient the more volume I add.
This is a particularly important concept for tech-media companies, because often in a start-up mode they are running at a loss. They are still investable businesses though because if the sales and marketing bring the volumes, not only do you get to a point where the company starts to break even, but the growth in profitability thereafter is extremely impressive.
Secondly, the modern world. Increasingly we are seeing business models that transcend borders. They can be run primarily from one central location with small local teams for international presence. Not just in tech (Google, Facebook, Amazon, eBay), but also in telephony (Vodafone, Orange, Nokia, HTC), consumer electronics (Sony, Samsung, Apple) and supermarkets (Wal-Mart/Asda, Carrefour, Tesco). A business model that scales has a huge advantage over one that doesn't when competing on world stage.
So, if scale is important to compete in the modern world, how should we think about business investments into this environment?
I always ask myself, "is this a platform business?"
If the answer is yes, I'm interested. If no, you'll need to work hard to get my interest.
A platform. Not 1970's funky shoes, but a prism through which to view to judge almost any business investment.
A platform is a place where supply and demand are aggregated. Lots of buyers connect to lots of sellers through a central marketplace or hub.
There are platforms all around you.
iTunes: Hundreds of millions of music consumers connected to almost every music publisher
Google: Millions of searchers connected to millions of advertisers
eBay: Millions of private sellers connected to millions of buyers
And there's more... Autotrader, Match.com, Amazon - and of course Livebookings (my day job) - where we connect millions of diners to thousands of restaurants.
These are all platforms. The more supply you add, the more interesting you are to buyers. The more buyers you can provide access to (consumers), the more interesting you are to sellers. You gain market power - because the owner of the marketplace can charge people for attending the marketplace and for transactions that happen in the marketplace.
In any business model like this, the potential is exciting. The keys to success are; seeding the platform with sufficient product to get consumers interested, have a diminishing cost of sale by adding more inventory over time and having inherent viral effects that customers create more customers. That's all about execution. Having a great idea is one thing - doing it is always harder.
To get past that "is this a good idea?" phase, I always ask myself, "does this solve a real need", "is this a platform" and "will it scale?".
What does that mean, and how do we do it?
First of all, scaling. I'm using scaling in the broadest sense. In my definition, it's a case of where revenues per unit grow faster than cost per unit. An example would be; say I need 2 programmers and 3 web servers to make 1,000 online sales a day. If I do 10 times as many sales, I don't want to spend 10 times as much on programmers and servers. So instead of 20 programmers and 30 servers, maybe I can do it with 3 programmers and 4 web servers. The cost of doing business gets more efficient the more volume I add.
This is a particularly important concept for tech-media companies, because often in a start-up mode they are running at a loss. They are still investable businesses though because if the sales and marketing bring the volumes, not only do you get to a point where the company starts to break even, but the growth in profitability thereafter is extremely impressive.
Secondly, the modern world. Increasingly we are seeing business models that transcend borders. They can be run primarily from one central location with small local teams for international presence. Not just in tech (Google, Facebook, Amazon, eBay), but also in telephony (Vodafone, Orange, Nokia, HTC), consumer electronics (Sony, Samsung, Apple) and supermarkets (Wal-Mart/Asda, Carrefour, Tesco). A business model that scales has a huge advantage over one that doesn't when competing on world stage.
So, if scale is important to compete in the modern world, how should we think about business investments into this environment?
I always ask myself, "is this a platform business?"
If the answer is yes, I'm interested. If no, you'll need to work hard to get my interest.
A platform. Not 1970's funky shoes, but a prism through which to view to judge almost any business investment.
A platform is a place where supply and demand are aggregated. Lots of buyers connect to lots of sellers through a central marketplace or hub.
There are platforms all around you.
iTunes: Hundreds of millions of music consumers connected to almost every music publisher
Google: Millions of searchers connected to millions of advertisers
eBay: Millions of private sellers connected to millions of buyers
And there's more... Autotrader, Match.com, Amazon - and of course Livebookings (my day job) - where we connect millions of diners to thousands of restaurants.
These are all platforms. The more supply you add, the more interesting you are to buyers. The more buyers you can provide access to (consumers), the more interesting you are to sellers. You gain market power - because the owner of the marketplace can charge people for attending the marketplace and for transactions that happen in the marketplace.
In any business model like this, the potential is exciting. The keys to success are; seeding the platform with sufficient product to get consumers interested, have a diminishing cost of sale by adding more inventory over time and having inherent viral effects that customers create more customers. That's all about execution. Having a great idea is one thing - doing it is always harder.
To get past that "is this a good idea?" phase, I always ask myself, "does this solve a real need", "is this a platform" and "will it scale?".
Then - I get my platform shoes on - and go for a boogie.
Saturday, 12 June 2010
The Economics of Happiness
What's the best use of your money? Would you buy a coffee for £2 from a coffee shop, or buy a teapot for £1 from a road-side stall?
My wife and I were on holiday with the kids recently in a seaside town in Cornwall. After a lovely afternoon at the beach we were walking back to our rented house and we saw a table outside a house with some second hand goods for sale. No-one was at the stand, not even the owner, and there was an honesty box for purchases.
My wife spotted a white porcelain teapot. Plain, white. A teapot. She said, "I really like this, let's get it, it's only £1". I said "A teapot, what do you want a teapot for? We don't even drink tea, and if we give it to visitors we already have a silver teapot we can use".
"I like it - okay?! It's only £1, what's it to you? It will look lovely on the shelf in the new kitchen". I don't know why, but I still resisted. I just hated the idea of owning another object that would need to be moved, cleaned. Perhaps I have a less is more approach to belongings - the more stuff you have, the bigger burden it creates on maintaining that stuff, and it can actually be a cause of unhappiness. That's why I didn't see the point of a £1 teapot that we would never use. It wasn't the cost, it was the space.
My wife said, "I don't complain when you buy a £2 cup of coffee!" (It's true, I like coffee, and I buy one or two a day - that's quite an expensive habit - maybe smoking would be cheaper.) "So why are you kicking up a fuss about a £1 teapot?"
At this point I figured that it was a good time to just lie down and buy the teapot. I realised that it would give her some degree of happiness and that an argument wouldn't help either of us. Mental trade-off made, we bought the teapot.
It did get me thinking though. If you have a choice, is it better to spend your money on things or experiences? Or - give your money away? It seems to me that good experiences mature like good wine. They get better and better in our memories because we filter out the worst bits. Things/objects on the other hand rarely get better, they get worse. They deteriorate, they need repairing. Something better soon comes along and our joy on the thing that was "new" fades quickly. We get used to things and want more. Then - they need disposing of.
Experiences it seems are an investment - they mature. Things on the other hand are like throwing money away. The only alteration to this principle that makes sense to me concerns things that are bought in order to enjoy experiences. Skis, bikes and boats come into this category for me.
I had a lovely coffee that morning on holiday, sitting on the harbour wall and soaking up the atmosphere. In many ways it was one highlight of my holiday. I wonder how my £2 investment will pay off against the £1 teapot? Time will tell.
My wife and I were on holiday with the kids recently in a seaside town in Cornwall. After a lovely afternoon at the beach we were walking back to our rented house and we saw a table outside a house with some second hand goods for sale. No-one was at the stand, not even the owner, and there was an honesty box for purchases.
My wife spotted a white porcelain teapot. Plain, white. A teapot. She said, "I really like this, let's get it, it's only £1". I said "A teapot, what do you want a teapot for? We don't even drink tea, and if we give it to visitors we already have a silver teapot we can use".
"I like it - okay?! It's only £1, what's it to you? It will look lovely on the shelf in the new kitchen". I don't know why, but I still resisted. I just hated the idea of owning another object that would need to be moved, cleaned. Perhaps I have a less is more approach to belongings - the more stuff you have, the bigger burden it creates on maintaining that stuff, and it can actually be a cause of unhappiness. That's why I didn't see the point of a £1 teapot that we would never use. It wasn't the cost, it was the space.
My wife said, "I don't complain when you buy a £2 cup of coffee!" (It's true, I like coffee, and I buy one or two a day - that's quite an expensive habit - maybe smoking would be cheaper.) "So why are you kicking up a fuss about a £1 teapot?"
At this point I figured that it was a good time to just lie down and buy the teapot. I realised that it would give her some degree of happiness and that an argument wouldn't help either of us. Mental trade-off made, we bought the teapot.
It did get me thinking though. If you have a choice, is it better to spend your money on things or experiences? Or - give your money away? It seems to me that good experiences mature like good wine. They get better and better in our memories because we filter out the worst bits. Things/objects on the other hand rarely get better, they get worse. They deteriorate, they need repairing. Something better soon comes along and our joy on the thing that was "new" fades quickly. We get used to things and want more. Then - they need disposing of.
Experiences it seems are an investment - they mature. Things on the other hand are like throwing money away. The only alteration to this principle that makes sense to me concerns things that are bought in order to enjoy experiences. Skis, bikes and boats come into this category for me.
I had a lovely coffee that morning on holiday, sitting on the harbour wall and soaking up the atmosphere. In many ways it was one highlight of my holiday. I wonder how my £2 investment will pay off against the £1 teapot? Time will tell.
Tuesday, 2 October 2007
Making a Decision Without All The Data
"You don't need a weatherman to see which way the wind is blowing" - Bob Dylan
I heard this on my ipod the other day and it got me thinking. In business you can often get to "analysis paralysis". By this I mean where leaders only make decisions when they have a full set of data, a fully developed business model, risk assessment models, etc etc.
In many cases making decisions on a well research data set is the right thing to do.
Yet there comes a point where gathering more information is not going to get give you significantly more insight.
Example: for usability testing, Jakob Neilson has shown that it only takes five users to give you enough information to work from. See his article Why You Only Need to Test With 5 Users. Five users can identify 80% of the usability problems. To get 100%, you need to test 15 users. You can get working quicker on resolving the issues if you just test 5, fix them, and then re-test.
Going back to Bob Dylan. The point is this... you can't predict the weather without specific data, but you can predict the seasons. Summer always follows spring, and it's usually warmer. You know this from your experience. Your experience feeds your intuition.
The role of your experience in decision making is considered in more detail by Malcolm Gladwell in his book "Blink". See my recommended reading post for more details.
If you have experience in an area, sometimes you just need to take a view and go with it. You'll probably be right.
I heard this on my ipod the other day and it got me thinking. In business you can often get to "analysis paralysis". By this I mean where leaders only make decisions when they have a full set of data, a fully developed business model, risk assessment models, etc etc.
In many cases making decisions on a well research data set is the right thing to do.
Yet there comes a point where gathering more information is not going to get give you significantly more insight.
Example: for usability testing, Jakob Neilson has shown that it only takes five users to give you enough information to work from. See his article Why You Only Need to Test With 5 Users. Five users can identify 80% of the usability problems. To get 100%, you need to test 15 users. You can get working quicker on resolving the issues if you just test 5, fix them, and then re-test.
Going back to Bob Dylan. The point is this... you can't predict the weather without specific data, but you can predict the seasons. Summer always follows spring, and it's usually warmer. You know this from your experience. Your experience feeds your intuition.
The role of your experience in decision making is considered in more detail by Malcolm Gladwell in his book "Blink". See my recommended reading post for more details.
If you have experience in an area, sometimes you just need to take a view and go with it. You'll probably be right.
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