Since an article I wrote in June of 2009 called “How a foosball table can kill your startup” is still sparking attention and conversation, I think the time is ripe for me to expand on the topic. Yes, I still believe that tchotchke “benefits” do nothing but waste money.  Instead, use your resources to attract new, retain your best talent, and improve your team’s happiness.

Here are additional issues for us to consider:

1. If we tracked the usage of Guitar Hero setups, foosball tables, pinball machines, etc., we would see that utilization of them is not really worth their cost and the rent we pay for the space they take up.
2. Often the toy/activity choice we make is driven by what we personally like. I highly doubt anyone actually thinks about how employees from other demographic groups perceive them. Therefore, we unconsciously create an environment of discrimination.
3. Innovation happens outside of the walls of our offices. Encourage your employees to get outside and network with their customers and spend more time with their families.
4. Employees are not stupid! We may be able to attract them with these “benefits”, but the novelty wears off quickly. The deeper we can tap into satisfying the needs of our employees, the more likely they will stay with us. Maslow’s hierarchy of needs is often ignored at our own peril.

So what do I suggest?

1. There is a MUCH higher ROI on well-being focused benefits. E.g. stock your office with free healthy snacks and drinks. Motivate staff to engage in group sports. Spend the budget on group company outings organized by the staff themselves. As an operations person, I always focus on keeping my team healthy, happy, motivated, and engaged.
2. Spontaneous rewards have tremendous ROI! Focus on rewarding exceptional performance the moment it happens (not months away during performance reviews). I have personally seen it do wonders to morale.
3. Enable your staff to be able to work in other locations from time to time and empower them to spend more time with customers (existing ones or prospects).  This takes a lot of planning and thinking through to execute well, but it has fantastic ROI and increases innovation and employee loyalty.

NOTE: the dynamics are a lot different in creative industries like industrial design, advertising agencies, marketing and communications companies, etc. Talent employed in these types of companies have different needs and motivations.

About the author:
Apolinaras “Apollo” Sinkevicius is a business operations leader with 12-year track record of building scalable and capital-efficient operations for technology and professional services companies.
He specializes in business operations, corporate culture, human capital, and technology issues.
To learn more about Apolinaras “Apollo” Sinkevicius please visit his site TheOperationsGuy.com

Similar Posts:

• Keeping entrepreneurs and CEOs out of jail and an early grave
• How a foosball table can kill your startup
• Beware of corporate cockroaches

I wasn’t able to make it to LaunchCamp Boston today, but was still able to virtually participate via the live video and Twitter streams. During a discussion on Twitter with two great marketing folks, Bobbie Carlton and Rachel Levy, I made several remarks:

1. Seasoned marketing pros should realize that “marketing” is becoming a dirty word (right behind PR) and evolve.
2. Marketing pros should stop fighting the fact that branding, PR, communications, content creation, “websites”, etc. are no longer being recognized as part of the marketing silo.
3. Businesses don’t need marketing teams, they need customer listeners/conversationalists who are deeply involved in customer anthropology.

Why is this my opinion?

1. Much has changed over the last decade with how customers interact with brands. A deeper transparency and conversation are now required to engage customers.
2. 2. The marketing silo is gone. Branding, listening, and communicating activities have transformed into something that engages the entire company – customer development. Customers define your branding, help you with content and product development, and provide your company with the publicity.
3. The marketing model of broadcast, analyze, and broadcast again is on its way out. Customers no longer tolerate being talked at – they demand that you listen to them. This new model is a constant loop of indentifying early adopters, developing products with the continuous feedback of the early customers, engaging mainstream customers with the help of those early adopters, and empowering mainstream customers to promote the brand. Rinse and repeat!
4. CUSTOMER ANTHROPOLOGY is the future. Strategies have changed and it’s no longer effective to have a traditional marketing model of yelling/broadcasting through the biggest proverbial bullhorn a company can afford (expensive launch events, advertising, PR, etc.). It is all about getting into your customers’ psyche, anticipating their reactions, and truly satisfying customers’ real needs. School-taught squeezing of customers into demographics, verticals, etc. is no longer adequate.

That all said, I may get a lot of flack for this article from my old-school marketing friends. Sorry, but a bit of constructive criticism is always good.  Please chime in the comments or send me an email. I want this to be start of the conversation, not just a one-sided article.

Photo credit: Carol Browne

About the author:
Apolinaras “Apollo” Sinkevicius is a business operations leader with 12-year track record of building scalable and capital-efficient operations for technology and professional services companies.
He specializes in business operations, corporate culture, human capital, and technology issues.
To learn more about Apolinaras “Apollo” Sinkevicius please visit his site TheOperationsGuy.com

Similar Posts:

• Keeping entrepreneurs and CEOs out of jail and an early grave
• If your staff does not get it, neither will the customer!
• How a foosball table can kill your startup

I can’t claim I was early social media adopter, but I have been on Twitter, Facebook, and LinkedIn for a while now and built a following.  I have met the majority of my followers in person. I am also not shy about reviewing businesses on Yelp and other sites, because I believe both positive and (especially) constructive negative feedback can improve businesses.

We have seen some massive changes in the last decade as the impact of word of mouth has grown exponentially as each new communication platform became mainstream. While a story of poor customer service experience used to rarely travel beyond a close circle of family and friends, everything has changed now that we have entered the age of social media. The tables have turned and the transparency and the accountability levels of the businesses are way up (intended or unintended). If you screw up, there will be video parodies of your business on YouTube and Yelp reviews containing the gory details – your (now former) customers will freely share their displeasure with thousands of their friends and followers before the dust has settled. Talk about a ripple effect!

But, as many companies are discovering, these are great times to turn customers into brand evangelists/promoters. The positive ripple effect aided by social media can be massive! Just look at Zappos, Amazon, Jet Blue, Virgin America, Apple, and etc,

So what can we, as business leaders, do to take advantage of this change?

1. Customer service should be the first place we invest in.  No more outsourcing! No more poorly trained and poorly paid script-reading robots!
2. Listen listen listen! Social media monitoring tools are available in every complexity and price range. Use them!
3. No, it is not fair, but the reality is that you need to take care of the “squeaky wheels” on public channels (like Twitter, blogs, etc.) first. Turn angry customers into rabid fans with a proverbial bullhorn. If it takes a CEO’s apology to satisfy an angry customer, then so be it.
4. All feedback channeled to your sales and product teams should be unfiltered! We tend to think our stuff does not stink, which is why I always advocate that sales people should also be doing collection on their accounts and developers, engineers, product managers should be answering customer support calls. Our dislike for unpleasant interactions makes us sell and develop products better.

Photo credit: Tom BlackwellSimilar Posts:

• Customers, not shareholders, pay your bills
• Why not let your customers tell you how to sell
• Keeping customers and finding new ones in a bad economy

The associated risks of starting a company are hard enough when you are young and unattached (though lack of experience and naïveté keeps you brave and motivated). But being in a long-term relationship, married, or a parent adds a whole new level of complications, risks, and motivations.

It is not surprising that VCs like investing in companies led by young, single, male entrepreneurs (some think this is because it is easier to control them and make them work 24×7).  But my own experience tells me that the vast majority of entrepreneurs are married and many are even parents. Our wives/husbands/partners are the true unsung heroes. Some of the most successful business people have a great supporter behind them.

Although I’ve mostly been an intrapreneur in my career, during my last venture I was a co-founder. Sadly, the company did not work out and cost me dearly. My wife was my rock through it all!  There is a reason I call her my “angel investor” – she is my biggest supporter and the best BS detector. Having someone really smart to bounce thoughts off of is an absolutely invaluable asset.

Here is what I have learned so far from my own marriage and business successes/failures:

• Business is second to family. No business is worth sacrificing your family for, and in fact, power, support, and inspiration can be derived directly from your “home team”.
• Communication with your partner is crucial! Especially when things go awry, walking around angry and frustrated will not help you or your marriage. But, if you communicate and use your partner as an advisor, you will get to a much better place faster.
• As the saying goes – perception is reality. Be honest with yourself, err on the side of caution, and set appropriate expectations. Allowing assumptions leads to painful consequences.
• Carve out time every week for your partner. No business conversations, emails, text messages, or voicemails allowed – just you and your better half.

Lastly, one of the biggest bonuses for an entrepreneur/intrapreneur with a great partner at home is that it forces you to think more clearly and learn how to sell your ideas. Almost every idea I could not explain well to my wife turned out to be a steamin’ dud.Similar Posts:

• Move your company forward by being wrong… often!
• What to look for in a business partner
• Keeping entrepreneurs and CEOs out of jail and an early grave

Since I don’t allow anonymous comments on my blog*, sometimes I get e-mails with long diatribes on why I am wrong. Some are quite extensive and come from people who take my critiques to heart (sometimes taking things too personally). Not only do I love these e-mails, but if you send one, be ready to have a dialog!

I am absolutely honored to hear comments in person or via social media. I enjoy knowing when my answers to a question on LinkedIn (or Answers.onstartups.com) or another blog helps someone. But the world would not advance anywhere if everyone agreed! Therefore, I also highly value feedback from those who disagree with me (as long as it is presented in civilized manner). My critics and detractors keep me on my toes! No one is right all the time and I often advocate that being wrong often helps us move our companies forward faster.

Here’s why I love my critics and why you should too:

• People who agree with you are much less likely to point out your weaknesses. Critics love to latch onto your weak points! Observe, listen, and improve!
• Without critics, one starts “drinking” too much of their own Kool-aid and believing their own BS.
• If no one is pointing out your weaknesses or predicting your failures, it means you are so insignificant that you are not worth someone’s effort to react to what you do.
• Critics are the cheapest way to get consulting. It is free advice you can use to your advantage.
• If no one in your company is criticizing your decisions as a leader, you have hired the wrong people! If no one has the testicular/ovarian fortitude to help you, you may be suffering from Napoleonic syndrome and surrounding yourself with brown-nosers.

* In my opinion, part of freedom of speech is accountability for your words. Since my blog is a conversation, I apply the same rules that I do in real world – if you have a comment, you can’t be a chicken and hide behind the anonymity of the internet.Similar Posts:

• Move your company forward by being wrong… often!
• Just say “NO” to ghost blogging!
• My boss does not answer my e-mails! What do I do?

One of the top five issues I’m passionate about is the need to increase the number of women executives, techies, scientists, and entrepreneurs. Why does this subject get so much of my mental energy?

• Progress is too slow! We are raising the next generation in an environment where women are still impeded by their gender.  Parents only want the best for their children, and we need to make sure our girls are judged on their merits.
• There is extensive scientific proof demonstrating that male-dominated teams are less efficient and less innovative than those with a healthy dose of ladies to break up their groupthink and egos. My favorite example is this paper by The London Business School – “Innovative Potential: Men and Women in Teams” (PDF)
• By failing to bring more women on board in visible roles and making sure their voices are heard, we are missing an incredible pool of talent since we’re only really tapping into 50% of the market.
• The biggest issue is when female executives, entrepreneurs, techies, and scientists have to waste mental energy dealing with the crap caused by misogynistic behavior.  Men consciously and/or subconsciously create barriers and discourage women from joining their teams. E.g. VCs not investing in female-led companies, professors discriminating against their pregnant female students, techie men looking down on their female counterparts, etc.

Here are my three biggest calls for change:

• Child rearing is the responsibility of both parents. Written and unwritten policies and expectations keep men away from truly participating in parenting. Time off, flex schedules, day care, etc. need to be highly promoted to male employees. I have seen plans like these in action and I know the results are spectacular. Without this change, other efforts have no chance.
• Any educator who dares to say women aren’t good at sciences or technology should be fired. We’ve been tolerating this hate speech for too long. We have missed out on great minds due to this garbage.
• Scandinavian countries are on the right track and have made changes through legislation (check out this article on Norwegian and Danish progress). We are behind the times and should also implement legislation. Since tax-paying women comprise 50.7% of this country, this should be reflected in the makeup of senior leadership teams of companies receiving any government business. Time to do an executive rank check or there will be no federal dollars for you. No effort by a school to attract women into fields heavily dominated by men? No federal funding for you either. Enough carrots, it’s time for sticks!

What else can we do?

• Our ranks will not become more diverse until we men genuinely open our networks and make a conscious effort to include more women in them. Connect outside of your usual “fishing grounds”.
• 99.99% of “diversity” efforts HR creates are BS because the vast majority of these policies are garbage just designed to keep the lawyers away. Our frat boy culture needs to be changed by the participants first – it starts with you! We built the “glass ceiling” and we can’t expect women to dismantle it on their own.
• Due to our upbringing or egos, we men create an environment that keeps civilized women away, because many of us deep inside know they can do anything we can do as well, if not better. This attitude needs to go!

I have to give credit to several others who have highlighted this subject recently.  Jeff Bussgang addressed why there are not enough female VCs (see his article The VC Gender Gap – Are VCs Sexist?) and the sharp-tongued Scott Kirsner of the Boston Globe addressed networking for women (see this article). I hope that by the time the next generation of girls comes of age that things will be much improved.

UPDATE 1/15/10: Jason Evanish (co-founder of Greenhorn Connect) pointed me to a great resource on their site – Resources for female business women, executives, and entrepreneurs in Boston area.

UPDATE 2/20/10: I have recently found a great whitepaper with research by Illuminate Ventures. Defintiely a worthy read. Here is a quote: “Organizations that are the most inclusive of women in top management achieve 35% higher ROE and 34% better total return to shareholders versus their peers – and research shows gender diversity to be particularly valuable where innovation is key.”

UPDATE 2/28/10: I have to mention a fantastic article Eric Ries has posted on his blog called: “Why diversity matters (the meritocracy business)” Eric does a great job explaining why diversity is a great measure of how meritocratic your organization is.

Photo credit: ayeshamus

About the author:
Apolinaras “Apollo” Sinkevicius is a business operations leader with 12-year track record of building scalable and capital-efficient operations for technology and professional services companies.
He specializes in business operations, corporate culture, human capital, and technology issues.
To learn more about Apolinaras “Apollo” Sinkevicius please visit his site TheOperationsGuy.com

Similar Posts:

• Why early stage startups don’t need business consultants
• Keeping entrepreneurs and CEOs out of jail and an early grave
• 5 ways to build diversity into teams

Back when I lived in Chicago, I had the pleasure of working with a really grounded and wise CFO. He was an “old dog” with a CV many would envy. During one of our conversations about work environments, he said something that stuck with me: “companies that get unions deserve them”. If you treat your people fairly, invest in them, and genuinely care about their future, no union or union mentality has any reason to exist in your company. So how do we make sure our employees are working for and not against us?

1. Shared pain & shared gain. The alarms are already sounding about an impending firestorm of talent defections. Retention is going to be hell for a large number of organizations that immediately turned to their employees when they needed to cut costs. Too late for them. But how can you ensure you survive the next up- and down-swings? Profit sharing is one of the best components of total compensation, and companies who adopt this strategy across the board retain and attract the best people. When the bad times strike, you can reduce or even eliminate the need for downsizing by sharing the pain across the board.
2. Keep an organization as flat as possible for as long as possible. Nobody needs dozens of VPs, when you have 30-40 employees (or even 100+). Doers are the best leaders because of their credibility. Red tape, meetings, hierarchy, and other org chart growing elements of an organization rarely improve efficiency. I don’t know about you, but I have a very high level of respect for the execs who pound the streets with the rest of their team.
3. You don’t have to be a mom or dad to your employees, but you do have to remember that you can improve an individual’s performance and value by helping them solve their problems. Example: if their spouse is also working and your employee has to worry about daycare, why not allow them to have a flexible schedule? If you help them get the problem off their shoulders, they will in invest that mental energy into their work.
4. Build a culture of constant growth. As a company grows, so should every member of your team (and if they don’t want to, then get someone who does). Nothing drives a successful team more up the wall than a couple of mediocre members. Some of the big consulting companies have a good policy – up or out!

Photo credit: Kymberly JanischSimilar Posts:

• Why not let your customers tell you how to sell
• How a foosball table can kill your startup – part two
• What I have learned about business leadership from competing in auto sports

I was recently overheard a conversation on the T (Boston’s subway) between two coworkers who were scheming on how to take more “sick time” without getting caught, brown-nose their boss to get what they want, and stay under the radar. These two individuals were corporate cockroaches!

I have an allergy to corporate cockroaches that no EpiPen can cure. They are the spoon of crap that ruins a barrel of honey and the rotten apples in a bushel of good ones. Nothing makes me angrier than those who try to game the system – their actions hurt both their team and company. As long as we turn a blind eye to corporate cockroaches, they will thrive, so we need to take an active role in keeping these people out of our organizations. 

Here’s how you can identify them.  Corporate cockroaches:

• Always ask “what’s in it for me?”
• Never show any initiative to take on anything new or even remotely risky
• Will never take responsibility for a mistake
• Spend more time brown-nosing the boss than genuinely helping the team
• Are exceptionally good at knowing office policies and play with loopholes all the time
• Never invest in bettering their knowledge
• Never work past 5pm and make excuses to leave early or take long lunch breaks
• Become the most political people during the hard times

Remember, an organization does not have to be large to have this infestation. Even a small startup can have scum on their team.

So what’s the cure? Be vigilant about the signs of an infestation and fire them without any mercy! Your organization needs to be filled with people who are passionate about their work!

Photo credit: Squall

About the author:
Apolinaras “Apollo” Sinkevicius is a business operations leader with 12-year track record of building scalable and capital-efficient operations for technology and professional services companies.
He specializes in business operations, corporate culture, human capital, and technology issues.
To learn more about Apolinaras “Apollo” Sinkevicius please visit his site TheOperationsGuy.com

Similar Posts:

• How a foosball table can kill your startup
• Keeping entrepreneurs and CEOs out of jail and an early grave
• What to look for in a business partner

I previously mentioned that I was blessed to have a father who was a very powerful role model (see my article “12 rules of business I learned from my father” to read more about him).  He shaped my views on leadership, teamwork, and business, and I wanted to share a story with you about a very sad, yet inspirational, day in my life.

While I was a wide-eyed teenager, eagerly soaking up my dad’s business advice, my father always used to say that the best indication of how well you have done in your life and people’s lives you have touched is by how many people pay their respects at your funeral. Sadly, several years later his words came to fruition. We tried to keep the news of his death quiet, because that is what he would have wanted, but much to my surprise, the word spread like wildfire.  The next day we had droves of people streaming in to pay their respects at his wake. I was floored. As the oldest son in the family, and bearer of his name, I stood there for two days greeting every person who visited. To a twenty-something fresh out of college punk, this was almost too much to handle.

I heard hundreds of stories during those two days. One woman (his former employee) came up to me and told me how he pulled a lot of favors to get her son in to see one of the top doctors in the country.  Her son was standing next to her. Another man told me how my father hired him when no one else would. This man went onto become a well respected reporter. Many people also mentioned how my father all always had his door open and found time to talk to people about their concerns.

So what are the powerful lessons I learned from all of those stories?

• A good leader does not sit in an “Ivory Tower” and delegate. “The air is thin up there and brown-nosing is rampant”, my father used to say. A good leader is close to their “troops” and cares about every single one of them (no matter if he/she has 1 or 2000). They lead by example and are the first ones out on the battlefield.
• People either love or fear their leaders. You have a lot more impact if your employees admire your actions.
• Caring about your employees at a personal level builds loyalty and dedication, which will help you weather the storms.
• Being a business leader is not just about profitability, it is also about changing the lives of your employees for the better! Put your people first and the value your shareholders will follow!

Photo credit: Robin HammanSimilar Posts:

• Managing freelancers, contractors, and suppliers in the startup world.
• 12 rules of business I learned from my father
• Lessons from Sun Tzu’s Art of War for startup leadership

I had a really fun conversation with a founder of a great company with fantastic potential today and we covered many topics, one of which prompted me to write this article. Securing money and investors are not always the biggest issue keeping startup founders awake at night. Assembling the right team from the very beginning can be a much bigger issue. I’ve previously talked about the traits you may want to look for in a possible co-founder and have covered the importance of a demographically and culturally diverse team. Today I will get down to the basics of how to start assembling your team from scratch. There are many perspectives on this subject, but I wanted to share with you what I have seen work.

Let’s start by debunking one common analogy – building a team is not like putting a puzzle together.  The number one rule I’ve learned from the best startup teams is that one trick ponies need not apply. In early to mid-stage startups, generalists should compose the majority of your team. There are two kinds of generalists: those who are Jacks-of-All-Trades and masters of one or two areas, and those who are masters of none (general management, which you don’t want).

Here are the rules of thumb I like for assembling a team:

• Until you reach a “comfortable” level of revenue, forget about specialists. (See my separate article on this issue). What makes one an asset versus a liability is the ability to step outside of the proverbial silo and competently get hands as dirty as needed. In addition, many times you can only afford one specialist for an area, which becomes a huge risk that I like to call “what if he/she gets hit by a bus?”.
• Don’t hire titles. Bring in people who are passionate about their areas of expertise and who love your industry. Passion for ones’ craft + love for mission of the company = talent worth their weight in gold. Plus, titles aren’t good for startups anyway.
• When building your team, take inventory of your strengths (even if it is just you), but more importantly, pay extra attention to your weaknesses. The best teams have members who complete each other. I like to build a matrix with the headings: “can do”, “can learn”, “can’t do” for each skill set and team member. Using this matrix allows me to keep better handle on areas we need to strengthen.
• Stay away from the “this is my baby” syndrome. Each member of your core team should be willing to build and hand off – you cannot grow your company if this is not the case. There is nothing worse than a person who micromanages or hogs an area of the business they consider “theirs”.
• Bring in people who have been at the level you want to be at in the next several years. There is no reason to bring on a big shot from a major multi-national corporation if you have no chance of being at the staffing, resource, revenue level that person is used to managing. If you are at $1MM revenue, get someone who has been at $50MM, but not $200MM or more. They will only get frustrated, cost you money, and leave before you know it.

Lastly, remember that there are always exceptions to every rule. I like to say that what makes you an expert is recognizing an exception for every best practice or rule of thumb.

Illustration credit: LuMaxArtSimilar Posts:

• Place of philanthropy in startup DNA
• 5 ways to build diversity into teams
• How to create a Non-Disclosure Agreement people can understand

I’ve had the pleasure of working for companies “as diverse as the United Nations” during my career. These organizations have greatly benefited from having very diverse teams and are doing well even in this horrid downturn. Why is diversity important?

1. Customers are diverse, so varied teams are much more likely to understand what your customers really want.
2. Teams with a diverse demographic makeup will have different ideas, broader viewpoints, and a more diverse experience base – this is a sure formula for better decisions.

So, it is no surprise that I get the following question from time to time: how do you build a diverse team?

Let me start with the #1 rule for building a diverse team: as a leader (founder, CEO, etc) you should always keep your personal religious, political, and other beliefs to yourself. I worked for a company where one founder was a devout Catholic and the other was not a fan of organized religion. If you never asked, you never would have known. It worked well, because we had almost every demographic group represented in the company.

#2. Let diversity happen. You can’t force diversity in your organization by selecting people like M&Ms in a candy store: some green, some brown, some red, some yellow, some blue. That is not diversity that is “diversiwashing”.

#3. Diversity starts during your selection process. You must judge people based on their skills, ability to learn, and fit in the organization. If you want to use tests for these characteristics, then use only the ones that will not stifle diversity (cognitive and technical skills tests). Predictive Index, Devine Inventory, and many other tests that predict your personality based on word associations (or other language-based methods) are very bad for your company if you want any kind of diversity. There is a reason why sales people for PI, DI, etc, will never provide you with real peer-reviewed scientific studies and demographics used to evaluate these studies.

#4. Let your team vet the candidate, but don’t let them make final decisions on fit. As a leader of a company, you are entrusted with the vision and the path. Sometimes even the most well-intentioned teams will pick people just like them. Other times they will not be able to see how that person could be a great fit, but you know he/she will.

#5. Celebrate and educate! I am always a big fan of introducing policies that include at least X days per year for “personal reasons” and letting people work during holidays they may not be celebrating.  Example: everyone gets Independence Day and New Years off, but if you don’t celebrate Christmas, why should I force you to take a day off? On the subject of celebrations, always look for ways to include everyone. If it is Chinese New Year, why not congratulate your team members who celebrate it!  Another thing I like to do (since I am a foodie), is to bring my team together through food.  Have a company lunch where everyone brings their favorite dish, with bonus points for something most restaurants don’t serve, and extra bonus points if no one ever tried it before.

In my experience, it is never too early or too late to make sure you are thinking about diversity.  You can be a 9 or 120+ person startup and still be diverse.

Photo credit: Quinn DombrowskiSimilar Posts:

• Time to end the frat house culture! We need more women in our midst.
• Move your company forward by being wrong… often!
• Beware of the lemmings!

I am a firm believer that delegation is key to building a business. We can bring in all the technology in the world, but if we can’t delegate properly, our companies have no chance of scaling well. I have had the pleasure of spending many years in very rapidly growing companies and have made the following observations:

• Delegating work does NOT absolve you of responsibility. In the case of a failure, the blame is all yours. Investors will go after the CEO, even if a network admin made the mistake that hurt the company.
• If a failure occurs due to a person lacking skills, it is your fault for delegating work to the wrong person.
• If you have to say “if you want it done right, do it yourself”, you may want to get some education on leadership and the art of delegation.

Delegation is something leaders need to master, because you can’t scale your organization without it. Without delegating well, you are bound to flat-line or even drive your company into decline.

So here are the rules of delegation I like to use:

• Do not assume team members (even experienced ones) are clear on what needs to be done. Go into detail until YOU are confident the other person will execute the work as specified.
• Micromanaging is not delegating. You must have trust your team member and not hover. If you must hover, re-evaluate if the task is delegable or if you need to readjust your management style.
• Communicate any and all pitfalls, points of caution, and other negatives that may affect the delegated work. Also share any best practices, sources of additional information, or personal tricks of the trade. Part of delegation is teaching.
• When it comes to communications, it does take two to tango, but you need to take the lead.
• If you can’t trust someone to take on delegated work and are not willing to invest in their personal development, than you need to replace that employee. This kind of person just drags down your organization.

If you have any other rules of delegation you practice, please share them in the comments section.

Photo credit: Firefly the GreatSimilar Posts:

• 12 rules of business I learned from my father
• Can’t retain talent at your company?
• What I have learned about business leadership from competing in auto sports

It has been almost a decade since I lost my father to cancer, but the lessons I learned watching him run large companies, creating startups, and turning around languishing businesses are still fresh in my mind. I credit him for my business ethics, “workaholism”, leadership style, and pragmatic yet optimistic outlook. He was a man of few words, but when he opened his mouth, everyone listened. In this post I will share some of the rules of business he taught me.

• Run from those who think they are smarter than everyone else and those thinking that all of their ideas are “hot”.
• The best relationships are those built in bad times.
• There is no age limit to having a mentor.
• If you feel like you are surrounded by a-holes, maybe it is you who is making people act that way.
• B.S. always floats to the top and people will find out who it belongs to.
• Youth gives you ideas, but age allows you to sense which ones are B.S.
• Air is thinner at the top, so don’t build high mountains. (Less layers of management are better)
• Be wary if no one is criticizing you anymore or if all you hear is praise. They either drank too much of your “Kool-aid” or they are looking to pull wool over your eyes.
• Only morons don’t make mistakes, because all they do is a mistake. (I know, this does not translate too well from Lithuanian)
• Let your competitors waste money on “rainmaker” salespeople. Hire the best customer service team you can afford and make best product you can.
• It is hard to swim in a wake of a big ship. Don’t follow big competitors, outmaneuver them.
• Loyalty and dedication to the company must start from the top. So do sacrifices to keep the company alive.

I would love to hear about any business rules you learned from your mom or dad. Please share them in the comments section.

About the author:
Apolinaras “Apollo” Sinkevicius is a business operations leader with 12-year track record of building scalable and capital-efficient operations for technology and professional services companies.
He specializes in business operations, corporate culture, human capital, and technology issues.
To learn more about Apolinaras “Apollo” Sinkevicius please visit his site TheOperationsGuy.com

Similar Posts:

• Keeping entrepreneurs and CEOs out of jail and an early grave
• How a foosball table can kill your startup – part two
• What to look for in a business partner

Being in operations, I’m usually the right-hand-man for the CEO (and CFO), and have worked with some fantastic ones and a few who should have let someone else pilot the company. Not everyone is cut out to be a CEO and nowhere is this as evident and crucial as in startups. A good CEO can take the company anywhere he/she dreams it to go.

As I search for a head of operations position and talk to employees and founders of startups, one of the key phrase I am listening for is “my CEO [insert the rest of the sentence]”. That is what I want to hear. Yes, many will say “our CEO”, but there is a difference when someone adds emotion to their alliance and proclaims he works for his/her CEO.

So what is the difference? If I hear someone refer to their CEO as “my CEO”, I can ascertain people on his/her team will walk through fire for the company. Passionate trust in the leadership of a company builds resilient startups.

Here’s my table of the most common reasons people may call the head of the company “my CEO” versus “our CEO”:

I want to hear what makes you proud of your CEO.

Photo credit: Mark Kobayashi-Hillary

Note: statue in the photo is of one of the greatest dukes Lithuania ever had – Gediminas.  This statue is located in Katedra square, Vilnius – Lithuania.Similar Posts:

• Why do so many CEOs have no idea what operations people do?
• Delegate work, not responsibility
• Beware of corporate cockroaches

I read a Wall Street Journal article today, titled The New Résumé: Dumb and Dumber - Job Seekers Play Down Their Credentials to Avoid Looking Overqualified,” that really struck a nerve with me. This issue is not exclusive to Baby Boomer and reaches all the way into Generation X. We talk about how it is hard to find the right people for our companies, but we are not willing to think just a little bit outside of the box. Here is a novel idea, why don’t we stop forcing overqualified individuals to hide their qualifications and try to make a deal with them, while the demand is low.

Here is my recipe for hiring and keeping overqualified professionals:

1. Set the proper context in your mind. As a hiring manager, be appreciative that someone with superior skills is willing to take a position “beneath them.” This shows how well their ego is controlled. Keeping this context in mind will set you up to have a more successful conversation. Focus on making sure the candidate really fits the corporate culture and is genuinely interested in your company.

2. Show your excitement that you’re able to have someone with a high level of talent come in and help you solve your current needs and have them willingly take the compensation in line with their current value to the company. Reassure the candidate that as their value to the company increases, so will their compensation.

3. Invest time in showing “overqualified” candidates the roadmap and milestones you want to reach. Think about how this person could contribute to your team in the future, and how he/she could earn their way to the position and compensation more fit to their level. This is how you take care of your future today and ensure you have a good team member.

People have a very good memory. It is an absolute myth that top grade talent can always find a job. Usually this BS is sold by inexperienced recruiters who need to cover up the fact that their candidate pipelines are skimpy. Don’t believe the hype! Find that “overqualified” talent and do the best darn job you can selling them on joining you now! By helping someone in bad times, he/she is much more likely to be loyal to you. Just think about the money and resources you will save once things bounce back up and your competitors will not have the chance to grab that cream of the crop individual!

Photo credit: Kim KreidlerSimilar Posts:

• Difference between “My CEO” and “Our CEO”
• Companies that become unionized deserve it!
• How to build your startup core team

One of my favorite books is Sun Tzu’s Art of War. I have read it several times and is one of my top 5 favorite books. Although the teachings are very old (6th century BC), there is much that can be applied to the modern day hyper-competitive business environment. Here are some of the lessons I have learned:

• An individual contribution (or lack of it) can make the difference between a startup growing or becoming another fire sale. Everyone must be on deck and stand in the heat of the kitchen; if they can’t – show them the door. Even startups flush with cash can’t afford slackers.
• If directions are not being followed, management is failing to communicate. Clear messages don’t get misinterpreted.
• My father ran some large organizations with great success and I learned one big lesson from him: there is no gray zone in leadership. People follow you because they love you or because they fear you. The first one works much better, but you should not be afraid to chop some proverbial heads of those who endanger your company. You must be capable of both styles.
• Never engage your competitor head-on! It is good for your ego, if you win, but it is too costly in resources. It is about running a “territory game” (market share) and not about taking down your competition. Since it is the customer who pays your bills, you must “outplease” your competitors’ customers and turn them into yours. Focusing on pushing your competitor out of business does nothing to increase your bottom line.
• It is unlikely you will win with a team full of mercenaries (freelancers). Their loyalty is not to you. Build a strong team of “soldiers” with ferocious loyalty, and the drive for a common cause, and sense of belonging.
• Preparation trumps everything. There is no excuse for not figuring out everything in your control before taking huge steps. Focus on customer development. Many of us think our idea is the hottest thing in the world, but if customer is not willing to pay for it, than our idea is worthless. Do small scale pilots, work with customers to build your product/service, and build a solid foundation to scale.
• Don’t toss good money after bad. If you fail small, you live to fight another day.
• Rash, cocky, ego-driven behavior reaps some of the most bitter outcomes. Ego does not provide you with the guts to go against big challenges, it actually clouds your vision. Don’t ever stop thinking with your wallet and your brain.
• Building visions of grandeur from the stories of the very few who got lucky and made it is dangerous. Many more have “perished” on the way to success. Focus on learning how to avoid the pitfalls that broke the backs of entrepreneurs before you.

Photo credit: vlasta2

Similar Posts:

• Keeping customers and finding new ones in a bad economy
• If your staff does not get it, neither will the customer!
• Customers, not shareholders, pay your bills

Entrepreneurship is what keeps this country afloat even in these bad economic times. It is a known fact that small businesses create more jobs than the big boys. Entrepreneurship has also jump-started the economies of countries that escaped the oppression of murderous regimes. People striking out on their own create value, jobs, and wealth for everyone around them and this is an absolutely applaudable achievement. But, why do we glorify the entrepreneur way of life and less than 5% success ratio, rather than looking at what mistakes those 95%+ who failed made, publicizing them, and making sure the new crop never repeats again? In my career I have been part of several failures and many great successes, and I learned more from the failures! I don’t treat the mistakes we made as some kind of know-how to be hidden. Heck, majority of the articles I have written are based on what I have learned from the mistakes. I hope people who I share them with will be less likely to repeat them.

I know I can’t change the mentality of all the old and new entrepreneurs, but if I move 2 or 3 to change and they do the same, we can make a difference. I know some of us walk in shame about our failures and choose to keep them to ourselves, instead of using them to benefit the business community. But we need to get over that and start showing others the path NOT to take. Guy Kawasaki, Steve Blank, and some other entrepreneurs and now investors have no problem publicizing their past failures, so the rest of us can learn from them.

I will leave you with some food for thought: my late father used to say that smart people learn from the mistakes of others and dumb ones want to learn everything on their own.Similar Posts:

• Move your company forward by being wrong… often!
• Beware of the lemmings!
• Sampling of the biggest mistakes startup leaders make

This article is a follow-up to my earlier commentary about small scale business experiments entitled “What can startups learn from MythBusters”. Since I am a happily married man, soon to celebrate another wedding anniversary, I am comfortable with being wrong. And according to my highly-educated wife, being wrong often is something I do well.

What is my point? One of the things I have learned early in my career (and marriage) is that acknowledging your mistakes and working to not repeat them is what helps one move forward and evolve. In my professional life I have seen some spectacular failures. Some of the most memorable ones were committed by business professionals who apparently were never taught that there is nothing wrong with making mistakes, but it is absolutely malicious to not admit your faults and attempt to cover up your mistakes.

In the startup world, unrecognized and/or unacknowledged mistakes tend to create much more damage, than in a larger organization. Professor Rosabeth M. Kanter in her article “Three Little Words Every Leader Needs to Learn” said: “If a leader cannot admit being wrong in a timely fashion, he or she can never correct mistakes, change direction, and restore success.”

So how do we fix things? First, most of us need to put our fragile egos aside, and put a lid on control mania. Second, we need to not only acknowledge and embrace our mistakes, but also build teams around us with people smarter than ourselves. If you have people around you who are empowered to question your decisions, propose better solutions, and draw on their past experiences, you are much less likely to stumble.

If you have a team not afraid to jump in and catch you, you are much more likely to take the risks needed to drive your business forward. It is like walking the tightrope. If you know you have a net below you, your likelihood of getting to the other side is much higher.Similar Posts:

• Should we glorify the failure of entrepreneurs?
• Sampling of the biggest mistakes startup leaders make
• Keeping business and IT people from each other’s throats.

As some of you may already know, I am an avid “car guy” and starting my third season of autocross competitions (an auto sport, for those not familiar I have included a video below of what it is like). I did well in the races when I lived in Chicago, but encountered much more skilled competition when I moved to Boston, and it’s taken me awhile to move up the competitive ladder here. As I was recently pondering my strategy and goals for the season, I realized that some of the rules of racing are also very useful analogies for the world of leading companies (especially startups). Here is a sampling of several things I learned in racing that directly apply to business:

• Anticipate what is coming and let your peripheral vision and instincts deal with where the car is now. In racing we look one, two, or even three corners ahead and trust our instincts, experience, and training to handle where we are at the moment. If you spend a lot of time in the office studying your spreadsheets, reports, etc. instead of going out and talking to your customers, attending every networking event pertinent to your industry, and meeting people with the same fervor as if you were looking for a job, then the unexpected will blind-sight you.
• Multi-tasking is over-rated. You only have so much cognitive “cash”, so spend it wisely. In racing we remove all possible sources of distraction (including ignoring parts of the course that don’t matter). We never fidget with switches, mirrors, or do anything else besides driving. We prepare and learn to trust our cars, so we can focus on the road ahead. Micromanagement is the equivalent of multi-tasking when you are leading. In order to lead an organization effectively, you need to make things “instinctive”. What do I mean by that? Be very clear about your expectations and communicate them, delegate work without delegating responsibility, automate the mundane tasks, outsource the frivolous work, and empower your team to make the right decisions.
• A good driver can win even with a sub-par car. Buying a better car does not make you a better driver. Same goes for business. Better tools should only come after your team has developed sufficient skills. People with more powerful tools and lack of skill cause more damage to their organizations than if they were using something that limited them. I bet you have seen police reports of some yahoo crashing his high-performance sports car 10 miles from the dealership. Business world is no different. It is littered with “crashed” companies that were full of inexperienced and poorly trained people.
• You can’t make hard turns and change your speed (break/accelerate) at the same time. Driving organizational change is a balancing act. In racing we call it a “friction circle”. The same concept applies to business. Don’t change everything all at once or you will “over-drive” the organization and end up off-course.
• Small changes can make a big difference. Skilled drivers make small adjustments all the time. For example, they tweak tire pressure in small increments until they get exactly what they want. Focus on the impact that little details will have on the large picture. Those who make drastic changes usually end up with horrid performance, spinning out, or damaging their rides. Especially in the startup world, it is better to fail small and often, because you learn, improve, and live to try again another day.
• Smooth drivers win over crazy drivers. Fluid measured motions make the physics work for you. In the business world, the best of the best let their business dynamics work for them. It is easier to innovate when you are not battling the world. Trying to turn the market in a drastically different direction does not work.
• Going full throttle will only last so long before something will break. You can’t subject your team to non-stop high intensity work without risking a catastrophic breakdown. The goal is to last the entire season, not just win one race before your car breaks down.
• The best drivers always look for feedback and opportunities to learn. I have seen the most gifted drivers ask for other good drivers to hop in their car and give them some feedback or tips. Learning and improvement never stops! Those who invest heavily in learning are the ones who get the trophies.
• You are only as good as your competition. It is easy to win trophies when all your competitors are rookies. But that gets you nowhere in the long run. There will come time when a real competitor will come by and take away all your “glory”. In the business world I hear some entrepreneurs exclaim in their naiveté that they have no competition. I pity their investors, because fire sales are soon to come!  For those of us who are not naïve, we know that competition is a mother of evolution. We look for it, we better ourselves, and we are always vigilant.

Similar Posts:

• Lessons from Sun Tzu’s Art of War for startup leadership
• Sampling of the biggest mistakes startup leaders make
• Beware of corporate cockroaches

Today on Twitter I was led to a post by Mike Hudack (CEO of blip.tv) and found the following diagram:

Here is what I completely agree with:

• You can’t move markets alone! You need to do it with your team, a group of entrepreneurs, and… your customers!  If you let your ego cloud your sense of reality with visions of grandeur, you will be just another failed “entrepreneur”.

However, after 12 years of experiencing “startup scars,” I disagree with two elements of the diagram above:

• Effectiveness over masochism of “busy-work”. Startups do need visionaries and those ready to move mountains. But, I think there is too much glorification of 100-hour weeks and self-abuse. “Hockey-stick” growth happens with effective execution; not with everybody conducting “death marches”. We can’t deny the endless research showing that exhaustion’s effects on brain function leads to less effective decision making.” Spend less time playing around, reveling in being a startup, and creating huge plans. Rather, start piloting, getting ideas into manageable actions, and getting things done! Too many entrepreneurs focus on their foosball tables, funky offices, endless beer in the fridge, etc.
• Having dreams and visions about your product does not make you a good entrepreneur. Get an idea of the direction you want to go and speak with prospective customers! Steve Blank preaches this, along with an increasing number of entrepreneurs that  have decades of experience under their belts.  We need to be excited about our customers paying us to solve their problems.

If I were to create a diagram, I would have the following items instead:

• Are you ready to fail?
• Are you ready to fail many times in order to succeed once?
• Do you know what the definition of “madness” is?
• Do you get so attached to your ideas that you won’t let others mold them? (No – means you are an ego-maniac not an entrepreneur)
• Do you understand that being persistent and resilient requires you to be very flexible?
• Are you willing to clean your own toilets, sweep you own floors, and clean up after your employees had lunch? (No – stay in the corporate world)
• Do you think that being a founder/co-founder makes you a CEO? (No – the right answer. Yes – this means you are in it for the ego, not for the money)
• Are you in this for the money or to prove something? (Right answer: money)
• Do you think startups are small copies of large corporations? (Yes – startups are not for you)

Big part of the reason I chose to write this post (including encouragement by Justin Whitaker) is because we have too many people thinking they’re entrepreneurs. They see an over-glorified simplification of what it takes to succeed and jump in lacking a full understanding. Too many naïve (often young and inexperienced) folks get into entrepreneurship and cost vendors, creditors, investors, and themselves money and real resources. Many times you are better off working for someone, accumulating some real world experience, building up scar tissue, and only then venturing out to become an entrepreneur.Similar Posts:

• Random lessons from 12 years in startups
• Why I LOVE critics and why you should too
• Union mentality and lean startups can’t co-exist