You can follow @skmurphy to get them hot off the mojo wire or wait until the end of the month when these quotes for entrepreneurs are collected on the blog. Enter your E-mail if you would like Feedburner to deliver new blog posts to your inbox.
Archive for May, 2011
Memorial Day is when we commemorate those who died in the service of our country. I offer two quotations related to men giving their lives in battle for you to meditate on.
First a famous stanza from “Ballad of Sir Andrew Barton”
“Fight on, my men,” says Sir Andrew Barton,
“I am hurt, but I am not slain;
I’ll lay me down and bleed a while,
And then I’ll rise and fight again.”
Next the closing sentences of Lincoln’s Gettysburg Address:
It is for us the living, rather, to be dedicated here to the unfinished work which they who fought here have thus far so nobly advanced. It is rather for us to be here dedicated to the great task remaining before us—that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion—that we here highly resolve that these dead shall not have died in vain—that this nation, under God, shall have a new birth of freedom—and that government of the people, by the people, for the people, shall not perish from the earth.
SKMurphy’s Book Club for Business Impact provides actionable insights for the entrepreneurially minded, whether you are trying to bring change to a market or an organization. It’s a webinar / call in with a panel that has a roundtable discussion with the audience. Everyone will have a chance to contribute their experiences and lessons learned implementing ideas from a recent business book or article. I hope you can join us.
SDForum June Event Information:
Title: SDForum Workshop Series “Networking for Lifetime Career Success”
Date: Tuesday, June 28, 2011, 7:30 AM – 10:00 AM
Description: During times of change, the ability to naturally and effectively network to identify new opportunities and develop professional relationships can be critical to success. In this interactive session, Next Step CEO, Jennifer Vessels, will provide proven tips for successful networking that attendees can put into practice immediately at the event.
This hour long program will include tips to you can use immediately to:
- Create a memorable first impression.
- Develop a compelling elevator speech to gain attention and be remembered.
- Leverage ‘keys to networking success’ to stand out and be noticed (positively).
- Utilize follow-up as foundation for long term relationship building
With time for networking, interaction and feedback built into the program, all participants will leave with an action plan and approach they can most effectively utilize for networking.
Confirmed Speaker: Jennifer Vessels, CEO of Next Step
Location: White & Lee, 541 Jefferson Avenue, Suite 100 Redwood City, CA 94063
Registration Link: http://www.sdforum.org/workshopseries
I took part in a number of great conversations at today’s Startup Lessons Learned Conference, probably the most common–and most vexing–issue that was discussed was whether to give up in the face of modest success. I had perhaps half a dozen conversations around “We’ve come this far and have paying customers but are not sure we should continue on the path we are on.”
This is a very tough issue to manage. Here is a synthesis of the answers that I gave.
- When you make the decision to commit to a course of action write down what success and failure looks like and estimate how far you should be in a few weeks to a few months (depending upon the scope of the decision). Plan for two or three re-evaluation points. Only evaluate whether you on track on a pre-defined schedule unless something extraordinary happens. This prevents a very painful loop where every few days you are wrestling with whether to continue or not.
- Perhaps every two to four weeks but at least once very three month, assess where you are and what you have learned that you have incorporated into your process and approach. Periodically assessing what you have learned and how you have improved is another way to immunize yourself against doing the same thing over and over again expecting a different result: you should at least be making new mistakes.
- Talk to peers and advisors. One benefit of peer to peer discussions with other entrepreneurs is that they give you a chance to get different perspectives on your situation (often another entrepreneur may bring a valuable emotional distance that navigates the twin risks of giving up too soon and persisting too long).
- Be cautious in throwing away paying customers.
- If you have had success in several areas or with seemingly different customers look for a common thread or underlying connection.
- “Stubborn genius” is a tautology, but “stubborn fool” is as well, alas.
For the most part I see folks giving up too early far more often than persisting well past when they should abandon an idea. As Ringo Starr advises “it don’t come easy” and I see folks expecting a quick viral pop in two or three months giving up much much more often than a team persisting into their fourth year on an idea that’s clearly going nowhere.
But it’s possible that you have “climbed a small hill” and are in a market that is too small to support your firm.
Patrick Vlaskovits blogged about a related topic in “I See Dead Startups.”
I will be at the Startup Lessons Learned 2011 conference tomorrow. If you are there in person please say hello, I am always interested in meeting one of the baker’s dozen who read my blog.
At this point the conference is sold out but it is being streamed to something like 100 locations, see http://www.sllconf.com/streaming for a location near you.
The three talks I am most interested in hearing tomorrow are
- 10:20AM to 10:40AM PDT “Votizen Case Study: How and When to Pivot” Dave Binetti from Votizen, who is always candid and insightful about his entrepreneurial journey.
- 3:00 PM – 3:30 PM PDT Steve Blank’s Keynote. Steve Blank is always thought provoking and I expect nothing less from this keynote.
- 4:50 PM – 5:10 PM PDT “Groupon Case Study: Using Lean Startup Principles to Manage Hypergrowth” by Suneel Gupta, Groupon. I grew up in St. Louis so I was glad to see they could find room at the end of the day for a firm from “flyover country.” I don’t know much about Groupon but I understand that they have met with some success in the marketplace.
- Dave Binetti did not disappoint, his slides are up at http://www.slideshare.net/dbinetti/lean-startup-at-sxsw-votizen-pivot-case-study
- Steve’s slides are at http://www.slideshare.net/sblank/when-the-boardroom-is-bits-052111
- Gupta’s talk ran long but didn’t seem to contain any lessons learned.
Here are a couple of rules of thumb you may find helpful in thinking about price, value, and your prospect’s perception of risk.
“The only certainty is a reasonable probability.”
Edgar Watson Howe, “Country Town Sayings”
“An approximate answer to the right problem is worth a good deal more than an exact answer to an approximate problem.”
Startups see fluid opportunities in dynamic environments, but no certainties before opportunities pass or the situation changes.
You have to act when you are about 60-70% confident, even 80% can be hard to achieve.
If you have all of the facts it’s not a decision it’s a choice.
“The shrewd guess, the fertile hypothesis, the courageous leap to a tentative conclusion–these are the most valuable coin of the thinker at work. But in most schools guessing is heavily penalized and is associated somehow with laziness.”
Jerome S. Bruner
Tristan Kromer, who blogs at Grasshopper Herder, offered some great insights on business models on the Lean Startup Circle mailing list in response to a question about how to select which idea to focus on for your startup
There’s nothing wrong with a services business.
It’s harder to scale, but there’s nothing in the customer development handbook that says only billion dollar scalable software companies are worth doing.
Plenty of people get filthy rich running pool cleaning businesses.
I think a lot of people look to software businesses with some idea that it will somehow be easier because there is no inventory and you can just build one product for a million people.
Personally, I think that’s an illusion. There are just different issues. There is still inventory (people), assets (ideas), a manufacturing process (coding), etc.
Starting out as a service business, or primarily as a services business, does not preclude you from becoming a product oriented company later on. I hear too many entrepreneurs worrying “that approach won’t scale” when they should be more worried “that approach is unlikely to find any customers.”
Also, if there are complex workflows involved, using a service business to prototype and explore what capabilities will actually be required (and used) is much much faster than trying to get it all coded.
I will often hear folks say “I think I can get a lot of users, I know that there is a market for this.”
I worry because a market requires customers not just users: you can tell who your customer is because they pay for your product or service.
When you say to yourself that “there is a market there” you need to identify who the customer is.
The IRS defines a business without profits as a hobby.
If you have no revenue it’s very difficult to make a profit.
There is nothing wrong with a hobby but you should consider if that is what you want to spend time on.
A special announcement for our valued readers
SKMurphy introduces a new service, Book Club for Business Impact. This is a call-in virtual discussion group that leverages the best ideas from business experts, best-selling authors, and thought leaders. Listen to the live action group review and discuss prominent books and articles that will inspire you to take action of your own – now.
Listen to our May 11, 2011 kick-off discussion, and find ways how to apply Dan Roam’s “ The Back of the Napkin: Solving Problems and Selling Ideas with Pictures” with your business practices.
Up next on our schedule includes:
- May: Peter Drucker’s seminal article “Managing Oneself”
- June: “You Need to Be a Little Crazy: The Truth about Starting and Growing Your Business” by Barry Moltz.
- June: “3-D Negotiation Powerful Tools to Change the Game in Your Most Important Deals by David A. Lax and James K. Sebenius
Join us, share your questions, and learn how you may start using ideas from these books immediately.
We hope you will join us and feedback is always welcome on our event. Use the discount code “GuineaPig” to sign up at no cost now.
|Call-in Book Review recorded on June 22, 2011Steve Mock, Francis Adanza and Sean Murphy recap Business Impact Book Club on “3D Negotiation” a 2003 Harvard Business Review Article by David Lax and James Sebenius.|
Powerful Tools to Change the Game in Your Most Important Deals
By David A. Lax and James K. Sebenius
This Harvard Business Review executive summary provides a richer content for negotiation.
Share your story –
Leave a comment below
Additional Book Reviews
“You Need to Be a Little Crazy: The Truth about Starting and Growing Your Business”
by Barry Moltz
Advice about starting a business never sounded like this! Beginning with “you must be crazy,” serial entrepreneur and angel investor Barry Moltz offers the true insider’s scoop on new business start-ups.
With doses of irreverence and humor, the return-to-basics guide focuses on what comes before the bottom line.
Share your story –
Leave a comment below
Additional Book Reviews
Customer understand when they have unmet needs, persistent problems, and goals and risk. They are normally very good at describing their problems and constraints on a solution but less accurate in fully specifying a solution.
Whether it’s in a conversation with your team, with prospects, partners, or customers, the ability to sketch and to encourage them to collaborate on a sketch of the issue that you are discussion can be very helpful. It can be on a white board in a conference room, on a sheet of graph paper, or even the proverbial “back of the napkin.”
One good book that has a number of powerful yet simple models for sketching problems is Dan Roam’s “Back of the Napkin” (available on Amazon at http://www.amazon.com/Back-Napkin-Expanded-Problems-Pictures/dp/1591843065 ).
We are offering a webinar on lessons applied from the book to customer development on Wed-May-11 at Noon PDT http://www.eventbrite.com/event/1574022945
This is part of a series of webinars on popular books, articles, and blog posts that will involve a panel discussion of actionable insights and practical take aways for your startup. Joining me for this webinar are Charles Baugh, who was formerly the director of Knowledge Products at Cisco, and Terry Frazier, the CEO of Cognovis.
I hope that you can take part, if you would like to suggest a book or article that has given you practical insights for your business or take part in a future webinar as a panelist please contact me directly.
“The only certainty is a reasonable probability.”
Edgar Watson Howe, “Country Town Sayings”
We help clients to interview prospects in the early market for customer discovery purposes, we also help them have serious conversations with early customers periodically to capture their evolving perspective on the client’s offering. Sometimes we will do this on the client’s behalf with their permission but without their direct involvement in the interview, we find that prospects and new customers are more willing to provide useful but critical feedback when it’s indirect. This is particularly true for the “loss” side of win/loss analysis.
We use a wiki with a good search feature, CentralDesktop, but PBWorks, Twiki, or many others would work as well. We want to be able to add and interlink pages in an ad hoc fashion: we put each interview in it’s own page and cross link them as appropriate. We also want to be able to find the information later, which is why good search is important.
We document each conversation including location, time, date, people involved, and any other facts or attributes that made it memorable or might be used to search for it. I find that it’s easier to recall the rough time frame (e.g. month and year), the location, and who took part from our team after a few weeks have passed than the person’s name if we only had one conversation.
If the interview takes place over a skype text chat or other IM text chat we post the transcripts into the wiki page along with notes. It’s worth taking some time to clean up typos and add synonyms to make it easier to find the passage again. Same thing for e-mail threads, we clean them up and post them into a unique page.
Our goal is to capture key comments and phrases that help to illuminate goals, needs, constraints. Wherever possible we try and use the customer’s words. This constitutes a raw store of narratives that the team can consult over time.
We create separate pages for hypotheses, plans, features, etc.. and give everyone on the team access.
In the early market we focus on a few key needs and the capabilities or features that are critical in supporting them.
When I worked at Cisco I had to develop MRD’s using a template that led to writing 50-100 pages or more. One or two pages that have links to more context is frankly more useful. You don’t need to exhaustively analyze what you have collected to be able to move forward; keep the interview notes and re-read them, adding links to related notes and giving issues/ideas their own page.
This approach scales from dozens to perhaps a 100 interviews. There are other commercial tools for release planning when you have a large installed based that will give you more analytic capabilities (e.g. Accept Software, there are many others) but I find the wiki approach allows us to capture key narrative fragments easily and link them as our understanding evolves.
We often build simple spreadsheet models to capture hypotheses and put numbers (and ranges, e.g. high, medium, low) for the parameters of customer costs and values that the proposed solution may offer. A simple ROI model based on customer attributes helps with pricing and focuses your attention on who is likely to gain the most value from your offering.
One tool we are starting to evaluate is Dave Snowden’s Sensemaker Suite, for more complex projects the SmartOrg tools are worth a look but are probably more useful for larger firms with a portfolio of products.
One other advantage to Central Desktop is that each customer’s information is kept in a separate private wiki and we can transfer ownership to your team at the end of the project if you would like to continue to use it.
Here are two other blog posts about gathering stories and feedback from prospects and early customers:
- “The Best Way to Get Feedback from Early Customers is a Conversation“
- “The Best Feedback from Your Early Customers is a Story“
If you would like our help in structuring or interpreting what prospects are telling you, please feel free to contact us and we can put together a project based on the scope of your needs and your timeframe. We can also help with rehearsal and de-brief and can take part in face to face customer interviews in Silicon Valley or anywhere on the phone.
Tom Van Vleck has a great collection of software engineering stories on his site. One particularly good article is “Three Questions For Each Bug That You Find” which offers the following key observation:
The key idea behind these questions is that every bug is a symptom of an underlying process. You have to treat the symptoms, but if all you do is treat symptoms, you’ll continue to see more symptoms forever. You need to find out what process produced the bug and change the process. The underlying process that caused your bug is probably non-random and can be controlled, once you identify what happened and what caused it to happen.
Before you ask the three questions, you need to overcome your natural resistance to looking carefully at the bug. Look at the code and explain what went wrong. Start with the observable facts and work backwards, asking why repeatedly, until you can describe the pattern that underlies the bug. Often, you should do this with a colleague, because explaining what you think happened will force you to confront your assumptions about what the program is up to.
These three questions take you beyond root cause analysis and corrective action for the particular problem.
- Is this mistake somewhere else also?
Look for other places in the code where the same pattern applies. Vary the pattern systematically to look for similar bugs.
- What next bug is hidden behind this one?
Once you figure out how to fix the bug, you need to imagine what will happen once you fix it.
- What should I do to prevent bugs like this?
Ask how you can change your ways to make this kind of bug impossible by definition. By changing methods or tools, it’s often possible to completely eliminate a whole class of failures instead of shooting the bugs down one by one. The bug may be a symptom of communication problems in the programming team, or of conflicting design assumptions which need discussion.
I think this same approach is applicable for debugging not only software development issues but other processes in your business:
- lead generation
- selling and closing sales
- customer engagement and on-boarding
- customer service
- systems administration
- financial operations and cash flow management
Postscript: Van Vleck’s motto is: “You learn something every day, unless you’re careful.”
I included it in the July 2008 Quotes for Entrepreneurs because I find most days very educational.