The past few months have been the most eventful ones in my adult life. Most importantly, I became a father! I have been in startups my entire career, but this new “startup,” my beautiful daughter Greta, has tested my planning, troubleshooting, and iterating abilities while providing me with an incredible amount of “fire”, clarity, focus, and zen-like calm. So, it is probably not surprising that this huge event has also served as a strong catalyst for several other changes.  I took two months off to be new dad and supportive partner (a luxury in the US) and also decided to leave Pixability for the next venture to scale.

My exciting news is that I am joining the One Mighty Roar digital experience agency as a Managing Director and COO. Their team of truly gifted people, stunning list of household name clients, and top secret stuff I can’t talk about just yet is an absolutely irresistible combination to someone who lives and breathes scaling companies! Zach, Sam, and Brian have built the foundation of a pillar Boston company, and I look forward to not only continuing making a name for ourselves here but also opening offices in other US and international locations.

P.S. Becoming a parent, especially in a marriage of equals, is something many people building companies haven’t experienced and therefore don’t truly understand. I will never look at parental leave the same ever again and, I believe having this experience makes me for a more compassionate executive. And yes, the 2 week leave most companies give fathers is cruel and unusual punishment – a separate article on this is coming.

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Admit it, it is hard finding talented people with a good attitude, who are not set in their own ways, and who are eager to improve their skills! Yes, we are already at a disadvantage since we don’t have the deep pockets of an IPOed company. But, we also tend to create several other self-inflicted major disadvantages:

• Using a fishing analogy, we “trawl” instead of using our line to fish for candidates. If your recruiting team complains about too many resumes, they either need to be re-educated or fired.
• We look for “Mr(s) Perfect Fit,” which is just about the dumbest way to lose out on incredible talent. An unwillingness to hire people with the right foundations and mentor/teach them into their roles is about as malice as using the company’s funds on lavish personal expenses.

Companies that are not truly innovative in their talent management and do not practice talent arbitration will likely shrink, if not go out of business, in 2013. Boston, NYC, Chicago, Austin, etc. do you hear me? The best products will never exist without the right people to build, sell, and maintain them.

So let’s talk about the crown jewel of business strategy – talent arbitrage. It is hard, it takes time, you have to learn a lot, and you can’t do it alone, but the return on the investment you get is phenomenal. And this is why I want to share with you how I do it! Let’s get to it!

The common views of talent are flawed! The best talent is never well-rounded.

As I have written before, you can’t be phenomenal at something and be well-rounded too. So let’s stop searching for unicorns! In the rare cases we come across a seemingly “perfect” individual, we tend to later discover he/she is a master of political games and cover-up and has more skeletons than the tunnels of Paris.

So instead of chasing unicorns, why not truly start recruiting for the talent strengths we need and can further develop. This is practicing talent arbitrage and you will be able to recruit those that you may have thought were out of your reach.

Candidates with a “chip on their shoulder” usually have an endless self-driven energy. Hook up this energy to your company!

What do these “chips” look like? You will know them when you come across them. For example, very seasoned individuals with a recent series of failure on their shoulders may want their good names next to some wins again and know they need a winning team to get there. If I don’t think these failures will be a problem to us, then I want to recruit these candidates, because they will hustle like no other and not give up easily. They just can’t afford to perform half-heartedly!

Another example is a parent who took an “extended” (in an American view) time off to raise their kids. My experience has shown that, if you were darn good before you took time off, then you will be back on top again soon since it is like riding a bicycle. But, most US employers and recruiters are extremely shortsighted, so my talent arbitrage opportunism gives me a massive competitive advantage! I want those who are determined. I want them to “ride” for my team! And I am willing to be flexible, because let’s be honest, I may only be able to afford such talent because they were off the market for awhile and I want them to stick with me for as long as possible. I’ve had several talent wins like this, but the case I like to mention is when I hired a bookkeeper/office manager who had four kids. I have NEVER seen anyone that efficient and present every minute of the 6 hours she spent with us every day. In 30 hours each week she would polish off the work of two full-timers I definitely could not afford. And both she and the company felt like we had a fair arrangement. This is talent arbitrage in action, because it isn’t ever 100% about money!

My secret weapon = talent honeypots!

This is actually a somewhat recent discovery of mine. In the last three years I have mastered talent honeypots. What are they? I look for candidates with a certain set of skills that are often not directly related to the job. My honeypots are usually in a series. Everyone is asking for X-years in certain stack for developer positions, or mastery of leadgen, segmentation, etc. for marketers. These signals are noise everyone else spews. I call it trawling for talent, and your “by-catch” will force you to deploy the most hated “blackhole” for candidate – the ATS (applicant tracking system).

Here are a couple of my sample honeypots (not going to expand into why, since that is a series of articles in itself):

• For operations folks, I like to recruit people who speak 2+ languages, ideally 3+. And I like see at least a couple of years of experience as a server, busboy, pizza delivery person, or retail clerk (returns is my fave).
• For inside sales folks, I like to see past call center experience (and the fact they hated it is a must). Having been a Girl Scout is a huge plus, and early experience making money (paper route, etc.) puts candidates right to the top of my list. If you have all these traits and have never sold on the phone before – PERFECT MATCH! If you have sold on the phone before, I must be sure I can “un-teach” you the bad habits most instill.
• For junior marketing people, a psychology major with minor in English and at least a B+ in a statistics class are key (no statistics taken = no interest from me).

The most commonly used interviewing processes and techniques repel the best people!

Let me come right out and say that if you learned interviewing in your HR class or from a traditional HR person, discard these techniques like they are riddled with plague and infection! The best talent discovery process is one that immerses the candidate in the job they are interviewing for. You practice talent arbitrage by not engaging in outdated yet popular methods used by everyone else.

How else do you improve this process?

1. Don’t just rely on resumes and cover letters. Always do an additional search on your candidates. I often reach out to back channels for references before I even contact candidates for the first time. The effort is worth it and keeps your “nose for talent” disciplined.
2. Mind the context! Embrace introversion just like you would extroversion. Try to understand the candidate before you start judging them. If you have too many candidates, you did a poor job honeypotting – tweak the process continuously, until the flow is just right!
3. Immerse your candidates in their potential role right after the initial pleasantries. It is your job to prepare problems you are actually facing and let the talented individuals show you how he/she would approach them.

And the most important part of talent arbitrage? Everyone mentors and teaches!

I have come across a few companies where members of the executive team have outright told me that they are either not interested or have “no time” for mentoring talent. Molding and mentoring your talented team members is the highest ROI activity. It not only should be expected of every knowledgeable member of the team, but also rewarded immensely. Mentor and teach your talent or your business is as good as dead, since smart companies will poach away every good employee you have.

This all said, I don’t hope, I KNOW what I shared with you in this article will help you find some incredible talent. Let’s go and improve our teams!

Photo credit: Shannon Holman

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The day-to-day execution and administration of a business often takes an excessive amount of time, so the primary reason to augment your team with an Operations Executive is to maximize your CEO’s and other co-founders’ contribution to the enterprise.

I firmly believe that staying true to a vision is best achieved by having a founder as CEO. It is almost always preferable over “hired guns” that can help you execute on the vision but seldom understand it as well and are often too pragmatic. That said, a management hire can be very much a champion of the vision and a true partner with the founder. Good managers are seldom unreasonable, and it takes “unreasonable people” to do the sorts of great things that normal reasonable people wouldn’t consider until you showed them enough proof that it can be done. For that reason among others, boards should try as hard as possible to keep the founder in the No. 1 slot with a good president/COO or an otherwise strong execution team under him or her. This will preserve their instinctive feel for the new space and the new rules.

Legendary Silicon Valley investor Vinod Khosla, the founder of Khosla Ventures.”

Please also read my other articles in this series on what do operations people do and what the common myths are about Operations Executives.

In my experience, the overwhelming majority of the first time founders never knew they needed an Operations Executive. Usually either their investors, board of directors, or advisors were the ones who insisted they get one.

What are the signs that a company is ready for an Operations Executive?:

• The company has started selling to formidable clients and these sales represented a major portion of the company revenues. Anything but an excellent execution and customer experience was just too high of a risk for the company.
• Account management, customer service, and product implementation was becoming the reason customers stayed or renewed contracts. It was no longer enough for the product to be decent and for the founders to work their magic convincing a customer to stay.
• The CEO spent more than 20% of his/her time on the day-to-day management of the business. Operational execution saps a lot of energy and takes away from the #1 job of the CEO – to set direction, run product vision, and be the face of the company. Operational execution also requires a skillset and related ultra-efficiency (and pattern recognition) that is often the polar opposite of what is required to create innovative/competitive products and lead the vision of the business.
• The founders realized they were building a sky-scraper on a small house foundation. What was acceptable for a team of 5 was no longer working for 10, 15, 50, 100, etc. A good Operations Executive will bring the best practices, discipline, and a systematic approach to growing the company. He/she will also build a strong foundation without destroying the one the company was built on.
• Investors or advisors realized a “professional pragmatist” was needed to help the CEO remove impediments on the path of growing the company. Some of the best CEOs and founders are eternal optimists. Even if hell is opening in front of them, they proceed with tireless optimism. But, this is really not a sustainable philosophy.
• In cases where the company has several co-founders who are very passionate about their areas of expertise, they found themselves spending too much time in passionate conversations as the company grew. Therefore, they brought Operations Executive to add some balance.
• There were concerns of plateauing or shrinking revenues, often coupled with shrinking profit margins.

This list could be much longer, but I wanted to focus on the most common reasons I experienced or heard most often.

How about timing?

As with any functional area, realizing that you will need a senior person in 6 – 12 months means you need to start recruiting for this role NOW and immediately snap up the person you think is right when you come across them. This is especially true when the market is hot. With senior level talent, the interview process, negotiations, and transition time your new hire may need to properly leave their current position often takes several months. For example, I have handed in 4-6 month notices before leaving and that was barely enough time for a graceful exit.

Note on the level of Operations Executive:

1. Hire for where you realistically will be in 5 years. Never ever hire someone who has mostly built companies way beyond where yours will be in 4-5 years. If you realistically will be a $10MM business, don’t hire someone from a $200MM revenue business. An Operations Executive with experience in that large of an organization is simply not equipped to help your company. If you find a lot of value in the “big kahuna”, then get him/her on your advisory team.

2. In-betweeners are the best value for your money, if you can find them. In-betweeners are the high-potential talents that are great for earlier stage ventures (pre 100-employee or ~$20MM in annual revenues). These are folks who may not have officially held a COO or VP of Operations title before but have very clearly handled responsibilities of this level.

3. Never hire relatives for any leadership role! Companies with spouses, siblings, cousins, etc. as executives tend to end up as dysfunctional and highly-political organizations.

What should you look for in an Operations Executive?

Please refer to the article I have written before: What To Look For In a Chief Right Hand Person (COO, VP of Operations)

Have questions or comments? Just hit me up on e-mail or connect with me on Twitter.

Photo credit: Tom Magliery 

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Ever since I was a talent agent in the entertainment industry, I have been developing and continuously improving my patterns for detecting gifted people who are more talented than they know. One of my mentors used to say: “catch them before they have a chance to destroy themselves with swollen egos and visions of grander”. After all of these years observing what kind of people do well and what kind end up bitter with their tails between their legs, I can bravely say that I got the pattern down pat. Yes, when I am seeking great people to join my teams, I use methods and patterns to be efficient.

So what are the methods to my madness?

1. I want to know if you have ever worked in retail or as a waiter, waitress, busboy, or delivery driver. Why? Those who have tasted what it is like to be disrespected, stiffed on tips, underpaid, and otherwise poorly treated, tend to exude higher levels of humility, patience, frugalness, and “hustle”. These personality traits make them good team mates, managers, and executives. It does not matter if we are talking about an entry-level marketing person, software developer, or Chief Revenue Officer – the mentioned traits help them unite the team and get past some incredible obstacles.

2. I don’t care what school you went to! I mostly ignore that part of your resume.

Why is education not getting any love? Don’t get me wrong, there are still some schools like Northeastern, Babson, Grinnell, WPI, RISD, DePaul, and Wellesley, to name a few, that have educated folks who have stunned me with their abilities. But I need “stuff” done and “book knowledge” often leads to needless over-thinking, lack of action, and unearned “expertise”. Most of what is taught today in non-science degrees is outdated by the time you are out in the “real world”. And since you were likely already smart before you entered college, you probably learned more applicable skills as a waitress to be say an account manager, than any business or marketing degree you may have gotten. College may help you mature and develop social skills, but it will no longer land you a good job. So, roll up your sleeves and do something.

One caveat is that I do not ignore education with science majors.

There are also certain combinations that work well, for example, psychology for UX and recruiting or arts and journalism for inside sales. There are some others, but you can’t expect me to spill all my “magic”…

So, if you are reading this and are interested in working for one of my teams, please do not hide your service industry job – it may just help you land a position with my team.

Photo credit: Kirk Siang

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Sales is not only a science, but also an art. And we all know there are a lot of bad sales people, just like there are a bunch of lousy artists. I therefore have a great appreciation for excellent sales professionals. Plus, being an operations executive is truly a sales job, and I have to get a buy-in on any larger initiative. I also have been in sales myself, built many systems to make “sales hunting” easier, and recruited my share of sales people.

So where does Darth Vader come in? Blame it on one of the Boston’s best sales masters - Matthew Bellows, founder of Yesware, which is a really useful e-mail tool for sales. I recently went to see one of Matthew’s stellar presentations. Unfortunately, the video isn’t available online yet, but one part of his presentation really resonated with me – his description of the two personality types you have to work with to close a sale – Champions and Darth Vaders. Champions will guide you through the organization and sell your product to others in the company, because they genuinely like you and the product you sell. Darth Vaders, on the other hand, will question you and be skeptical, most likely because they have been screwed before. You see, “Darth Vaders” get hit up by sales pitches every day from the early morning until late at night. They are jaded from sales tricks and are there to make your job very hard. Every business has to have both Champions and Darth Vaders.

I am usually a “Darth Vader” so I totally understand how many of my counterparts think and feel too. We usually handle the money in the company and guard the organization. It is our job to be skeptical and temper the Champions’ enthusiasm, because we will have to own the mess if anything goes wrong. But, we do buy and we buy a lot! It is our job to procure resources and tools for our team. I’m guessing I’ve spent several million in services and products.

So how the heck do you sell to us? Here are the 7 rules you should never ever break or risk being blacklisted or having an extremely short relationship with our businesses:

7. Do not waste our CEOs’ time! Clogging the email or voicemail box of our CEOs gets you nowhere. Not only is their box probably full, half the time our CEO may have no idea about what you are selling. If we told you “no” and you decide to go over us to our CEO, even if you get lucky with one sale, you will now be on our blacklist and will regret it.

6. Treat our gatekeepers like they are the CEO of our company! Not only are they our eyes, ears, and hands, but they are also the reason we can work through an enormous mountains of issues. If you are disrespectful to them, you will have no chance at a sale. Don’t just focus on getting past our gatekeepers, instead recruit them to your side and turn them into your Champions.

5. Be honest! If you tell us nonsense, like you have no competition, or you are not able to tell us where your competitors are better, you lose any chance of a positive report. We are very loyal to honest vendors. Every vendor we have in our go-to contact list is there, because they either sent us to their competitor or told us we should not be buying yet. That goes for both commodities and premium products/services.

4. Dump that script! Since we get hit up with cold calls and emails all day long, we can tell who had what sales training. Consultative selling, AIDA, AIDCA, Sandler, etc. – we know when you are running each technique on us. This just gets you labeled as a rookie, and we care about our companies too much to let rookies touch them. Sales should be a conversation with lots of listening – you can’t script and rehearse that.

3. Keep your word! This is one very common complaint! Don’t forget to call when you say you will, send us the information we requested, deliver scopes and quotes on time, etc.

2. Listen a heck of a lot more than you talk! Ask us the kind of questions that set the context first, then delve deeper into our “pains”. Your consultative perception of our “pain” is usually nothing like our real “pain”. If you yap too much about your “benefits”, you may just miss the sale.

1. Do your homework! Look at our websites, media articles, D&B (which has more info than we want out there), and social media presence. The more you know about us before you call, the more we will feel you invested in us, and this does make us want to talk to you. In addition, if you were respectful to our gatekeepers, they may have already provided you with a lot of very relevant information.

BONUS MATERIAL: If you are a female, for the love of anything sacred you have, please do not think a short skirt or a stuffed bra will get you a real sale. This is not college. We have businesses to run, so please show some class! The same goes for men trying to flirt with female employees in our companies – save it for the bar scene! We see stuff this like this every day and consider it a liability to our company – we want nothing to do with it.

Photo credit: Helmut Edlmayer

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As my regular readers know, I am a startup operations veteran with “battle scars” from 9 startups (co-founder in 2 and early employee in most). I have acquired a PhD in operations from the school of hard knocks after years of being around some very smart people and working on difficult problems. Today, I am going to address some common misconceptions about startup operations executives. Let’s get to it!

First and foremost, let’s get the lingo and caveats out of the way, since many myths start and won’t die because of a substantial lack of clarity.

• What’s the difference between a COO, VP, Director of Operations, or GM?

– Depending on where your company is based, how it is organized (LLP, LLC, Inc., etc.), and/or what industry you are in, one or most of these titles may be used. They’re basically the same role, so for the purposes of this article, they will be rolled into up into the title, “Operations Executive”.

• What’s the Definition of “startup”?

- Since there is no consensus of how long a company gets to call itself a startup, let’s just leave it at that. I do, however, make a distinction between early stage pre-product/market-fit and sustainably scalable startups and rapidly growing startups, since the problems that need to be solved are often very different between them.

• What does an Operations Executive do?

- Though this may differ slightly company-to-company, he/she is often responsible for and is reported to by finance, sales, marketing, business development, IT, DevOps, and people operations (including HR).

Now that all our bases have been covered, here are the most common myths I come across:

MYTH #1: A CEO should be able to handle all business execution alone.

In a truly early stage startup, before product/market fit and while the company is operationally simple, a founder-CEO absolutely should be able to handle everything. However, once the company starts hitting milestones that make the company more operationally complex (see the next article in the series: Signs It Is the Right Time to Hire an Operations Executive), the personal capacity and attention of the CEO and/or co-founders becomes overcrowded with “trees” rather than “forest” issues.

In this analogy, the “forest” issues are high level goals like setting the direction for the company, the culture, and the product. These areas always start suffering first, because the day-to-day operations (“trees”) issues have a tendency to suck up a lot of attention.

Just like a seasoned developer can create a better product in less time, a great Operations Executive can recognize patterns you may not; we have armies of specialist vendors, and networks of subject matter experts we excel at tapping into, which can make the company noticeably more efficient and effective while also giving the CEO time to focus on what they do best (leading and setting the vision).

MYTH #2 Having a CFO is enough.

Investors in your seed and A rounds often require your company hire a (usually part-time) CFO as a condition of their investment. Investors either want someone with a much stronger financial skillset or a non-founder overseeing their money. But this is something that happens mostly in early pre-product/market fit startups where an Operations Executive is not needed yet. Once the company starts getting traction and needs to scale, it is easy to fall for this myth, since Myth #1 has probably already taken hold.

MYTH #3: There are tons of companies with $10M + revenues that don’t have an Operations Executive.

When this happens, it’s usually because the CEO is the Operations Executive and thus the company operator. However, this also means that innovation, product, and vision is likely handled by (other) co-founders who wanted to take roles that did not require being the face of the company with associated PR duties and an endless barrage of attention and scrutiny. One person can’t lead operations, while also leading vision and product, because one or all of those areas will suffer from lack of proper attention and focus.

MYTH #4: If a co-founder already has the COO title, you don’t need an Operations Executive.

Often, when there are 2+ co-founders, the most extroverted, best in sales, and/or most dominant co-founder takes the CEO title, and the more inside-of-the-business-focused one takes the COO title. Unfortunately, in most cases this COO tends to be an expert in other areas and may not only lack the experience and skillset needed, but also abhors the duties of an Operations Executive. Those of us who head operations are used to these situations, which is why you see us take the VP or Director of Operations title. In the end, these aforementioned COO co-founders end up taking a new title more in line with their expertise and passions.

MYTH #5: Your valuation will be lower if you have a COO.

This myth has nothing to do with Operations Executives, but rather is rooted in co-founder/investor politics. I have heard this myth with CMO, CTO, CRO, and other leadership titles. Yes, investors will stay away from or reduce valuation of a company if they see that founders, who currently hold the mentioned executive titles, show an unwillingness to give up their leadership roles to better qualified non-founder talent. That said, Operations Executives actually increase the valuation of the company, because they are experts in three major company value drivers – the ability to recruit, develop, and retain the best talent, optimize profitability/revenues, and scale the company sustainably.

Whatever the myths and misconceptions are, every company that is sustainable and profitable has an Operations Executive on their team.

It may take the founders realizing their revenues are flat or shrinking no matter the effort or a major traumatic event to get an Operations Executive, but they all do in the end. As one of my CEO friends likes to say: “just like behind every great king there is a great queen, behind every great CEO is a COO covering his/her back”.

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One time employee referral bonuses need to go the way of the dodo. They are an antiquated reward system that motivates the wrong things. Yes, some of the most well known companies use them, but these companies end up hurting both themselves and also the business community. Even the biggest morons can waste investor/company money, so enough with these one time referral bonuses!

Before I suggest a solution, let me tell you why one time referral bonuses are a waste of money:

1. One time large rewards do not work! The effect of the bonus wears off by the next paycheck. I’ve seen this happen many times – it is often like flushing thousands down the toilet.
2. The person referring the candidate does very little to really earn the bonus. An employee looking at their contact list and having a couple of conversation is not exactly worth $2000, $4000, or even $10000…because their responsibility ends there. The person referring the candidate, along with the operations team, should also be involved with on-boarding, teaching company culture, retention, and continued satisfaction with the company.

But we all need help in recruiting talent for our teams, and the people operations team needs assistance helping new employees settle in and do well, etc. So here is a better way:

Institute a substantial employee referral dividend. It takes about $10K-$15K in resources and cash to replace each employee who leaves the company. On top of that, since often a new hire may get higher compensation, you may need to hire one full-timer and one part-timer to replace the lost output, etc. So why not increase the stakes and give a $5K annual bonus per employee referred for as long as both the referrer and the referee are employed with the company. The bonus should be paid each year on the anniversary date that the referred employee joined the company. Why such a large bonus? Because $20K over a 4 year tenure is a small price to pay. I estimate you will get a 3X ROI on that money.

Why 3X ROI?

1. Your talent funnel is going to be much fuller without paying any outsiders. I like to keep money in the company. Plus, outsiders send you mediocre people for a much higher fee.
2. Employees are more motivated to make sure their fellow employees are the right people to join the company and that they are productive and happy after they join. The company saves money because less operations people need to be hired.
3. Your own people become talent managers and help catch performance problems or dissatisfaction with the company before operations or management does. The earlier you discover a problem, the cheaper and easier it is to solve.

What are the risks?

1. There is a risk for company diversity since the friends and acquaintances of your employees may all belong to the same demographic, alumni group, etc. The way you mitigate this is with a strong company culture and value, and education on the undeniable power of diverse teams.
2. There may be resentment if an employee’s buddy gets fired and that employee loses his/her bonus. This risk is minor though, since a higher quality talent pool will reduce the need to fire for lack of performance.

What do you think? Connect with me on Twitter.

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Your operations people are the reason customers are happy, vendors continue providing you with services, and employees have enough resources. Operations team is the “A-team” of vision logistics and their #1 mission is to take care of the organization (feed it, protect it, and maintain it). Not all small companies and startups have operations teams, since a company has to mature to have one. In addition, operations is functionally incorporated into other divisions in many companies and only officially becomes separate once the company becomes a sustainable business.

“It isn’t the mountains ahead to climb that wear you out; it’s the pebble in your shoe.” - Muhammad Ali

That quote embodies my motto and is what I teach to those who want to become dedicated operations professionals. To further expand upon the analogy, it is much easier to climb a mountain when someone has already laid out the map, obtained all the supplies, made sure weather is optimal, and has an emergency response ready to go, if needed. When all the little details are taken care of, then you only have to focus on obtaining your peak physical condition – the logistics help enable your success. Operations is probably one of the most demanding functional areas, because the company never stops working and you rarely do too (just ask my wife about last decade together and how companies are often like my 2^nd family).

So what does the operations team do for all the different stakeholders in a company?

Employees:

• Makes sure the company has a healthy amount of talent in the recruiting pipeline. The HR/Human Capital/Recruiting part of the operations team supplies talent when the team needs a new member. Is there to solve all HR issues.
• Supports every functional area that needs resources and support. The operations team is there to be a concierge to your needs – they are your internal support A-team and help prevent and solve problems.
• If a company is technology heavy, there may be an internal technology operations team. Sometimes it is kept together in the DevOps team (my favorite setup) and sometimes the internal IT operations team is separated from the product/technology operations team that is dedicated to exclusively supporting the product/service.

Founders & executive team:

• Leads business predictability by providing forecasts, metrics, KPIs, and accountability in general. Operations people live and breathe numbers. If you want most truthful numbers, ask your operations team for them.
• Provides financial accountability and business predictability if finance is part of the operations team.
• Minimizes and neutralizes legal and other “bulls-eyes” on the company. The operations team will always have a member or two who is well-versed in laws and regulation, and they help the company navigate this environment. You can’t mess with a company that has a strong operations team, because you won’t get a chance to get close enough to hurt it!

Customers:

• Ensures the company’s investment in acquiring every hard-earned customer is well tended to. This is where the operation team is the best friends of the revenue team (sales and marketing) – their goal is to make customers happy!
• Are the first ones to detect cancerous customers and recommend they are fired so the company can focus their resources on those who help the company grow rather than those which drag them down.

Vendors, suppliers, contractors:

• Provide the same management and services as are supplied to customers since people who service an organization are as just as important as the customers.

Every company is different, but usually the “ingredients” are the same and just the ratios in each “recipe” are different.

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Ever since I discovered a phenomenal app called Evernote (it works on all my devices!!!), I have been diligently documenting the lessons I learn each day. I also write drafts of blog articles whenever inspiration hits. If you don’t have Evernote, get it; it will change the way you work. That said, in the last couple of weeks, several conversations with my consulting clients and venture-running friends motivated me to dig into my notes and produce this post.

Since people management seems to be the dominant discussion I am having these days (sales operations and marketing automation are a close second), here are 12 lessons I’ve picked up along the way about leading and managing employees (in no particular order):

• “Business is business and should not be personal” is BS sold to you by “thought leaders” without any experience what your team will do for you, if you genuinely care about them and treat them with compassion. Your employees are humans – they have emotions and families. Things happen, and if you can’t deal with that, you have no place in the ranks of leaders.
• Contrary to popular belief, the higher your rank or importance in the organization, the more service requirements you have. Dictating and acting in privilege no longer works, unless you want to have corporate cockroaches on your team. Lead by example. If you want people to do something or act in a certain way, you should be the first one to do it and embody it 24x7x365.
• It doesn’t matter if you are hiring a marketing executive or an intern, if you don’t feel they are smarter than you (note: I am talking about smarts, not experience), don’t hire them. I have had some fresh out of school interns share wisdom with me that I still use to this day.
• Don’t wait to accumulate major evidence of someone being unethical – fire them immediately, even when it is just your gut setting off the red flags (caveat: you have to rely on data you have, not on what you’ve heard via hearsay). In my experience, waiting for more evidence costs the company dearly.
• Settling for someone because you are desperate (I see this every day now for sales, marketing, and tech talent), will cost you more in damage to the company than work not being done. Bust your behind to fill the top of the candidate funnel so you’re never desperate.
• Peoples’ work ethics and general attitudes do not change. You can’t turn a lazy employee into an efficient employer or a brown-nosed employee into a productive member of the team. Either don’t hire them, or replace them ASAP!
• Investments in a better workplace atmosphere and quality of life pay at least a 3x dividend. Noise levels, comfort, light, quality of air, and break areas matter!
• If you put your personal needs, as a founder, executive, or manager, higher than those of your employees, don’t complain when people become disengaged and will not go above and beyond for you. Don’t make someone miss family time because your deadline suddenly became shorter or choose an office location because it is a shorter commute for you. Those who look at themselves as servant leaders get the highest output out of their teams.
• If you let your customer or vendor treat your employees like crap, you are communicating a very bad message to your team. It does not matter how strategically important your customers or vendors are, your employees come first, then the company, then your customers, then your investors. In my experience, this is the magic formula to building a profitable business with happy employees, customers, and investors.
• Stop falling into “girlfriend/boyfriend syndrome” of fixing your people. Invest in your team, amplify their strengths, and work to offset their weaknesses operationally.
• Always have a “rainy day” fund in case you meet someone really talented you know you will need six months or even a year down the line. Otherwise, because you will eventually get desperate, you will be paying huge sums to outside recruiters for mediocre talent.
• Even a top-rated MBA program will not turn an incompetent person into a business maven. All it will do is increase their incompetence and their illusion of prudence. Don’t ever rely on someone’s education to predict their performance.

Photo credit: Chris Ingrassia

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So here is my question for the many organizations that have an unhealthy fascination with improving the weaknesses of their talent: How was Michael Jordan in baseball?.. Exactly!

I started my career as a talent agent. Yes, a talent agent in the entertainment industry. I even went to the top school in the field, Columbia College Chicago, to study under some of the luminaries. Even though I transitioned to the technology industry half way through my career, I picked up a lot of wisdom from several of my mentors/teachers including Irwin H. Steinberg (founder of Mercury Records and CEO of then 2nd largest record label in the world – Polygram) and Joey Edmonds (talent agent who discovered grew some of the most admired comedians). I apply their teachings to my work every day: the greater the strength of an individual’s talent, the more likely he/she has a big weakness lurking somewhere – that is the price you pay for genius. If someone is phenomenal at getting tens of thousands of people to shell out $100s to see them for couple of hours in a stadium, it is likely they have several other areas where they perform poorly. As a talent manager, your job is to find those weaknesses and work with or even neutralize them. Now it is also true that if someone is mediocre at everything, they are less likely to have these large weaknesses… but I don’t care to work with people like this, since life is short and I want to learn from people around me every day.

You see, talent is talent.  It does not matter if you are making hundreds of thousands of people scream your name as you sing or if you have the same number of people look at you as the creator of the most useful application they have on their smartphones. Great data scientists, product managers, marketers, and software developers are a lot like great musicians, comedians, dancers, and sculptors.

From a business founder or executive point of view, it is also a much better investment strategy in our people. Peter Druker, the man who coined the term “knowledge worker”, developed the management by objectives methodology, and is the author of 30+ management and economics books said: “It takes far less energy to move from first-rate performance to excellence than it does to move from incompetence to mediocrity.”

Dealing with weaknesses is not a people development problem, but rather an operational problem. It is my job, as a chief of staff, to figure out who fits where in the grand company talent matrix and to work with my team on neutralizing the weaknesses of those that may hurt us. We either put workflows, processes, and tools in place and/or find additions to our teams who are geniuses in the areas where we have weaknesses. This is something you do from day one, and this job never stops. So much so, that at some point it becomes a separate leadership role.

Bottom line: talent comes with a price – gladly pay it, because it likely has the highest return on your investment. And please, for the sake of sanity (and talent retention), stop getting into this girlfriend/boyfriend syndrome of trying to “fix” someone.

Photo credit: Philip Kromer 

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