Saturday, July 20, 2019

8 Self-Check Questions That Keep Leaders Up At Night

Leader-awake-at-nightEven entrepreneurs who have built many startups, or sold their last one for millions of dollars, know they make occasional people leadership mistakes. They know leadership is all about managing their own complicated, illogical, and fallible human foibles, as well as the people they depend on. These can trip up even the best, often at the cost of more than a good night’s sleep.

Thankfully, most mistakes won’t be as spectacular as the America Online merger with Time Warner for $350 billion, back in 2000, engineered by then superstar entrepreneurs Stephen M. Case and Gerald M. Levin. They apparently ignored all conventional wisdom and advisors, and struck a deal which crashed both companies, now a case study in many business schools.

By most accounts, this case exhibits almost all the lapses identified in a classic book by Dr. Nicole Lipkin, “What Keeps Leaders Up At Night.” She provides some great guidance, based on coaching experience and a doctorate in clinical psychology, on recognizing and resolving the most troubling management issues for leaders in all stages of an organization:

  1. I’m a good leader. So why do I sometimes act like a bad one? According to the evidence, good bosses go bad (temporarily versus the chronically horrible), for three overarching reasons – too busy to win, to proud to see, or too afraid to lose. Every leader needs to check and enhance his self-awareness to recognize and avoid these.
  1. Why don’t people heed my sage advice? Many people use the terms influence, persuasion, and manipulation interchangeably. But each carries its own specific meaning. Influence requires winning minds and hearts to inspire action. Persuasion intellectually stimulates a person to action. Manipulation is seen as insincerity, and it gets non-action.
  1. Why do I lose my cool in hot situations? Stress comes in two distinct forms: good stress and bad stress (distress). Managed effectively, stress is a good thing, leading to survival. But chronic stress and distress results in overreaction to non-life-threatening events. Schedule an on-going reality check with trusted advisors to know the difference.
  1. Why does a good fight sometimes go bad? A good fight in business is called healthy competition. Unfortunately, feelings of envy and inferiority can quickly turn healthy competition into a knock-down, drag-out fight between people and companies, turning a win-win situation into a lose-lose one. Check all your emotions at the gate.
  1. Why can ambition sabotage success? Every leader needs to balance ambition with humility, restrain one’s ego, treat others with respect, create positive impressions, and adopt a long-term perspective of success. Don’t let a “nearsighted” view cloud the “big-picture” view; success in the best interests of all. Contemplate your legacy to others.
  1. Why do people resist change? The brain’s hard wiring pre-disposes us to habitual behavior and decision making. We let biases influence our reaction to change and our ability to make decisions that cause change. To thrive you need to become more aware of biases and psychology behind your own and your people’s responses to change.
  1. Why do good teams go bad? Humans have always affiliated with groups and teams in order to survive and thrive. Group dynamics are not always good, including “us” versus “them” mentality, group conformity, social loafing, and emotional contagion. Leaders need to manage these dynamics to keep from falling prey to negative group behaviors.
  1. What causes a star to fade? When start performers fade, it’s almost always a failure to remain engaged with the people and the job. Smart leaders must constantly monitor the four essential elements of engagement: social connection, leadership excellence, aligned culture, and meaningful work and life. Engagement drives performance and satisfaction.

These questions should all be contemplated and understood by every entrepreneur and startup founder, starting on day one of their quest. Remember, we are all human, and we will make mistakes. The challenge is to learn from these, and just as importantly, learn from others who have been there before you.

So when you find yourself losing sleep at night, don’t get mired in the quicksand of self-pity and self-destruction. Every personal admonition of “What was I thinking?” should be followed with some objective analysis, maybe some help from a trusted ally, and a determination to get back on track and have fun. Being an entrepreneur is a lifestyle you must enjoy to be successful.

Marty Zwilling

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Friday, July 19, 2019

What the 5 Stages of Grief Teach Us About Technology

Kübler_Ross's_stages_of_griefHow many times have investors heard startups start their pitch by touting that their technology is “disruptive?” What entrepreneurs forget or don’t realize is that most customers are wary of all technology, educating the market on new technology is expensive, takes a long time, and people buy problem solutions rather than technology. Investors will likely wait for more traction.

The concept of disruptive technology was first introduced by Clayton M. Christensen in “The Innovator’s Dilemma” way back in 1995. Such technologies, like the digital camera and mobile phones, introduce such novel concepts that they displace existing technology quickly by societal standards. Unfortunately this “quickly” may be too slowly to save initial startups in the space.

In this time of rapid change, it’s easy to conclude that everyone is an early adopter, and we all tend to forget quickly the time and stages we go through while adapting to new technologies, and then loving them. It’s time to review the classic article on HBR “The Five Stages of Disruption Denial,” by Grant McCracken, comparing technology adoption to Kubler-Ross’ five stages of grief:

  1. Confusion. We don't quite get it. We sign up for the new app, or buy one of the new devices after we see our cool friends using it. We give it a whirl, and quickly complain that things were easier the old way. By this time, gurus are reassuring us that it is the greatest thing ever. But that doesn't help. We decide to wait another year for the next version.
  1. Repudiation. There are many people who don't get the new technology, and now social life is a little like a competition to show that we're not "falling for it." At this point, there can more social capital in saying that we don't like the technology than that we do. We all hear snappy one-liners like, "Twitter. What could I possibly say in 140 characters?"
  1. Shaming. This is when we are so persuaded that we're right and the new innovation is wrong that we are prepared to make fun of the credulous among us. "This Twitter thing. It's just a fad. Give it a couple of months and it will go away." We heard a lot of this sort of thing about Pinterest in the early days. Now it's valued at $13 billion.
  1. Acceptance. By this time, the innovation is taking off. The middle adopters are signing on. It is clear now even to late adopters (the great majority) that there is at least one useful aspect of the new technology, and it’s here to stay. Confronted by accomplished, irrefutable fact, the rest of us cave in, sign up, and brag about how modern we are.
  1. Forgetting. This is where we destroy the evidence, even in our own mind. Now we are inclined to act as if we always understood and approved of a world instilled with new innovation. One minute, we are too smart to be fooled by Twitter. The next we are fully on board. It's a like high school. We are captives of what Mark Earls calls "the herd."

In the old days, it typically took 20 years for this process to happen. Now it happens much faster, but it still takes longer that the survival lifetime of a struggling startup. Smartphone acceptance in the USA is now over 80 percent, only twelve years after the first Apple iPhone was introduced. There is other evidence that may be the new norm, and will be soon beaten.

Marketing guru Seth Godin mentioned in an article a while back that “it takes about six years of hard work to become an overnight success.” Mark Zuckerberg spent about 7 years and $150 million before Facebook became cash-flow positive. MySpace and several others, who arguably pioneered the disruptive social media technology, never really survived to enjoy it.

Too many of the entrepreneurs I know who highlighted their disruptive technology early ultimately ran out of money and had to shut down for being “ahead of their time.” They did everything right, but the market just wasn't ready. Sometimes this is just an excuse for other problems, but don’t forget the old investor saying: "being early is the same as being wrong."

Overall, I think more startups do fail by being too early to market than fail by being too late. This is probably a hard message to swallow, but it’s usually the second mouse that gets the cheese. What are you doing to avoid this trap with your disruptive technology?

Marty Zwilling

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Wednesday, July 17, 2019

Use Key Strategic Elements To Avoid Business Plateaus

Business-growth-plateauOne of the biggest challenges I find for new business owners is for them to move from working in the business to working on the business. You are so engaged in building and selling your product or service, that you “don’t have time” to focus on strategy and the next round of changes for the business to survive and grow. The result is a business plateau that hits you like a ton of bricks.

As a business advisor, when I bring this up, at best I will hear the defense that you are focused on the strategy of the moment, such as such as how to increase sales, or reach a new market. I have to admit that I have struggled with this myself many times, trying to understand all the dimensions of strategy, which has always seemed like an amorphous and overwhelming subject.

I was happy to see some good guidance on this subject in a new book, “Outsizing: Strategies to Grow Your Business, Profits, and Potential,” by Steve Coughran, who is a thought leader and consultant in this area. He outlines six dimensions of a winning business strategy, with some practical, research-based steps that I like, to focus on in achieving extraordinary results:

  1. Above all, deliver an exceptional total customer experience. The most successful companies today build a strategy to proactively anticipate the needs of their customers, as a group and individually, and totally delight them with all aspects of the shopping experience, value, delivery, and help with any follow-on questions or problems.

    For example, Apple has been a master at this, developing products like the iPod and iPhone before customers even knew they needed them, creating Apple stores with a whole new shopping and support experience, and intuitive usage needing no manuals.

  2. Highlight your competitive value, not your technology. This may sound obvious, but I still see too many companies with a strategy of highlighting technology improvements and features, rather than their value compared to competitors. This requires constant study of what your customers value, what competitors offer, and your target market.

    Converting customer-centric advantages into business value requires a deep understanding of all the financial elements of your business, as well as customer drivers. It starts with continually optimizing your business model, using analytics on all the data, and creating and using metrics to measure your performance and progress to date.

  3. Seek out and capitalize on emerging opportunities. We all wish we could “see around corners,” and are envious of people like Steve Jobs and Elon Musk, who seem to have this ability. With a little hard work at projecting market and technology turns, as well as the courage to make bold decisions, any of us can move further in this direction.

    For example, it doesn’t take a genius to see opportunities today due to the massive changes in healthcare, environmental concerns, social changes around the world, and the new generations of consumers. But it does take effort to weave these into a strategy.

  4. Unleash the potential of your team and talent. Strong leaders continually work on a strategy of hiring, developing, and retaining the best and the brightest. Too many business owners I know push these efforts to the bottom of their priority list, in favor of the operational crisis of the moment, or until they feel gaping holes in their team.

    Most successful CEOs now recognize motivated teams and a strong culture as one of the greatest sources of competitive advantage and long-term growth. A strategy of empowering people will produce near-term as well as lasting results for your business.

  5. Turn value creation (revenue) into value capture (profit). Strategy is more than hashing out mission, vision, and value statements. It’s making sure that these statements are financially grounded with specifics to assure an adequate return on investment for all constituents. Focus on user counts, or revenue alone, won’t make a long-term business.

    Smart growth and value capture strategies usually include selling more to existing customers and your current market, and selling current products in a new market. before developing new products or carving out a new and untested space for your business.

  6. Internalize the strategy process keyed to the bottom line. Strategy can’t be a one-time effort. Customers and the market don’t stand still, so your strategy can’t either. Efficiency is achieved through consistency and innovation, based on the bottom line results of your business. Establish a strategic cycle of initiatives, actions, and results.

With each of these dimensions, you can see that strategy is actually about working on the business, as well as in it. It’s hard work, and requires that you learn from your mistakes. Yet I’m convinced that we are operating at an exciting time, standing on the edge of new and exciting opportunities. Success won’t come from a random walk – build a strategy now for your future.

Marty Zwilling

*** First published on Inc.com on 07/03/2019 ***

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Monday, July 15, 2019

10 Ways Your Startup Co-Founder Is Like A Good Spouse

Sergey-Brin-Larry-Page-Eric-SchmidtAs a long-time business advisor and angel investor, I’m a believer that “two heads are better than one” in building a new business. Very few entrepreneurs have the range of skills and experience to be the solution creator as well as business creator, or operational as well as sales leader. The challenge is to recognize and recruit that ideal partner match early with minimal cost and risk.

In fact, I would broaden the definition of partner from co-founder to “business partner.” The reason is that good attributes apply equally well to “external” partners, as they do to internal partners, like a co-founder or CTO. A good overall example is the synergy between Google co-founders Sergey Brin and Larry Page, as well as long-time Executive Chairman Eric Schmidt.

In all cases, the challenge is the same, of finding people that you can work with and enjoy in the business relationship. The relationship has to have trust, communication, and respect in order to work. Otherwise, like a marriage, it will be doomed to constant conflict, second guessing, and unhappiness. So the following traits have to apply to both sides of the partnership to work:

  1. Capable of working collaboratively. Some people are too independent to be partner material. If they or you find it hard to trust others, love to work alone, always have to be in control, or insist on micro-managing, it may be time for change or looking elsewhere.
  1. Neither partner needs to be managed. Good partners are people who are confident in their own abilities, and willing and able to make decisions, take responsibility for their actions, and able to provide leadership, rather than require leadership.
  1. All partners have compatible work styles. Most entrepreneurs work long hours and weekends to get the job done. If you team with a partner who likes to sleep late, and reserves the weekend for other activities, the partnership will likely not work.
  1. Agree on a common vision and commitment. It doesn’t take long to sense someone’s real commitment, or vision and desired outcome of a joint project. Is your project seen by both as an end in itself, or a means to another end? Conflicting visions won’t work.
  1. Believe in similar values and goals. If one of your core values is exceeding your customer expectations for quality and service, and your potential partner ascribes to the low cost, high profit mantra, a successful partnership is highly unlikely over the long-term.
  1. Operate with a comparable level of integrity. High levels of integrity are important in business, but more important is your level of comfort with your partner’s integrity. This is a critical element of a good relationship, but a tough one. This is probably the best place to apply your “gut” feeling.
  1. Brings complementary skills and experience. If both of you are experts at software development, even though one loves design and the other loves coding, that still won’t get the marketing done. Look at the big picture first of development, finance, and marketing/sales.
  1. Feels a real passion and love for their role. The passion has to be in the business context – meaning results oriented, customer oriented, and sensitive to competition. In many cases, experts with academic or research credentials are not good partners for a business venture.
  1. Believe in the same ethical and diversity boundaries. How the leaders of your company handle adherence to the spirit as well as the letter of the law will be seen by all employees, customers, and investors. Ethics and the view of personal boundaries should be explored fully.
  1. Carry minimal historical baggage. Partner decisions are more important than team member hiring decisions. Thus you should do the same or more due diligence on educational background, previous work, and references. Look impartially from all angles and do the follow-up on all relevant previous roles.

Beyond the core team of two or three startup partners, every startup should seek to “outsource” the rest of their strategic requirements to external business partners. It’s faster and cheaper than building a large team in-house, and usually more effective.

By using this checklist, you should be able to objectively match potential partners with your own needs and expectations. Then, as I always recommend, it’s time to establish a formal agreement or contract to cement the partnership. With that, you will have a strong foundation for success, as well as a great working relationship for the next thirty years.

Marty Zwilling

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Sunday, July 14, 2019

10 Innovation Myths For New Venture Founders To Avoid

innovation-mythsMost people think innovation is all about ideas, when in fact it is more about delivery, people, and process. Entrepreneurs looking to innovate need to understand the execution challenge if they expect their startup to carve out a profitable niche in the marketplace, and keep innovating to build and maintain a sustainable competitive advantage.

Everyone thinks they know how to make their innovation into reality, but I can’t find much deep research on the subject. At the same time, myths about innovation are commonplace in business. Vijay Govindarajan and Chris Trimble, in their classic book “The Other Side of Innovation: Solving the Execution Challenge” have done some good work on the execution side.

They take you step-by-step through the innovation execution process, in the context the ten most common myths about innovation, which I think makes their approach particularly instructive:

  1. Innovation is all about ideas. While it is true that you can’t get started without an idea, the importance of the Big Hunt is vastly overrated. Ideas are only beginnings. Without the necessary focus, discipline, and resources on execution, nothing happens.
  1. A great leader never fails at innovation. When it comes to innovation, there is nothing simple about execution. The inherent conflicts between innovation and ongoing operations are simply too fundamental and too powerful for one person to tackle alone.
  1. Effective innovation leaders are subversives fighting the system. Effective innovation leaders are not necessarily the biggest risk takers, mavericks, and rebels. The primary virtue of an effective innovation leader is humility. What you want is integration with real world operations, not an undisciplined and chaotic mess.
  1. Everyone can be an innovator. Ideation is everyone’s job, as are small improvements in each employee’s direct sphere of responsibility. Yet most team members don’t have the bandwidth or interest to do their existing job, and well as address major innovations.
  1. Real innovation happens bottoms-up. Innovation initiatives of any appreciable scale require a formal, intentional resource commitment. That requires the focus and resources from top executives to sustain, even initiate, relevant efforts.
  1. Innovation can be embedded inside an established organization. Some forms of innovation can be imbedded, like continuous product improvement, but discontinuous innovation is basically incompatible with ongoing operations.
  1. Initiating innovation requires wholesale organizational change. Innovation requires only targeted change. The first principle is to do no harm to existing operations. A common approach that works is to use dedicated teams to structure innovative efforts.
  1. Innovation can only happen in skunk works. Innovation should not be isolated from ongoing operations. There must be engagement between the two. Nearly every worthwhile innovation initiative needs to leverage existing assets and capabilities.
  1. Innovation is unmanageable chaos. Unfortunately, best practices for generating ideas have almost nothing to do with best practices for moving them forward. Innovation must be closely and carefully managed, during the 99% of the journey that is execution.
  1. Only startups can innovate. Luckily for entrepreneurs, many large companies are convinced that they must leave innovation to startups. Yet research suggests that many of the world’s biggest problems can only be solved by large, established corporations.

Everyone agrees that the goal of innovation is positive change, to make someone or something better. Entrepreneurs need it to start, and established companies need it to survive. The front end of innovation, or “ideating” is the energizing and glamorous part. Execution seems like behind-the-scenes dirty work.

But without the reality of execution, innovative ideas really have no value. Customers are interested in solutions, and investors want to see the money. Your real challenge as an entrepreneur is to create an innovative business, not an innovative idea.

Marty Zwilling

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Saturday, July 13, 2019

9 Elements Of Every New Venture That Investors Expect

Business-model-canvas-prepNew entrepreneurs are always looking for a shortcut in getting their venture story and plan across to investors, and closing on the funding they need. An effective tool I see used more and more, as a prelude to a more detailed business plan, is the Business Model Canvas, first introduced by Alexander Osterwalder back in 2008. It forces you to bridge the gap between idea and execution.

The canvas is a visual chart with elements describing your value proposition, structure, finances, and customers, to help companies identify and align business activities. Now I see in an excellent book, “Business Models for Teams,” by Tim Clark and Bruce Hazen, an extension of this process to down inside the venture, for teams and individuals. It shows you how everyone works in synergy.

In my experience as a new business advisor, a business is nothing until people are aligned and work in sync. As an active angel investor, I look for this level of alignment and understanding in every funding presentation I hear. I look for evidence of the nine major elements of the model canvas, as paraphrased here from the author’s key points and how they apply to teams:

  1. Customer segments. A business without well-defined customers is never fundable. Valid customer segments must be quantified for every opportunity. Many businesses these days serve both paying and non-paying customers, such as Google and Facebook, who count on millions of non-paying users to attract advertisers, who really pay the bill.
  1. Value propositions. Think of value propositions as bundles of services or products that create benefits (value) for customers. The ability to deliver better value is the main reason why customers select one competitor over another. Value should always include not only functions, but also social, environmental, and emotional benefits as well.
  1. Revenue. Every business needs revenue to provide investor returns and offset costs. “Free” is not an attractive revenue model to investors. Popular revenue models today include recurring subscription charges, licensing, as well the traditional sale or lease model. Every team needs to understand how their activities relate to customer revenue.
  1. Costs. Every entrepreneur needs to know and communicate the total costs associated with their solution or product, including cost of goods sold, customer acquisition costs, capital costs, operational expenses, and partner costs. Every team and every individual should know their own cost contributions required to complete their activities.
  1. Key resources. Investors are looking for the sum of all assets that are truly essential for creating, communicating, selling, and delivering your value proposition. These normally include people, tangible property, intellectual property, and cash flow requirements. Secondary assets, such as desks and computers, can be ignored at the funding stage.
  1. Channels. Channels have to be identified through which a startup creates awareness, induces evaluation, enables purchase, and executes the delivery of the value proposition. Every team and every individual needs to know how they relate to, or are responsible for, specific customer relationships. Investors will demand clear channel definitions.
  1. Customer relationships. Today, businesses are all about customer relationships, not just transactions. Thus investors expect to hear about strategies and technologies that your company plans to use to manage all customer interactions, with the goals of attracting new customers, improving customer retention, and driving sales growth.
  1. Key activities. These are the important things the business must do to make a specific business model work, specifically creating, communicating, selling, and delivering value propositions. Then there is the follow-up to provide customer support and satisfaction. Entrepreneurs who can’t communicate specific activities are not ready for funding.
  1. Key partners. No startup or entrepreneur is an island. It takes partners to make a business work, normally including suppliers, marketing, channel, and distribution partners, as well as funding partners. Every partner has their own set of activities and required resources. Every startup looking for investment needs a solid partner story.

Beyond the investment, a major challenge that every entrepreneur faces is getting teams and every individual on the team aligned and committed to the overall strategy and plan. That step, commonly called the we-to-me translation, is another value of the business model canvas and its extensions. There are no shortcuts to funding, but it pays to use the tools that work. Try this one.

Marty Zwilling

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Friday, July 12, 2019

7 Wise Leadership Strategies When Smart is Not Enough

Bill-Gates-wise-lookMost of the entrepreneurs I have met are smart, but many are not always wise. That means they may show great insights into a new technology that has marginal business value, their passion may motivate team members more than customers, or they may allow themselves to be pulled over the ethical line in their success drive. Wise leaders are authentic, timeless, and enduring.

Of course, experience is the ultimate teacher of the differences between smart and wise. But none of us can afford to make that many mistakes, so it helps to understand the basic principles that are key to making wise, as well as smart, decisions. In their classic book on the subject, “From Smart to Wise,” Prasad Kaipa and Navi Radjou offer some great observations, based on their years of research and consulting experience with hundreds of leaders.

I’ve summarized their basic principles here, in the context of early-stage entrepreneurs and startups, in the hope of providing a head start, and fewer mistakes to recover from, for every entrepreneur:

  1. Broaden your perspective for your passion, to the greater good. Perspective is what defines us, and shapes our thoughts and actions. For technologists it drives the passion to take new ideas to new realities. Wise leaders tend to connect their worldview and ideas, to help everyone find a larger meaning in life. Steve Jobs espoused this principle.
  1. Act authentically and appropriately as your perspective changes. Wise entrepreneurs are sensitive to the context they operate in and fine-tune their actions accordingly, while continuing to serve their higher purpose. They never forget their moral compass, and maintain credibility by always bridging the saying-versus-doing gap.
  1. Learn to perform any role well, without forgetting who you really are. We all know a smart entrepreneur who wouldn’t give up the CEO role, and lost the company. Wise leaders give up an existing role when it is time. They willingly act as trustees or servant leaders in whatever actions and roles they accept. Bill Gates seems to fit this model.
  1. Expand horizons to make every decision win-win versus win-lose. Smart leaders tend to make decisions instinctively, based on their own experience, with little attention to the larger context. Wise decisions win in the long run for the broader purpose, as well as problem at hand. Don’t let practical execution or emotions sway strategic deliberations.
  1. Know when to hold and when to fold, with flexible fortitude. Many smart leaders tend to stick with a decision, without any re-alignment to a rapidly changing external context. Wise leaders show courage in following the context, and grace in letting go when appropriate. This flexible fortitude keeps them aligned with the long-term benefit.
  1. Act and lead with enlightened self-interest, to serve others. This world is now too complex for one entrepreneur to have all the resources and products needed to satisfy their customers. That means nurturing partnerships and cooperation with competition, for the greater good. It’s a move from pure self-interest to enlightened self-interest.
  1. Strive to create your own authentic path to wise leadership. First adopt the six leadership elements including perspective, action orientation, role clarity, decision logic, fortitude, and motivation. Then integrate these in your own path to wise leadership, building wise cross-functional teams, wise organizations, and wise communities.

Smart people impress us all with their intellectual power and uncanny ability to achieve their goals. But smartness alone is not always sufficient to keep entrepreneurs out of trouble and sustain their success. Wise entrepreneurs ultimately are the ones that create lasting value for both stakeholders and society.

Evolving from smart to wise requires nothing more than reflecting on the best practices of other wise entrepreneurs and emulating them appropriately in your own personal journey and roles. Now is the time to measure where you are along the path, and build the roadmap for your journey. Have you assessed your leadership style lately against these principles?

Marty Zwilling

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Wednesday, July 10, 2019

8 Ways To Learn From Your Team And Succeed Together

succeed-with-your-teamStarting and running a company is a team effort. Yes, it takes a leader (entrepreneur), but you can’t do it alone, without a team. Maybe only you and a co-founder comprise the team at first, to provide key skills, back you up, and test your ideas. As the startup grows, the team has to be able to really push you in making growth decisions, rather than you pulling them along.

The responsibility for leadership rests on you as the founder or CEO, and your leadership style. Many entrepreneurs still fall back to the traditional “control” leadership paradigm, but I don’t see it working so well any more. I agree more with Dr. Roger Schwarz and his classic book, “Smart Leaders, Smarter Teams.” He outlines eight keys to an effective mutual learning approach as follows:

  1. State views and ask genuine questions. When you state your views and ask genuine questions, you are convincingly open and curious. Understand that curiosity doesn’t mean agreement, and all questions are not genuine. Recognize that rhetorical questions seek to make a point or make people do something, not come up with a real answer.
  1. Share all relevant information. All team members need all the right information, before they can make, understand, and implement forward-looking decisions. That means sharing timely information that doesn’t always support your view, or might upset others. You should disclose your feelings, and any limiting factors like privacy or legality.
  1. Use specific examples and agree on what important words mean. If you hear someone on the team using a word or term that you think is unclear to others, ask for a specific example. This usually requires naming real names, rather than “someone,” and asking what you really want to know, without generalizing the question.
  1. Explain reasoning and intent. Teams are hardwired to make meaning out of problems. When you share your reasoning and intent, you reduce the need for others to figure out reasons, or assume something is being withheld. Start every meeting with one or two sentences that explain what you want to talk about and why.
  1. Focus on interests, not positions. Positions represent specific solutions from a given team member, whereas interests are the underlying needs that drive people to their position. You need a decision that meets all key interests, in order to get total commitment to the best solution from the team.
  1. Test assumptions and inferences. Assumptions are conclusions with no information. Inferences are conclusions about things you don’t know based on things you do know. Avoid assumptions, and test every inference by checking it against behavior confirmed by someone else. Untested inferences are among the main reasons a team gets stuck.
  1. Jointly design next steps. When you jointly design next steps, you design them with others instead of for others. It increases the chance that you will get a genuinely workable solution and that the team will be committed to implementing it. Keep in mind that joint design doesn’t mean that you give up your prerogative of making the final decision..
  1. Discuss un-discussable issues. These are topics relevant to a solution that team members won’t address in the team, due to fear or compassion. Examples include disruptive actions of a team member or a boss. Leaders may start the discussion outside, but must address it, with respect, inside the team for mutual learning and resolution.

Where you as the leader may be part of the problem in the mutual learning process, it may be necessary to ask a third party inside the organization, or a consultant from outside the organization to facilitate the transformation, or the resolution of a tough change issue. True leaders know how to move out of the way to let others do what they do best.

The results are improved performance, stronger working relationships, and greater well-being for you, your team, and your company. In the long run, every entrepreneur needs to remember that it’s the team, with their broader range of skills and experience, that builds the leader’s success – and not the other way around. This rarely happens with total control leadership.

Marty Zwilling

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Monday, July 8, 2019

10 Challenging Insights From New Venture Innovators

Insights-from-entrepreneursMost people agree that entrepreneurs have to think differently and take risks to have much chance of building a successful business. Yet I have found that serious entrepreneurs usually go way beyond these platitudes in their actions and thinking, and often won’t volunteer their real views, for fear of alienating “regular” people, and being branded a fanatic.

In the classic book “The Entrepreneur Mind,” from serial entrepreneur Kevin D. Johnson, he outlines 100 essential beliefs, insights, and habits of serious entrepreneurs. Most of these are predictable, like think big and create new markets, but I found a few, like the ten below, that will likely raise the hackles of many people outside this lifestyle, and many “wannabe” entrepreneurs.

Yet, based on my own years of experience “in the business”, mentoring many entrepreneurs, and following stalwarts like Elon Musk and Jeff Bezos, even these potentially controversial mindsets ring true to me:

  1. All risk isn’t risky. Entrepreneurs surely understand the high probability of failure, but they don’t necessarily like to gamble. Instead, they take calculated risks, stacking the deck in their favor. They must have enough confidence in themselves, supplemented by expert knowledge, solid relationships, or personal wealth, to see the risk as near zero.
  1. Business comes first, family second. This view isn’t a selfish one, but a recognition by serious entrepreneurs that family well-being is dependent on the success of the business, not the other way around. This is why airlines ask you to put on your oxygen mask first. Should you forego closing a million dollar deal to attend a ball game with your son?
  1. Following your passion is bogus. Look for a good business model first. Your passion may be for a good cause, like curing world hunger, but it may not be a good business. In any young business, you inevitably find things that are not enjoyable, but need to be done, like cold calls or firing unproductive employees. Just doing fun things is a myth.
  1. It’s not about being your own boss. Great entrepreneurs aren’t interested in being bosses at all. People who crave the freedom to do what they want when they want generally make terrible entrepreneurs. In order to be a successful entrepreneur, discipline is a must, and accept your new bosses as investors, partners, and customers.

  1. Fire your worst customers. We have all had customers who take advantage of us, to the detriment of other good customers. The best entrepreneurs are quick to make the tough decisions to bypass bad customers, with proper respect, to minimize frustration, resource drain, and reputation loss. You can’t please everyone all the time.
  1. Ignorance can be bliss. It’s great to be highly familiar with the industry in which you plan to compete, but many times people see too many challenges, and never start. In other cases, entrepreneurs are opening up new business areas, so no one yet knows the challenges. Serious entrepreneurs trust their ability to beat a new path to the opportunity.
  1. You’re in no rush to get an MBA. If you are already an entrepreneur, more education, including an MBA, will only slow you down. Consider it a waste of time. If you plan to become an entrepreneur, and already have business experience or an undergraduate business degree, skip the two-year delay and cost of the MBA.
  1. You are odd, and it’s OK. Entrepreneurs, especially those in technology, usually don’t start out as well-rounded, well-adjusted leaders. In fact, being odd is quite the norm. According to other studies, attention-deficit disorder (ADD) is common, as well as host of other personality disorders. It’s actually cool to be a geek in this lifestyle.
  1. A check in hand means nothing. Every entrepreneur remembers their naïve days when that first customer check bounced. When you receive a new purchase order, a check, a verbal agreement, or even a written agreement, don’t get too happy and excited. Save the celebration until you have cold cash in hand, or the funds are verified.
  1. There’s no such thing as a cold call. If you are an elite entrepreneur, you don’t go into anything cold. With the Internet and a plethora of other resources, you can warm up any call quickly, and not waste your time or theirs. Doing your homework first is one of the best ways to get an advantage over your competition.

If you think Johnson is on the right track, see his book for 90 more challenging insights. Even if you disagree with some of these, try to open your mind to the value of the seemingly backward way of thinking required to be a great entrepreneur – others seek refuge, they take risks; others want a job, they want to create jobs; others follow the market, while they define the market.

Have you caught the entrepreneur bug yet? If so, prepare for a lifetime commitment, and learn from the elite. There is no turning back.

Marty Zwilling

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Sunday, July 7, 2019

6 Keys To Growing Your Career Through The Gig Economy

Gig-economy-careerWhile everyone agrees that the “gig economy” is really here, the practical realities, other than not counting on long-term employment, are not so obvious. In my role as a mentor to many business professionals, I still see some who have no idea how to adapt to the new realities. The simple answer is that we all have to start thinking like entrepreneurs, rather than entitled employees.

To me, that means treating your career more like a business than a job – with a continual and global focus on keeping up with competition, finding customers, preparing for changes ahead, and taking responsibility for your own finances. With entrepreneurial thinking, this can be a win-win, with you getting more control, and good for companies, who want the more flexible staffing.

On the other hand, if you expect your employer to push you into future training required, always have a growth opportunity waiting, and set all your work parameters, then you may find a difficult road ahead. My recommendation is that you must start today preparing yourself for the future, by thinking of your current employer as a customer, and focusing on the following specifics:

  1. Quantify your value to your employer, compared to alternatives. I’m not looking for a personal guess, but some real homework done via networking and the Internet to see what other companies pay for the same role. Then look ahead to assess the likelihood that your job could be eliminated with new technology, artificial intelligence, or robots.

    This may seem scary, but it’s the reality, and what every entrepreneur has to do at every stage of survival and success. The good news is that this exercise, if done well, will be the best evidence to support your next raise request, as well as showing your readiness for the new gig economy.

  2. Assess your intellectual capital and how to increase it. It’s time to take a hard look at your breadth of experience, relevant relationships, connections, and skill depth, compared to your peers in that role. More intellectual capital means that you are worth more today in the marketplace.

    Take advantage of any and all current opportunities, such as industry conferences and special projects, to increase your intellectual capital for current roles and gigs in the future. Entrepreneurial thinking is all about being proactive, rather than wait to be pushed.

  3. Start tracking your costs as well as income elements. Most employees I know have no idea what their business life costs, since they have never had to worry about costs as employees. These costs include travel, training, supplies, office space, bookkeeping, and many others. You need to understand your real income requirements to survive on gigs.

    You will find it pays big dividends, even in your personal life, to track and manage expenses with a simple business platform, like QuickBooks or Apptivo, for work and family. With one of these, the step into the gig economy will be much less painful.

  4. Build your reputation and visibility beyond your company. Every employee or entrepreneur needs to build a competitive reputation on the Internet, through a website, blog, LinkedIn profile, and social media. Don’t let Facebook party pictures be the only way people see you when looking for a professional. Market your business expertise.

    In today’s gig economy, your professional reputation, references, and your ability to market yourself are the keys to success. All of these can be built and will serve you well while still an employee, looking for your next promotion or your first gig.

  5. Explore small gig opportunities without quitting your day job. Just as I recommend that aspiring entrepreneurs get their startup going before leaving a regular job, you should start competing for small gigs that can be done in the evenings or on weekends, to test your fit and needs, before you get forced into this world full time.

    In the current vernacular, these are often called “side hustles.” They make sense if you just want to pad your savings by creating additional income sources, as well as for testing the waters for your ability to thrive in the solo entrepreneur world of the gig economy.

  6. Regularly scan the marketplace for potential anchor clients. Before you get pushed out into the gig economy, you need to be looking for a few key clients that would likely select you and give you recurring business. There are already multiple gig platforms, including UpWork and TaskRabbit, that you can freely explore through the Internet.

You may think that gigs are relevant only to the low end of the skill spectrum, such as data entry and social media monitoring, but I see more and more highly qualified marketing and development people choosing the gig route rather than long-term employment for higher returns and more challenging work. Don’t wait for your next company layoff to get you started.

Marty Zwilling

*** First published on Inc.com on 06/21/2019 ***

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Saturday, July 6, 2019

How To Ensure Results From All Business Conversations

Connection-Business-CollaborationWhether you are trying to motivate your team, close a deal with a customer, or get funding from an investor, a casual conversation is usually a waste of your valuable time. These result is a founder who is always “too busy,” but never seems to get the business done and the team moving. All real business is conversations focused on creating results.

Shawn Kent Hayashi, in her classic book “Conversations That Get Results and Inspire Collaboration” makes my point very well as she outlines the top twelve types of conversations that relate to working together in business, and provides tips on how to make each of them more effective for all concerned:

  1. Conversation for connection. Connecting with others happens when we slow down our talking enough to be in the present and really listen to one another. Rapport building requires listening, more than talking. Powerful listening causes trust to grow.
  1. Conversation for creating new possibilities. The questions a manager or colleague asks help us to understand a situation better, if we ask good questions and really listen to the answers. Conversations can also be the triggers to professional development.
  1. Conversation for structure. When we know what we want to create, the next step is to devise a plan. We build our plans with the steps as we become aware of them through conversations, with ourselves as well as with others.
  1. Conversation for commitment. For each identified action step, we identify potential candidates and then seek their commitment to produce the result that corresponds to the task. The commitments we make to ourselves are the most fundamental.
  1. Conversation for action. What actions will make your tasks and goals come alive? We’ve all seen people get stuck in a project because they do not know what to do next. They’re not asking themselves or anyone else the right questions, and not listening.
  1. Conversation for accountability. After a conversation for commitment has occurred and the expectations are clear, being accountable for engaging others in what you want to do is a sign of respect. Sometimes people need to be guided into better outcomes.
  1. Conversation for conflict resolution. Many people will avoid conflict in work relationships at all costs, which is nonproductive. Others feel fear when the smell of conflict arises. A few overuse this conversation type. Conflict is normal, so deal with it.
  1. Conversation for breakdown. Anger indicates that something or someone has crossed one of our boundaries, and is a signal to address the issue. Breakdown recognition is vital to moving forward. Asking for what we want might actually clear up the breakdown.
  1. Conversation for withdrawal and disengagement. It is unrealistic to think that all work relationships will be enjoyable or friendly forever. Often it is best to end a tenuous connection, so that we can invest our time in ones that are meaningful and productive.
  1. Conversation for change. Your ability to change the direction of an individual, team, or an investor occurs through conversations. By design, you can change the conversation in the office, at board meetings, and with peers who seem to have gone off track.
  1. Conversation for appreciation. Think of the last time you felt really appreciated at work. Undoubtedly someone showed appreciation of your efforts using language that works for you. Affirming others through conversation builds relationships and momentum.
  1. Conversation for moving on. You have conversations for moving on when leaving a community or transferring or retiring from a company. One day you might reconnect, but for now you have closure, with no expectations of future conversations.

Being successful as an entrepreneur begins in a conversation with ourselves first, and then extends to others, focused on what we are passionate about, and the solutions we are bringing to market. None of these are casual conversations, where you don’t really listen to the response. How committed are you when someone is obviously not listening to your responses?

Marty Zwilling

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Friday, July 5, 2019

6 Ways To Help Others At Work And Still Save Yourself

Mistakes-to-avoid-managing-timeDon’t you wish you were better at saying “no” to all those extraneous requests for a bit of help at work? Every business owner and professional I know is struggling with their own workload, yet they let themselves get signed up for other people’s work, either out of frustration that things aren’t getting done, or guilt, or just plain sympathy. It’s time to stop jeopardizing your own future.

For example, as a software executive, I once had a talented engineer working for me who was always helping others, to the extent that he consistently missed his own project deadlines, and was ruining his health through lack of sleep. After some tough love by me, he admitted that he just couldn’t say no to all the people around him asking for help.

He didn’t realize that he had become part of the problem, rather than the solution. I found him a coach, and we suggested the following steps that may help you as well in declining requests from peers, without leading with the “no” that you find hard to express:

  1. Ask for a small delay, to give you time to think. Even though your first reaction is that this request will only take a second, it always pays to assess your own workload and deadlines before jumping into another commitment. A good approach is to buy some time with a small delay, such as “Let me just finish this task, and I’ll stop by to see you.”

    After some thought, you may realize that you are already overloaded, and this new request is not so easy. Also there may be someone, or additional homework, that you can suggest quickly. Always be sure to stop by as promised, to maintain your credibility.

  2. Offer one-minute mentoring up front, and stick to it. Have you ever noticed how many “Do you have a minute?” requests turn into an hour or two of your time? Without saying no, and without a major impact on you, most people will appreciate a quick pointer or two to get started. Ask them to come back with specific results, and don’t accept less.

    One of the biggest mistakes you can make is to actually take over and do the job for the requestor, rather than make sure they do the work themselves. If you do their job, they don’t learn anything, and you can bet they will be back again soon. Both of you suffer.

  3. Positively point out a better alternative source for answers. Now is not the time to complain about being over-loaded or mistreated. A better approach is offer the loan of a guide book or documentation that you would have to review first anyway, or point out an expert in the department or outside who might be able to answer the question directly.

    For people who are inexperienced or new to the job, this is the best help you can give them. For slackers and people just looking for a shortcut, you need to stand firm or you will find yourself slipping to their level. Doing many things poorly won’t help anyone.

  4. Ask the requestor for help in making your help time available. Look for a win-win approach. For example, you both might visit a supervisor to re-prioritize your work, or you may even trade assignments. At minimum, you need to make sure that you get credit for your time and contribution, since most help requests tend to get forgotten by requestors.

    Ideally, a requestor will be happy to point out to a supervisor the need for additional training or resources, or will think twice before admitting that they can’t accomplish a task without help. You should be happy to now be recognized as a frequent requestee.

  5. Avoid using the word “no,” but humbly decline the request. Without emotion or a long-winded reply, a direct reply is the most effective – “I’d love to help you, but my time is already over-committed, so I can’t help you on this one.” It always helps to suggest a specific later time, such as come back tomorrow or give me another chance on Monday.

  6. Soften any delay or decline with a “thanks for asking.” Research shows that people pay more attention to how your conversation ends, rather than how it starts. Keep the conversation positive, and give the requestor your full attention, including body language. Showing frustration or anger may get you out of this request, but will hurt you later.

Remember, your first obligation is always to deliver your own work. Being viewed as a “yes” person does not make you a leader. As you look around you, the most respected leaders are most highly focused on their own goals and priorities, and are more productive in the long run. Taking on other people’s work won’t increase your job satisfaction or your productivity. Don’t do it.

Marty Zwilling

*** First published on Inc.com on 06/18/2019 ***

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Wednesday, July 3, 2019

7 Tips For Entrepreneurs Seeking A Balanced Lifestyle

Macy's_Independence_Day_FireworksI know some entrepreneurs with successful businesses, and others who seem to have a great relationship with their family, but I can’t think of many who have both. Some people would argue that these two successes are mutually exclusive, but I’m not convinced.

Individually, they both take focus, commitment, and a variety of skills, all the strengths of a good entrepreneur. Assuming a person wants both a family and a business, the challenge is to achieve a balance that can satisfy both. This July 4th Independence Day Holiday in the USA is a good time for all of us to do a reality check on our own efforts.

From my observational experience, as well as my personal struggles on both sides of this equation, here are some of the key parameters of that balance:

  1. Start with a solid family and business foundation. A successful business won’t lead to a great family relationship, and vice versa. Don’t assume that your focus will change once your startup gets past the initial struggle. Keep in mind that your loved ones often see your business enthusiasm and energy as negative reflections on them.
  1. Be realistic about what brings happiness to you. Many entrepreneurs, especially women, gravitate to entrepreneurship because they see it as the way to balance work and family demands. That could mean they are forgoing happiness on the business side. Some men want a family relationship, but the business is what makes them happy.
  1. Find fun things in and out of work that are high priority. These don’t have to be expensive or hard-driving activities like sports competition. They can be simple in nature, like being present for school engagements, or regular Friday night “date nites” with the spouse. Practice consistency with “fun” and “high priority” elements.
  1. Assess your ability to compartmentalize the two roles. Achieving a balance requires an ability to put aside the burdens of work at the end of the day, and giving your full focus to important relationships. Separation of work and home are fuzzy for an entrepreneur, and it’s easy to find yourself on duty 24/7. Can you find the off switch on your cell phone?
  1. Be accountable for decisions you make. Remember, as the entrepreneur you are in control, and the business is not. Don’t let the urgent crisis of the moment become the priority of your life, to the detriment of your balance. Keep in mind that the sacrifices you make for the business also impact your family.
  1. Say “NO” and “YES” with equal frequency in both roles. Be honest in how your decisions will affect others in either role. Be in control of your priorities. The first step is to track yourself on these responses. Most people don’t recognize that they may have a habit of being negative in one role, and positive in the other.
  1. Communicate well and often at your business, as well as with family members. You need to keep an open mind and listen effectively to people in your business, and to people who are in your relationships. Pay attention to body language, emotion, and time spent speaking versus listening. Talking is not communicating.

Most people consider entrepreneurship as a lifestyle, rather than a job. Being married is a lifestyle, and raising a family is a lifestyle. Recognize that it’s harder to balance two lifestyles than it is balance a job with your real lifestyle.

Also mixing business with pleasure is one thing, but mixing business with family yields an altogether different, and often volatile, dynamic. Running a family business or “FamilyPreneurship” is even more difficult, and can derail or splinter cherished relationships.

Before you conclude that entrepreneurship is your chosen lifestyle, make sure you understand the balance it will require, and make sure those around you are prepared to accept that balance. A failure in this regard will likely cause you some fireworks you hadn’t anticipated.

Marty Zwilling

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Monday, July 1, 2019

6 Elements of Customer Psychology Drive Buy Decisions

Customer-buy-decisionsMany entrepreneurs think that adapting to the new technologies, like smart phones and Internet commerce, are the key to attracting new customers. In fact, businesses need to adapt even more completely to the changes in the buying and social behavior of consumers. High-technology product startups, without customers, don’t make a business.

Today’s customer buying dynamics are all about “user experience,” according to Brian Solis, in his classic book “What’s the Future of Business?”. This thought leader in new media asserts that every business needs to understand social psychology and rethink their business models, approach, and relationships in order to create unique and memorable experiences for both customers and employees.

Solis outlines the heuristics of social psychology that are key to building positive customer experiences today. These begin with the following Cialdini’s Six Principles of Influence, which consumers use to make decisions, buttressed by results from various social media surveys he references in the book:

  1. Social proof – follow the crowd. During today’s dynamic customer journey, consumers often find themselves at a point of indecision. When uncertain of what to do next, social proof kicks in to see what others are doing, or have done. Survey results show that more than 80% of consumers now receive advice through social networking sites prior to a product purchase.

  2. Authority – the guiding light. Perceived authorities guide decision making, by investing time, resources, and activity in earning a position of influence, leading to a community of loyalists who follow their recommendations. Most consumers now research online product reviews, blogs, YouTube, Twitter, and Facebook, for authoritative guidance.

  3. Scarcity – less is more. Greater value is assigned to the resources that are, or are perceived to be, less available. Driven by the fear of loss or the stature of self-expression, consumers are driven by the ability to participate as members in exclusive deals. 3 out of 4 people like getting exclusive offers that they can redeem via Facebook or other sites.

  4. Liking – builds bonds and trust. There is one old saying in business that is still very true in this age of social media: People do business with people they like. We all have a natural inclination to emulate those we like and admire. Almost 50% of shoppers surveyed admitted to making at least one purchase based on a social media friend recommendation.

  5. Consistency. When faced with uncertainty, consumers tend not to take risks. Rather, they prefer to stay consistent with beliefs or past behavior. When these do not line up in the decision-making cycle, consumers feel true psychological discomfort. The result is that over 60% of online shoppers are brand loyal due to other online satisfaction data.

  6. Reciprocity – pay it forward. Perhaps the greatest asset in social capital is that of benevolence. We have an innate desire to repay favors in order to maintain social fairness, whether those favors were invited or not. Every month, over 25 billion pieces of content are shared on Facebook alone, with a major portion oriented toward reciprocity.

Social psychology in general deals with how individuals relate to one another. In today’s social networks, the social economy is defined by how people earn and spend social capital. Based on the commerce of actions, words, and intentions (or actions, reactions, and transaction), people build their own standing. Startups earn relationships and resulting stature the same way.

Another aspect of the social psychology of consumer buying today is the four stages where customers take actions that move them toward you or away from your startup. These are sometimes called the four moments of truth:

  • Zero Moment of Truth. The few moments before people buy, where impressions are formed and the path to purchase begins. It is that moment when consumers grab their laptop or mobile phone, and start learning about a product or service.

  • First Moment of Truth. This is what people think when they see your product and it’s the impressions they form when they read the words describing your product.

  • Second Moment of Truth. It’s what people feel, think, see, hear, touch, smell, and (sometimes) taste as they experience your product over time. It’s also how your company supports them in their efforts throughout the relationship.

  • Ultimate Moment of Truth. It’s that shared moment at every step of the experience that becomes the next person’s Zero Moment of Truth. This one is required to generating word of mouth, advocacy, and influence.

So for all you technologists, who routinely focus their resources on a great product (“if we build it, they will come”), it’s time to balance the business success equation. Learning how to craft and nurture great customer experiences around your product is critical. The future of your business these days depends on it.

Marty Zwilling

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