If “Cold Calling” is Your Answer Please Reconsider

Written by Sean Murphy. Posted in Lead Generation, skmurphy

Q: I am launching a new live chat service and trying to decide the best way to acquire new customers from cold calling, email marketing, social media outreach by posting content to Facebook pages. What would you recommend?

Technology vs. Business Model

A live chat service is a technology, what is your business model?

Who is the Customer? What Is Their Need?

In particular who is the customer and why aren’t they using one of the several dozen live chat services already available? To determine the best tool for acquiring a new customer you have to have a clear hypothesis for who the customer, their need or pain point, and how your offering is differentiated from other alternatives already available to them.

Cold Calling Is Almost Always The Least Effective

The question cannot be answered in the abstract although “cold calling,” despite it’s popularity, is almost always the worst possible customer acquisition approach as a pure method. If you can make a “warm call” either via an introduction or because a prospect has indicated or expressed interest then that’s has a much higher chance of success. But that normally means you have to use multiple outbound methods (e.g. email marketing, SEO, SEM, advertising,..) to generate that interest and warm up the call.

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Entrepreneurship As A Calling

Written by Sean Murphy. Posted in 1 Idea Stage, skmurphy, Startups, Video

A documentary on entrepreneurship as a calling that I found very compelling was “The Call of the Entrepreneur” produced by the Acton Institute. It addresses both practical and spiritual aspects of entrepreneurship from the point of view of three very different entrepreneurs:

  • Brad Morgan, a dairy farmer in Evart, Michigan who transforms a failing farm into a successful dairy and compost company.
  • Frank Hanna, a merchant banker in New York City who explains how entrepreneurship transforms the economy into a positive sum game.
  • Jimmy Lai who grew up in Communist China and then Hong Kong, emigrating to New York to found retail and media companies.

What Are You Throwing Away That You Could Be Selling?

I found Brad Morgan’s story to be the most interesting, as he says, “You put your butt in a corner, you would be surprised what you could achieve.” Certainly a familiar feeling for most bootstrapping entrepreneurs, sometimes more than once a month in the early going. The documentary stresses the creative problem solving aspects of entrepreneurship. When Morgan figures out he can convert an excess of cow manure into a compost–so that he can sell it instead of having to pay to have hauled away–it’s a light bulb moment. He is down to earth and pragmatic, and his story offers two lessons for bootstrappers of all sorts:

  • what are you throwing away that has value to someone?
  • What is someone else throwing away that you could recycle or re-purpose into something valuable?

Trailer For The Call Of The Entrepreneur

About The Acton Institute

The Mission of the Acton Institute is to promote a free and virtuous society characterized by individual liberty and sustained by religious principles.

The Acton Institute for the Study of Religion and Liberty is named after the great English historian, Lord John Acton (1834-1902). He is best known for his famous remark: “Power tends to corrupt, and absolute power corrupts absolutely.” Inspired by his work on the relation between liberty and morality, the Acton Institute seeks to articulate a vision of society that is both free and virtuous, the end of which is human flourishing. To clarify this relationship, the Institute holds seminars and publishes various books, monographs, periodicals, and articles.

Where To Buy DVD and Study Guide

Please note that these are not affiliate links, it’s just much cheaper to buy from the Acton Institute directly than Amazon or Barnes and Noble.

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Tristan Kromer on Testing Customer and Value Hypotheses

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, 3 Early Customer Stage, Customer Development, skmurphy

These are excerpts from  Episode 9 of Outlier on Air: Tristan Kromer, A Lean Approach to Business.  They are in the same sequence the took place in the interview but a number of stories and asides have been omitted to focus on what I felt were some extremely valuable insights from Tristan Kromer on clarifying and testing customer and value hypotheses.


Podcast is dedicated to Disruptors, Rule Breakers, and Big Thinkers

Melinda Yeamen (@melindayeaman): Today, we are going to talk about having a lean approach to your business. We’ve got Tristan Kromer. He is a freelance lean and Innovation coach, and he runs the Lean Startup Circle. This is a grass roots community based around lean startup principles, with Meet-Up groups worldwide. This is actually a follow-up interview to a written interview that “Outlier Magazine” did, Tristan, you are joining us from Silicon Valley, is that right?

Tristan Kromer (@TriKro  | blog):  That’s right. I’m sitting here in the SOMA area of San Francisco right now, and I have my offices in this area.

Tristan Kromer Started Like Everyone Else, Failing Repeatedly

Melinda: Before we go into Lean principles, I want to get to know more about you personally: what brought you up to Lean Startup coaching and what drives you to do it.

Tristan: How I got to Lean Startup is relatively straightforward. It’s the same way that most people get into it, which is that you try something new, whether that’s in a large company or a small startup of your own.

You start out with this wonderfully egotistical idea that you know what you’re doing, and that you alone can provide that vision, and tell the customers what they need, and then you fail repeatedly to deliver on that promise.

Then, after banging your head against the wall enough times you start to think, “Maybe I’m not so visionary. Maybe I’m not Steve Jobs 2.0, and it’s time to try something new.” Most of us who have become real Lean evangelists in the past few years have struggled desperately with our own projects and suddenly realized that there was perhaps a better way. A way that is more grounded in reality.

  • Test out those ideas on a small scale and seeing what sticks and what doesn’t. I’ve worked with larger companies in the past. I worked in the IT security industry for five years in Germany and Taiwan and Vietnam and Switzerland. I worked in the music industry in the US before that for 10 years.
  • Identify the critical assumptions in your business–whether that business is a band, a restaurant, an IT company, or a high-tech company.
  • Test them, validate them, and then move on. Just that methodology has just proven more successful than the “Field of Dreams” — the “build it and they will come” approach.

That’s really how I got there –by failing repeatedly and–by trying to recognize the things that worked when I did succeed and the things that inevitably wound up bringing me to failure.

A Day In The Life Of A Lean Startup Coach

Melinda: Tell me a little bit what your life is like. What does your life look like as a Lean Startup coach?

Tristan: This morning I woke up at 6:00 AM to talk with a team at company I’m working with in Switzerland. They want to implement Lean Startup practices but in a large company they also have to worry brand, and political fallout from other teams. I am helping them do small-scale innovation in a large company environment?

Since then, I’ve been working a lot of the day on Lean Camp,  an unconference the weekend right before the Lean Startup conference. An unconference offers an open space format like BarCamp, this one will gather a lot of Lean Startup practitioners to discuss Lean methodologies, tactics, and tips and lessons learned. I’ve been spending all day with our massive volunteer team trying to get that organized.

Melinda: I ask you because our audience is specifically entrepreneurs and startups. We all have these major aspirations, and once we take that leap from the corporate world–or from college or wherever we’re from–we have to bust it. There is no longer a paycheck that’s coming no matter what. We have to earn every cent. We’re all doing it for a larger dream, too. I wanted to pull that out, plus I’m really interested in how you operate.

Tristan: I think that’s common for a lot of us. It’s no different from when you or I worked in a larger organization. We probably did the same thing. We were busting our asses at two in the morning. Eventually it becomes, “Why am I doing this for somebody else?”

Instead of dealing with the nitty-gritty of some mechanical policy that’s not allowing me to innovate, why don’t I do that for myself, and really try and solve other people’s problems in a more direct fashion?

We Have This Drive To Create

Melinda: I love that you use the word innovate, because I think a lot of entrepreneurship, of course, we have our own “why” as to why we’re doing it, but one big commonality that we all have is we’re innovating. That is what we want to be doing all the time. We have this drive to create, and that’s what we have in common there.

Tristan: There are a lot of people out there who I would consider entrepreneurs, who consider themselves entrepreneurs, who are innovating on a small scale.

I know a lot of people in Silicon Valley who look down on people who are just creating yet another brick and mortar business, or yet another restaurant, or even an e-commerce site or a blog. Personally, I think these are all levels of innovation.

People have a lot of different reasons why they go into entrepreneurship: I think they are all valid. Being an entrepreneur is not a question of scale but the drive and self-imposed desire to solve problems. That’s what I think really qualifies it.

Melinda: What is the bottom line for you personally? What really drives you to do all of this?

Tristan: I’m rather introverted; given no agenda for the day I would most likely curl up into a little ball with a television. I get a lot of satisfaction seeing the end result of my labor and seeing people actually make progress against their goals. It’s like listening to a good song.

When I played in a band and worked with other bands as a producer, those jobs offered immediate satisfaction. When there is too much distance from the impact of what you are building, which can happen in a large company, even if you’re working for a phenomenal company.

If you don’t actually get to interact with those customers, and see the satisfaction on their faces when they buy or use your product, I think that can become very demotivating. For me, the satisfaction of genuinely helping somebody is the end-all be-all. If you don’t have that, I don’t know what you’re doing.

Whether you want to call it business model innovation, or Lean Startup, or Lean Canvas, or Business Model Canvas, or any of those individual methodologies doesn’t really make a difference. The question is: are you actually helping people enable their own creativity and problem solving?

What is Waste?

Melinda: Can we talk about Lean Startup principles? Many in our audience have read the book; I found it to be excellent. Many, many things hit home for me. One was that failure is a good thing: we need to fail fast and pick ourselves up, eliminating waste and not repeating the same failures so you can efficiently move along.

I want to get your perspective on failure: how do you accept yourself and love yourself through the failure, but eliminate waste and not fail any more than you have to.

Tristan: Eliminating waste is the original lean: what Taiichi Ohno and the crew at Toyota first created as “just in time manufacturing” and later  became known as lean manufacturing.

The idea was to eliminate waste in terms of resources being used to create one physical product. I think it gets confusing, because a lot of people have a different sense of waste. The definition of what waste is and what the product is that you are trying to build changes the way you approach things.

If you are trying to build the product, even an insubstantial product, there are a lot of things that could be waste. There’s code and automated testing that might be considered waste even though it helps you maintain quality. Ultimately, the thing that Lean Startup identified is if you don’t know what product to build in the first place, then, it is all waste.

Failure of a Hypothesis is Not Failure of Your Startup

If you don’t know what the product is that the market wants, then everything you build is waste. The only thing that you can focus on is producing a business model that capture the knowledge and know-how in your company of what the customer wants and how to deliver that. Waste is really anything that you do that is not directly focused on learning about your business.

You might run a test and you put up a landing page and you put up a value proposition and nobody bought it. Some people might say that is failure, but it is not. You have to look at it in terms of, “Did we produce any units of knowledge? Did we learn anything?” A failed test teaches you something if you invalidated a hypothesis. For example, you have successfully discovered that nobody wanted that value proposition; therefore you don’t have to build that product. Failure of a hypothesis is not failure of your startup.

Melinda: A lot of us have things that we want to build, some are tech related and some are not. When you should actually start building that product? Should you always be explicit about your concept sand prove the desire for it in the market first? What is your strategy on that?

Tristan: Focus on what is the riskiest thing about your business model. Sometimes it may be a technical risk–can we make this piece work–and sometimes it may be an aspect of market risk–will people pay for this?

A Lean Startup Starts With You Admitting Your Ignorance

Melinda:  So when we want to create a product, evaluating just how obvious the problem is in the market is the first step. How much do we really need to test? What are the fundamental steps Lean Startup recommends?

Tristan: A Lean Startup for me is first and foremost the willingness to admit your ignorance. It’s recognizing that we don’t  know all of the answers. That’s step number one.

If you think that you know everything, that you have a perfect product, that you have a crystal ball that lets you make a spreadsheet for  how much revenue you’ll have five years into the future, Lean Startup is irrelevant for you.

But for those of us who are willing to start with that premise that “I don’t know,” then our first step is identifying the blanks and asking, “How do I go about learning more?”

Other Perspectives Are Critical to Uncovering Your Ignorance

The second step for me is getting perspective. We can identify some of the gaps in our knowledge but we may still have blind spots, where we don’t know that we don’t know. What Rumsfeld called the “unknown unknowns.”  It’s at this point that you should really take the advantage of other  perspectives on your problem:

  • From colleagues: Ask them for their opinion on your business model. Ask them to question you, to challenge you,  to force you to validate key assumptions for them.
  • From potential customers: Do they really have the problem that you think they have?

Getting other perspectives is a critical part of Lean Startup. It’s not talked about as much in the canon, but nobody can identify all of their own assumptions: it’s like trying to stare at your own eyeball without a mirror.

You need a second pari of eyes. Then, and only then, can you really do what Eric Ries talks about in his book, which is that “Build, measure, learn” loop. Until you’ve identified those assumptions, you can’t go about building something, measuring it and learning from that, because you don’t know what you’re trying to learn.

You Can Adjust Your Product Or Your Market Focus

Melinda: What I’m hearing is that it’s important to approach your business in a humble way and say, “Even if I know exactly what I want to create, I need to listen to colleagues and potential customers–and later on actual customers–so that I understand my customer base and adjust my product as I’m building it.”

Tristan: Absolutely. Or adjust your market focus. What you’re striving for is product-market fit. Not only can you adjust your product all you want, you can also adjust your market focus.

I personally prefer to stick with the market because I am normally motivated by empathy for a certain group or niche and I want to solve their problem. So I will continue to adjust the product. But I know other entrepreneurs who start with an invention, who have discovered a technology and are searching somebody who wants it and will pay for it.. It’s not my preferred approach, but entrepreneurs often do it.

It’s All a Matter of Opinion Until You Run the Experiment

Melinda: That’s interesting that some of us are motivated more by the market we’re talking to and others are more motivated to find a use for something they have invented. In my experience working at companies of different sizes and in my own startups I often see teams make decisions on opinions or what we like personally. This applies to feature selection, marketing decisions, all the way on down. Sometimes it can be hard to move forward when there are several conflicting opinions. How do you move past that?  When is it OK to use opinion and when do you absolutely say, “Look, the market has to tell this, not our opinions?”

Tristan: There’s no great rule of thumb, to be honest. It’s all a matter of opinion until you run the experiment. Whether it should be red button or green button, there’s no intellectual argument you can have that says what design will be more aesthetically pleasing and result in better click-throughs.

You might have some previous case studies or some analogs that you’re familiar with, but ultimately the market is the only one who can tell you for certain which one is best. But it only makes sense to test those things that you have a strong feeling will actually have an impact.

If you’re working on a brand-new product, testing the color of the button is probably not the first thing you should do. You should probably test that tag line you were talking about before. Can you explain the value proposition to somebody? Even before you determine whether or not anybody wants the value proposition, are you explaining it correctly? Can anybody understand what you’re talking about?

If your product is guaranteed to cure plantar fasciitis–which is a serious problem–and your tag line is “Cures plantar fasciitis instantly,”  that would be an extremely valuable proposition. But do many of your prospects know what plantar fasciitis is? Perhaps the better phrasing: “Do you have foot pain?” “Do you have a pain in your heel when you get up in the morning?”

The value proposition is far more important than what color is the button. It does take a certain amount of judgment to figure out what is the most important thing to test, right now. Is it going to be the line spacing or the font you’ve chosen or is it going to be the actual functionality of your product? It really depends on your target market and how severe the pain is. If it’s a very severe pain, the design is probably not an issue.

But if it’s only a weak pain point, something makes your prospect’s life just a tiny bit easier, than design is a huge factor:  the user experience has to be very fluid and friction-less.

Don’t Get “Stuck in Solution Land”

Melinda: When a client approaches you with a problem what techniques do you use? The Lean Startup book highlights “5 Whys” is that one that you use a lot? How do you kind of drill down to find a solution?

Tristan: Ignorance is my best technique. I never know about the person’s product. In fact, 90 percent of the time, I don’t want to know about the person’s product. It won’t help me and is likely to get me  “stuck in solution land” as my colleague Kate Rutter would say.

If I don’t know anything I  can adopt an outside perspective

  • I don’t know anything about the customers.
  • I don’t know anything about the value proposition.
  • I have the benefit of perspective and ignorance in that I don’t have any of the assumptions that the entrepreneur has.

The “5 Whys” vs. “5 Whos”

I can ask really stupid questions like, “OK, I understand your value proposition is to solve my plantar fasciitis, how many people are affected?”

You mentioned the “5 Whys” and I will use that for root cause analysis.  But normally I start with the basic: “who is your customer?” That’s the question that I usually wind up asking five times:

  • Who is your customer? Oh, it’s everyone.
  • Really, is it for my grandmother? Would my grandmother buy this product? Sure, she’d buy this product. She doesn’t have a computer. OK, maybe she won’t buy this product.
  • Would my six-year-old buy this product? No, probably not. Also not a big computer-user. Now we’re starting to narrow down the customer segment.

I ask “Who is your customer?” and “What is your value proposition?” repeatedly. It can help the team identify key assumptions that they didn’t realize that they were making and a better map of what they don’t know.  Both of these then need to be explored and tested.

Testing, Testing,…

Melinda:  What are some simple ways you can run a test? I think a lot of people just don’t do tests, because they think it has to be super scientific.

Tristan: I think that’s a common opinion but it’s actually a misunderstanding of what a truly scientific test is. To be scientific you need a theory–or a hypothesis–that can be disproved. You can substantiate it, but you never prove it, only disprove it with new data or observations.  So to keep it simple you look for ways to disprove your key hypotheses which are the your riskiest assumptions in your business model.

Melinda: Really, work on disproving rather than proving?

Tristan: Yeah. All tests should be designed so that you can actually fail them. Most people design tests and they’re looking for that 95 percent confidence rate: they haven’t set any fail condition. So that means that there is no condition under which they would stop doing what they’re doing.

For example, “I can get people to click on my adwords” vs.  “for my business to work I need to get at least a 20% click through rate.” The latter is a better test because it’s easier to disprove. With the former as long as someone clicks at least once at some point then you feel encouraged to continue.

My Product is For Everyone (That I Know)

The most common theory of a first time entrepreneur is that everybody wants the product.

Melinda: Does it worry you when you hear someone say, “My product is for everyone.”

Tristan: Yes, but if you actually ask, “Tell me more about your customer” they actually refine it quite rapidly. Most people don’t actually even believe that it’s for everyone because they haven’t even thought about that, yet. Sometimes when they say everyone they mean “everyone in Silicon Valley” because that’s what has shaped their worldview. But it can happen anytime the members of a  startup team are very similar and only hang out with people like themselves. Getting a little diversity in your worldview is a quick cure for that.

How to Advise Entrepreneurs About Their Business Idea

Melinda: Do you have some simple tips for how our audience can become better at advising colleagues?

Tristan:  Yes, here are four  key things anyone can do to help:

  1. Don’t focus on someone’s idea for a solution.  You may find it absurd or very reasonable but either way you will have a bias.
  2. Ask: “What is the customer segment?” Is it well refined? Is it focused?
  3. Ask: “What is the value proposition? Is the proposition is comprehensible? Will the customer segment understand it?
  4. Ask: “How are you testing it?”  Can the test fail? If not, get them to reframe it to one that can.

Summary; Three Key Steps to Get Started

Melinda:  What do you want our audience to take away?

Tristan:  Whatever business idea you’re focused on right now, no matter how much you think you know something, say out loud, “I don’t know. I don’t know and I’m going to test this.” Then get somebody else’s perspective. Ask a fellow entrepreneur, “Please spend the next 20 minutes and challenge me on everything I’m saying. Don’t argue against me but just ask me questions.”

If you can have a conversation with somebody for 20 minutes, where they only ask you questions and you don’t defend your value proposition just explain it, you’re going to find that you have a lot of unanswered questions. That’s what you need to test. Just start with, “I don’t know.” Get a second set of eyes on whatever you’re doing. That’ll take you 90 percent of the way.

After that join a Lean Startup Circle group near you. There are groups all over the world. It’s just a group of fellow entrepreneurs who, just like you, are  there to learn and to challenge each other constructively.

Melinda: I want to thank you so much for spending this time and lending your expertise to us. Thank you so much, Tristan. I sure appreciate it.

Tristan: No, no. Thank you very much and I hope you all have a great day. Good luck to you and your businesses.

Melinda: Thank you. To learn more about the Outlier movement, visit OutlierMagazine.co.

Related Blog Posts and Articles

A Note on the Transcript

These excerpts represent about 50% of the raw transcript. They are in the same sequence the took place in the interview but a number of stories and asides have been omitted to focus on what I felt were some extremely valuable insights from Tristan Kromer. I have added subtitles and hyperlinks for easier scanning and context. I used CastingWords.com and supplied a copy of the raw transcript (which ran about 7300 words) to Melinda Yeaman of Outlier for their use.

Lee Harris’ Insights on What 9-11 Means

Written by Sean Murphy. Posted in skmurphy

Some excerpts from “Civilization and Its Enemies” by Lee Harris, with commentary on the implications of 9-11 for Silicon Valley.

We Have An Enemy

It is the enemy who defines us as his enemy, and in making this definition he changes us, and changes us whether we like it or not. We cannot be the same after we have been defined as an enemy as we were before.

That is why those who uphold the values of the Enlightenment so often refuse to recognize that those who are trying to kill us are their enemy. They hope that by pretending that the enemy is simply misguided, or misunderstood, or politically immature, he will cease to be an enemy. This is an illusion. To see the enemy as someone who is merely an awkward negotiator or sadly lacking in savoir faire and diplomatic aplomb is perverse. It shows contempt for the depth and sincerity of his convictions, a terrible mistake to make when you are dealing with someone who wants you dead.

We are the enemy of those who murdered us on 9/11. And if you are an enemy, then you have an enemy. When you recognize it, this fact must change everything about the way you see the world.

We face enemies who want to kill us and we need to act accordingly.

Pockets of Peaceableness

The first duty of all civilization is to create pockets of peaceableness in which violence is not used as a means of achieving one’s objective, the second duty is to defend these pockets against those who would try to disrupt their peace either from within or without. Yet the values that bring peace are the opposite values from those that promote military prowess, and this poses a riddle that very few societies have been able to solve and then only fitfully. If you have managed to create your own pocket of peace – and its inseparable companion, prosperity – how will you keep those who envy you your prosperity from destroying your peace?

There is only one way; you must fight back; if your enemy insists on a war to the finish, then you have no choice but to fight such a war. It is your enemy, and not you, who decides what is a matter of life and death.

Once you have accepted this reality, however, you are faced with the problem of how to fight. If the enemy is composed of men who will stop at nothing, who are willing to die and to kill, then you must find men to fight on your side who will do the same. Only those who have mastered ruthlessness can defend their society from the ruthlessness of others.

By creating these pockets of peaceableness–places like Silicon Valley–the United States gains a tremendous economic advantage that confers prosperity not only on its own citizens but all of its trading partners. It also gains significant military strength if we are willing to invest in raising, equipping and training military forces to use these technologies. But technology is not enough.

A Code of Honor

This was the plight faced by the peasants in Kurosawa’s masterpiece, The Seven Samurai and by the dirt farmers in the American remake, The Magnificent Seven. Men and women who knew nothing of battle, the impoverished peasants of a remote village found themselves at the mercy of a gang of ruthless bandits who each year came at harvest to steal what the peasants had managed to eke from the soil. In their desperation, the farmers turned to the seven samurai, all of whom had fallen on hard times. But then, once the samurai had defeated the bandits, the question immediately arose in the peasants’ minds: “Now how do we rid ourselves of he samurai?”

Such has been the lot of most of mankind: a choice between the gangsters who come across the river to steal and the gangsters on this side of the river who do not need to steal because they have their own peasants to exploit. How else could it be? Given what we know of human nature, how could we expect there to be a government that wasn’t, in the final analysis, simply a protection racket that could make laws?

Yet this is not how Kurosawa’s movie ends. The samurai do not set themselves up as village warlords but instead move on, taking only the wages due them for their services. How was this possible? It was possible only because the samurai lived by a code of honor.

Codes of honor do not come cheap, and they cannot be created out thin air upon demand. The fact that you need samurai and not gangsters is no guarantee that you will get them; indeed, you will almost certainly not get them when you need them unless you had them with you all along.

A code of honor, to be effective when it is needed, requires a tradition that is blindly accepted by the men and women who are expected to live by this code. To work when it must, a code of honor must be the unspoken and unquestioned law governing a community; a law written not in law books but in the heart – something like an instinct.

A code of honor cannot be chosen by us; it can only be chosen for us. For if we look on it as one option among many, then we may opt out of it at will. I which case, the community will never be quite sure of us when the chips are down.

Inculcating a code of honor requires a willingness to see the world as it is, not as we want it to be.

See The World As It Is, Not Just As We Want It To Be

All of which explains why those who subscribe to the values of the Enlightenment find the existence of the enemy so distressing.

The enemy challenges the Enlightenment’s insistence on the supremacy of pure reason by forcing us to respect those code of honor whose foundation is far more visceral than rational, a fact that explains the modern intellectual’s hatred for such codes in whatever guise they lurk. The enemy requires the continued existence of large groups of men and women who refuse to question authority and who are happy to take on blind faith the traditions that have been passed down to them. The enemy necessitates the careful cultivation of such high-testosterone values as brute physical courage and unthinking loyalty to a leader.  The enemy propels into positions of command men who are accustomed to taking risks and who are willing to gamble with the lives of others, and shuns aside those who prefer the leisure of contemplation to the urgency of action. Lastly, the enemy shatters the Enlightenment’s visions of utopia, of Kant’s epoch of perpetual peace and of the end of history.

Our modern civilization in Silicon Valley will require continued sacrifice to prevail.

See also these 9-11 related posts

No Such Thing as a Random Sample of Five People

Written by Sean Murphy. Posted in Customer Development, skmurphy

Q: I have 3D printed a couple prototypes of my product. I am going to get user feedback by letting security guards–my target market–test if for free for a few days. How many prospect should I have test it before I can determine if there is a market for the product.

Since you are 3D printing and can iterate I would start by getting feedback from five folks: see Why You Only Need to Test with 5 Users by Don Norman for some research on why this is a reasonable place to start.

You will more than likely end up talking to more folks before deciding if there is a market or not but working with a small group at one time and testing iteratively will be easier to manage and teach you things more rapidly.

There is No Such Thing as a Random Sample of Five People

 

Be aware that there is no such thing as a random sample of five people and that there will be unconscious biases in your selection process that you will need to adjust for (e.g. availability, channels or methods used to solicit, reasons for responding, geography location, etc..) , for that you need to get to larger numbers depending upon what your hypothesis is for the level of interest.

There are unconscious assumptions built into Norman’s suggestion for five, they are not “random people.” They have to be willing to test your product, have the ability to understand the need or problem it’s designed for, have the ability to use the product, etc..

Ten Tips For New Product Demos

Written by Sean Murphy. Posted in Demos, skmurphy

Here are ten tips for managing new product demos to prospects. While it’s always a good idea to preview inside the team and perhaps call in some favors for “friendly fire” review, at some point you have to bite the bullet and start giving new product demos to prospects. Here are my top ten tips (or lessons learned) for a new product demo:

  1. I use GoToMtg to walk through 3-5 screen of a new site or SaaS Apps with one to three customers at a time. GoToMtg can screen share and record the session. There are many other alternatives to GotoMtg  that are also viable.
  2. In a one on one demo or where a handful of  folks are all from the same company consider giving control of the mouse to the prospect. You will learn a lot from how they interact with your product.
  3. There are always obvious problems that get overlooked until the first half-dozen real customers look at it: corollary, the fastest way to find a typo is to print a few hundred copies for a trade show, one of the first five visitors to your booth will spot it immediately.
  4. Things you think are obvious turn out to be undiscoverable by many users.
  5. New visual metaphors and interaction models are never as well accepted–no matter how powerful you think they are–as using existing representations customers are comfortable with. You need to offer them side by side or in parallel. A spreadsheet, bar chart, or trendline lets them understand a directed graph, treemap, or other complex visualization.
  6. People are much more accepting of a small but immediate–one that takes little effort–benefit than a large benefit that takes a lot of work. More than about three mouse clicks without a payoff is effectively forever (or never). Present a small benefit as quickly a possible (or a larger benefit with only a few clicks) and put it up front, don’t build for 15 minutes to a large payoff.
  7. Have a PowerPoint slide version available of key screens, use the markup tools embedded in PowerPoint slideshow mode to let the customer markup the screen for what they would like to see (make sure you save the markup in a copy of the deck). Often you can do a walk through just in PowerPoint (with image stretched to screen edge so that it looks like a real application).
  8. Keep a Text File / Word Doc open and take notes in front of them to stress that you are listening to what they are saying. If you just rely on the recording to capture their words it can seem like less of a conversation. You can also use a GoogleDoc or PrimaryPad for shared note taking if it’s more of a problem discovery conversation than a pure review of a new app.
  9. Have them show you what they are doing now to solve the problem with an existing app if it’s more of a problem discovery or initial conversation. Or they really don’t like what you are showing. Paradoxically if they hate it you often get better specific feedback than from a lukewarm “that’s nice” or ‘this looks interesting” reaction.
  10. Have a second person on the call/screenshare you can trade off with to probe for specific issues and to give you time to think to ask good follow ups. The “listener” can also be taking notes in real time. You can miss things in the first run through you catch on the tape but the act of taking notes in real time forces you to focus on what’s important in  way that listening to a recording does not seem to.

 Great Demo! Public Workshop October 15-16, 2014

October 15&16, 2014 “Great Demo!” San Jose, CA Register Now

Our next public Great Demo! Workshop is scheduled to take place October 15-16 in San Jose, California.

This is an excellent opportunity for individuals, small groups or for teams that have new hires.

We’ve found that these events are most productive when there are two or more participants from each organization (singletons are also fine). This helps to mimic real-life interactions as much as possible, both when preparing demos and delivering them in the role-play sessions.

Related Blog Posts

Counting Your Blessings

Written by Sean Murphy. Posted in Silicon Valley, skmurphy

The next few weeks and perhaps the next few years are going to be awful. Keep counting your blessings anyway, remain kind, and continue to make a difference.

Peggy Noonan wrote My Brothers and Sisters on March 8, 2002 in the Wall Street Journal. She subtitled it “A report from New York, six months on” indicating it was a reflection on 9/11. I have re-formatted an excerpt as a meditation on the need for counting your blessings.

The odd thing
   about these people
   is that they have everything.

They are rich, accomplished, healthy;
   they have marriages, children, love;
   they don't have to be up nights
   worrying about paying the rent
   or the electric bill.

And they are not really happy.

They have been lucky so long
   they don't even know
   they're lucky anymore.

That's the bad thing that can happen to you 
   when you've been lucky too long:

You start to think it's not luck,
   it's what you deserve.

And instead of being grateful
   you get a bitter-tinged sense of entitlement.

You start to think you deserve it,
   you made the right choices.

You're smarter than the dumb people,
   or more accomplished than the lazy people.

When the truth is
   you're lucky and blessed
   and should be on your knees
   saying thank you for your good fortune.

The next few weeks and perhaps the next few years will continue to be marked by considerable turmoil between the rise of a blood drenched Islamic Caliphate, the Russian invasion of Ukraine, and an Ebola epidemic that is currently estimated to kill 20,000 and may kill ten or a hundred times as many if it kills enough doctors and nurses in one or more African countries to trigger a collapse of urban healthcare systems.

Perishable Opportunities For Kindness

There is much we are aware of and little that we can influence, but don’t let that become an excuse for not making a difference where you can.  We may all only live once but I prefer a 19th century Quaker assessment of the obligation that places on us over any number of hedonistic or self-centered “you only live once” philosophies:

“I expect to pass through life but once. If therefore, there be any kindness I can show, or any good thing I can do to any fellow being, let me do it now, and not defer or neglect it, as I shall not pass this way again.”
Stephen Grellet

Related Articles and Blog Posts

Second Sight: A Meditation on Silicon Valley and 9-11

Written by Sean Murphy. Posted in Silicon Valley, skmurphy

Michael S. Malone wrote “Second Sight” for the Dec-3-2001 issue of Forbes ASAP (a great quarterly magazine put out by Forbes and edited by Malone that no longer seems to be available on-line).  It’s also collected in his book “The Valley of Heart’s Delight: A Silicon Valley Notebook 1963-2001” as Chapter 3. It’s a meditation on Silicon Valley and 9-11. Writing in the aftermath 9-11 he reflects on the roots of Silicon Valley in the Cold War and World War 2.  What follows are excerpts with subtitles and hyperlinks added, intermixed with commentary

Second Sight: Seen Through A Relic, A Haunting New Vision

I bought it on eBay as a lark, in the days when we all felt rich enough to do such flippant things. I don’t even remember my winning bid, which says something as well.

It came in a 3-foot-square cardboard box, which I opened on the driveway to minimize the mess, as workmen behind me sanded and hammered away while restoring my house. It was wrapped in a black foam sheet encased in wadded pages of the Connecticut Post. One headline read: “Gates Tells Congress to Trust High Tech.”

I knew what I’d find when I pulled away the sheet: a Norden bombsight. But I was still taken aback by its presence. It was black as anthracite, with dust in every corner and curve. The dust of an English runway, perhaps? Or sand from North Africa? Or just the cobwebs of the garage in which it had sat for the past half century.

Malcom Gladwell did a TED Talk on the “Strange Tale of the Norden Bombsight.” He asserts that the development of the Norden cost 1.5 billion dollars in 1940 dollars, about half the cost of the Manhattan Project.

Less Menacing Than Coldly Malign: A Relic Weapon

It seemed less menacing than coldly malign, in the way only a relic weapon could. Twenty pounds, not much bigger than a football, with a cylinder at one end, a sphere at the other. It was seeded with knurled knobs and toothed gears and dials. From one side hung an old cloth-insulated wire terminating in a plug. Underneath, it held a small pane of glass the size of a cigarette pack. On top, a second pane opened like a porthole into the sphere. And at the center, covered with a rotting rubber eye protector, was a lens.

I set the contraption atop the recycling bin and stepped back to regard it. On that bright Northern California day, my prize seemed like a dark emissary from a forgotten time. From one angle it looked like a clock mechanism, from another an automobile transmission, from yet another a bomb.

It was, in fact, all three. Mounted in the nose of a B-17 bomber, attached with gyroscopes and rotating mirrors and cables to the airplane around it, and manipulated by a deft bombardier, the Norden was the most dangerous weapon in the world in the early years of World War II. Once it was set on a target and adjusted for airspeed and other variables, the Norden literally took over for the pilot, flying the plane on a strict approach path and telling the bombardier when to push the button to release the ton of bombs or incendiaries from their racks 10 feet behind him.

So technologically innovative and important was the Norden–neither the Germans nor the Japanese had anything close–that bombardiers were sworn to do whatever was necessary to keep one from falling into enemy hands. If the bomber was going down, they were to pull out their .45-caliber automatic and shoot it or pull a switch that ignited an explosive mounted inside the device. Or, if all else failed, they were to obey orders to ride the plane right down into oblivion in the German soil.

“Neither the Germans nor the Japanese had anything close” is not quite correct. A German spy ring stole the plans for the Norden before the war: they were used to implement the Lotfernrohr 7 that saw wide use by the Germans.

My Father Used a Norden Bombsight in the Nose of a B-17

My father sat at just such a Norden bombsight on a rickety seat in the Plexiglas nose of the “Badland Bat,” a B-17 in the 615th Squadron of the 401st Bomb Group of the 8th Air Force. As the barrels of the twin .50-caliber machine guns overheated from his futile attempts to shoot attacking German fighters, as flak burst just beyond the glass and dying men in planes around him screamed into his headset, and as his heart pounded and his hands shook from the fear and the adrenaline, he would bow his head as though in prayer and bring his eye against the frozen eyepiece. Twisting one knob, then another, he would align the reticulated crosshairs on the target. Then, so freighted with helplessness and horror that the passing seconds seemed like days, he would hit the switch that surrendered control of his life and those of the seven men around him to that little black machine.

The target itself had been identified that morning at a pre-dawn briefing in a Quonset hut thick with the smell of cigarettes and coffee. The target always had a name–Schweinfurt, Cologne, Berlin–and a title: ball bearing factory, pillboxes, industrial district. But on the map and in the crosshairs, it was merely an image of a bridge or a crossroads, or the shape of a building. There were no people in sight; just the abstract shapes of targets and then the sudden blooming of explosions as the Badland Bat left a swath of fire across miles of German farms, villages, and towns.

Thirty times over Germany and France between January and June 1944, my father bowed to his bombsight. Looking back, he would tell me that for all the terrors of being fired on by antiaircraft guns and being strafed by German fighters as his bomber flew into and out of target zones, the worst moments were always those seconds when he handed his life over to the Norden–the long moments as he waited for it to tell him to rain death over the countryside.

My father was a young man of intelligence and imagination, and those combat experiences made him brazen. He sneaked off the base the night before D day to meet a girl in a local pub. They also made him cold-hearted. When a rookie crew arrived to replace his hut mates who had died in an earlier raid, my father teased them, saying they’d taken the doomed side of the shelter; they died the next day on their very first mission. But, after four months and 25 missions, the experience began to break his mind. In letters home, the cocky young man who’d circumvented the censors by disguising his number of raids as his birthday (“I am 21 years old today”) found himself toward the end struggling to compose a single coherent sentence (“I can’t seem to keep my mind on one thought anymore.”).

Unlike every second man in the 8th Air Force, my father made it home alive and unhurt. Five years later, he was back overseas, this time on a Pacific island and with a new job in Air Force intelligence. Through another lens–this one shielding his eye with a smoky black filter–he watched purple lightning crackle across the mushroom clouds rising from Eniwetok atoll.

Eighth Air Force  suffered more than 47,000 casualties and more than 26,000 dead in WW2. It’s hard to appreciate the willingness required to “press that attack” and take the losses that WW2 American flyers suffered. Even in the age of drone warfare we may face those days again if our enemies prove as dedicated to their cause as the WW2 Germans and Japanese.

Cold War Baby

My father returned to Germany, and I was a Cold War baby, born in Munich, then a city of vacant lots scraped smooth of the rubble of a once thriving metropolis. It had become a Norden world, with all of us hurtling forward on autopilot over a menacing landscape. Only a few people, like my father as he took the .32-caliber automatic out of the closet and headed for the Czech border, still felt they had some control of their fate.

But soon he lost even that. At the end of the decade we came home. My father found himself closing his military career in Washington, D.C., shuttling back and forth as liaison officer between the war rooms of the Pentagon and the White House, and between the CIA and the FBI. It was a position of enormous responsibility but little control. My father began to sit alone at lunch in the garden of the Hirshhorn Museum to calm himself; on Friday nights he would drink to fend off his sense of the inevitable.

A Nadir in October 1962

He reached his nadir in October 1962. On duty nights, my mother would awaken me at midnight, and we would drive from Falls Church, Virginia, into D.C., me in pajamas and wrapped in a blanket in the back seat. It was usually so lonely and dark that I would sleep the whole way. But this night was unlike any other. Every light in every building on Pennsylvania Avenue and along the Capitol Mall seemed to be on. Yet the streets were eerily empty.

We picked up my father. He usually drove us home, but on this night he was incapable of holding the steering wheel. His voice had a tone I’d never heard before–a tone it probably hadn’t taken in almost 20 years. The Cuban Missile Crisis had begun. Until we arrived, my father had sat alone, in the basement of the Office of Special Investigations before a bank of Teletype code machines, reading with growing horror as they spit out the beginning of the end of the world. The ICBMs armed, Strategic Air Command at fail-safe, airborne divisions kneeling beside runways. He had known as much as anybody on earth about what was unfolding, but he could do nothing about it. The bombsight had taken over. And for hours he sat helpless at ground zero, waiting to die, knowing his family would die as well.

Silicon Valley Had Been Born of War

Suddenly, it was over. Everything seemed to change. Although it was still a Norden world, the target had receded for the moment. My father had almost been a victim. A heart attack a few weeks later nearly killed him. But he survived, retired from the military with honor, and took a job with NASA, heading west with his family to California.

We arrived in Silicon Valley just in time to join the illusion. The Valley had been born of war. Military contracts had built Hewlett-Packard and Varian; the nuclear age had given birth to the Valley’s largest employer, Lockheed Missile and Space. So, too, had defense orders underwritten the success of the Valley’s first modern company, Fairchild Semiconductor. All had grown rich building successive generations of weaponry; they would grow richer yet.

Harry Truman once observed “the only surprises are the history you don’t know.”  Malone recounts some facts that are hiding in plain sight about the origins of Silicon Valley. Radar, radio, and countermeasures–both mechanical and electronic–underwent a rapid evolution to become what was called “electronic warfare.” Starting with World War II efforts and continuing with the Cold War, military R&D funded a considerable amount of engineering effort in Universities and private firms in Silicon Valley.

Valley Turns Away From War, Toward The Department Store

About the time we arrived, in an event all but forgotten even by historians of technology, the Federal Communications Commission announced that all future televisions would offer not only VHF tuners but UHF tuners as well. It was a little event of immeasurable consequences. Chasing million-unit orders, the chip industry for the first time turned away from the bombsight business and toward the department store.

It has never turned back. I remember the day my father brought home a Hewlett-Packard 35 calculatorand pronounced it a miracle. I remember standing in line, with the boys who would later create the personal computer revolution, in the lobby of a NASA building waiting my turn to play Lunar Lander on a computer terminal. I saw the first Atari video game in the hallway of a comedy club down the street from my house. And I walked with my father through a trade show in San Francisco and saw the Apple I, built by two of my neighbors.

America no longer seemed a Norden nation. Our fate was no longer on autopilot. Sometimes we even imagined we were flying the plane. My father cheated death for a quarter century. Each time his heart would fail, some new technology appeared on the scene to save him. He traveled the world, programmed his computer, drank beer, and gave his time to charitable work, acting as though death couldn’t catch him. And when he did die–from a fall off a ladder, not from his scarred old heart–even his death seemed an act of will, not helplessness.

The HP-35 was Hewlett-Packard’s first pocket calculator; it exceeded the numerical accuracy of most mainframe computers available and fit in a shirt pocket.

The Alchemy of Technology and Desire Would Deliver To Us  Of Our Dreams

It was now a willful world, as though an alchemy of technology and desire would deliver to us all of our dreams. Our enemies were less defeated than enlisted into a cybernetic common cause. The autopilot retreated so far into memory that two generations forgot it. We replaced it with nostalgia for the future: the aching desire for that distant, more perfect place we could already imagine, promised to us by our technologies. Our perpetual unhappiness was that we were not there yet, a there that raced ahead from calculators and PCs to bioengineering and nanomachines.

Somewhere, no doubt just ahead, lay the fulfillment of all our desires. The beauty of it was that now, it seemed, anyone could plot his own flight path and pilot his own life.

Modern civilization will require continued sacrifice to prevail. Lee Harris wrote about this in detail in “Civilization and Its Enemies“Forgetfulness occurs when those who have been long accustomed to civilized order can no longer remember a time in which they had to wonder whether their crops would grow to maturity without being stolen or their children sold into slavery by a victorious foe . [...] They forget that in time of danger, in the face of the enemy, they must trust and confide in each other, or perish. [...] They forget, in short, that there has ever been a category of human experience called the enemy.”

That Prelapsarian Time, Just Ended Yet Long Ago

It was in that prelapsarian time, just ended yet long ago, that I carried the Norden bombsight out to the sunny driveway, past the workmen and the new Jaguar, all of them paid for with overvalued stock options. I set it atop the recycling bin, filled with newspaper headlines about the latest stock market record high: “eBay’s Whitman America’s Richest Woman CEO.” I looked through the eyepiece…and saw nothing. Nothing except a mirror reflection of the brilliant day before me.

Disappointed, I put the device back in its box, another bauble from the bubble, and returned it to the garage, between the old, unread art books and the new, unused porcelain–an evil old black toad forgotten in the shadows.

Late on a Mid-September Afternoon

Then late on a mid-September afternoon I took the box out again. Our family had just returned from church, where we had, with other Silicon Valleyites in the pews around us, wept and prayed for the thousands murdered by terrorists. As I bowed my head, I felt the distant mechanical shudder of the autopilot kicking in once more. Driving home, I could see my neighbors putting out American flags and glancing up nervously at any sound overhead. We put out a flag of our own. Then, without thinking, I went into the garage and brought out the Norden.

I did the same as before, though the day was overcast, and the papers in the new recycling bin carried headlines proclaiming “WAR.” The Norden was dustier and darker than ever. The eyepiece seemed harder and more brittle. Once again, I bowed and put my face to it. Looking through the lens I saw this time what I had missed before. What my father had seen before me.

Silicon Valley and 9-11

I saw my family and home caught squarely in the bombsight’s crosshairs.

User Experience Research vs. Customer Discovery

Written by Sean Murphy. Posted in Customer Development, Sales, skmurphy

Q: Why don’t you ever blog about User Experience Research (UX)?

The short answer is that we don’t do it.

Our Clients Want Leads and Deals

My clients come to me for help generating leads and closing deals, so that narrows my focus.

We don’t sell studies to larger firms that want a lot of fingerprints on the gun if things go wrong. If things go wrong for too long for my clients they are out of business. It tends to keep me–and them–focused very directly on revenue. We tend to focus much more on the “job to be done” by the product instead of constructing user personas.

Customer Development Is Customer Discovery and Validation

I look at B2B customer development as a discovery driven sales process, you validate your idea when you get people’s time, their opinions, and ultimately their money. Larger firms and consumer firms pay a lot more attention to the experience, I look more at talking to the right people about a critical business issue and then offering a compelling solution. It’s a different mindset from the UX folks although there is some overlap.

From my perspective UX is an optimization technique for refining an offering in a particular niche. We tend to focus more on:

  • problem identification
  • discontinuous innovation (vs. refinements to an existing paradigm)
  • niche selection
  • and developing a compelling value proposition.

You can tell when you have a compelling value proposition: someone takes out their checkbook or credit card and pays you.

It’s a reasonable but weak signal–necessary but not sufficient–when someone who fits your target user profile is willing to spend time with you. It’s a stronger signal when they give you proprietary information about their needs, and much stronger signal when they ask to evaluate your offering to solve a real problem (not a toy or evaluation benchmark).

How Do You Build A Compelling Value Proposition?

Our approach is to build a model of your customer’s business both before and after they employ your product or service. The delta or difference between the before and after, whether it’s faster cycle time, reduced errors, higher revenue, lower costs, etc.. is a good start on determining your value to them.

Refining your understanding of their business–in particular understanding the diagnostic questions that will allow you to accurately predict the likely impact of your offering on their business–is the key to a good customer discovery interview, correctly pricing your offering, and closing the sale.

Founders Want Leads and Deals

Written by Sean Murphy. Posted in Lead Generation, Sales, skmurphy

Q: I have looked at your website and based on some of your blog posts you seem to provide a full range of tactical services–content, outbound messaging, SEO, videos, newsletters, demos, etc.. Why do you talk about “leads and deals” instead of focusing on the full range of services that you offer?

Founders Want Leads and Deals

We sell to founders and they pay for leads and deals.

Any tactics or strategies we propose we have to connect the dots explicitly to how this will generate new leads or help them create opportunities or close deals. There are many good marketing services firms who sell to the Director or VP of marketing. People in those roles tend to be measured on the number of “marketing qualified leads’” (MQL) that they generate and sometimes look to contract out tactical marketing services to specialty firms.

A Deal Is An Integration Test For Lead Generation & Negotiation Strategies

We are a generalist firm that can look holistically at the new product introduction and implement–often with the help of partners–tactics across a wide range of lead generation techniques with an eye to assist in the negotiation to close of opportunities that are uncovered. We do content development for websites, email campaigns, newsletters, articles, and blog posts. We develop scripts and decks for presentations: live talks, webinars, or videos–and we provide rehearsal and coaching to refine and tune them. But these are all tactics in service of lead generation and preparing for negotiation to close of complex deals.

We look at a closed deal as a successful integration test for the lead generation and negotiation strategies that were employed.

New Products & Markets vs. Known Products & Markets

We also understand the difference between the sales methods needed for new product introduction and those for a product that has many satisfied customers, proven collateral and messaging, and a clear target market. Founders sell to keep the lights on, meet payroll, but primarily because in the beginning no one else can. We work with them directly to rehearse, ride along and support, de-brief, and any other way we can make them more effective. To be able to hire a good sales person the founders will need to demonstrate that they have a working product, a lead generation process that works, and satisfied customers that can be used to substantiate their claims and address the doubts that can block deals from closing.

But a good sales person does not want to have to learn how to sell a product through trial and error, they want to see a recipe that works and proof that it does so in the form of satisfied paying customers. They are able to tolerate a high failure rate (e.g. only closing one in three to one in five opportunities) and are happy to continue to tune and improve it through experience, but they want to know they are following a recipe that has been proven to work at least a few times already.

Our methods assume that the product only has to work in founder’s hands, at least initially, and that we will have to earn the customers trust directly through our actions and the results the product can deliver either in their environment or on their data. Once we have a based of satisfied paying customers, the founders can look at scaling using specialists and that’s where we help to bring on direct staff and find other more specialized firms.

Office Hours: Schedule Time to Walk Around Your Sales Issues

Office Hours ButtonIf you are looking for advice on lead generation or closing deals consider scheduling “office hours” to walk around your current sales process or a particular opportunity you are trying to close. SKMurphy functions as a startup advisor to help you understand the process of building a business. We understand the challenges of selecting an advisor–and advising entrepreneurs–and have blogged about it a few times:

Nine Tips For Expert Public Speaking

Written by Sean Murphy. Posted in Lead Generation, Rules of Thumb, skmurphy

Conor Neill has a great post up today on “a 9 Step Cheatsheet for Becoming a Public Speaking Expert” courtesy of the London Speakers Bureau. I am not usually a fan of  infographics but this is is exceptionally well done. Expert public speaking requires deliberate practice the same as any other skill. Here are some key tips I took away for entrepreneurs from the list but the entire infographic is worth a look.

Nine Tips For Expert Public Speaking

I have summarized what I thought were some of the key points and elaborated on a few based on my own experience.

  1. Be REAL
    Relevant to your audience
    Eloquent  with clear language
    Articulate with clear thinking
    Learned offering an expert perspective
  2. Structure you talk by starting with an overview and ending with a summary. If it’s a long talk summarize at the end of each section and again at the end.
  3. Rehearse enough to be fluid, but don’t memorize so that it sounds canned.
  4. Do at least two dry runs before one other person or a small audience, this can also be over the phone.
  5. Drink water well before the talk (30 to 90 minutes).
  6. Take a bio break a few minutes before the talk and do one last wardrobe check.
  7. Don’t cross your  arms or adopt the headwaiter post (one arm folded across your waist or chest.
  8. Pause at the beginning and periodically for effect.
  9. Only speak when you are looking at someone: eye contact keeps you naturally conversational. It’s OK to look at notes or the screen to help jog your memory, but only speak when you are looking at a person.

Three Ways To Extend Your Speech Beyond the Room

  1. Develop an article as a leave behind, often more effective than slides
  2. Record the talk and blog it including the audio.
  3. Have the talk transcribed and publish an edited transcript to complement the article and the audio.

You Have Four Ways To Generate Leads

  • What you say.
  • What you write.
  • What other people say or write about you.
  • Getting found when prospects are looking.

Public speaking can have a significant impact on your lead generation. A well prepared speech with an associated deck and article as leave behind is an asset, find ways to give it to at least three different audiences.

 

A Great Demo Is A Conversation Driven By Mutual Curiosity

Written by Sean Murphy. Posted in Demos, skmurphy

The best demo–a Great Demo!--is a conversations driven by mutual curiosity.  Your goal is to learn more about a prospect’s current situation and needs while they want to learn more about your product and services and how you can help them.

Mutual Demos

“Before I demo to you, why don’t you demo to me what you are currently using?”

If a customer has an existing software system, this can be a wonderful way to understand the strengths, weaknesses and gaps in their current system–particularly from the customer’s point of view. They’ll tell you what they like, what they hate, what’s missing and a range of other delightful Discovery information.

Additionally, this also inverts the traditional process of the vendor presenting to the customer, to one of the customer presenting to the vendor–an experience often remembered by the customer as remarkable and interestingly different!

Serious Prospects Are Candid About Challenges

One of the ways to tell if an inquiry is serious is that they are willing to put their current challenges on the table. This takes several steps of sequential mutual disclosure/discovery but if a prospect just wants “the standard demo” beyond a basic get acquainted session–which can normally be addressed more directly without a demo–and is unwilling to expose more about their situation, much less give a demo or clear explanation of their view of current gaps or challenges, it’s probably a bad sign. The worst buyer approach is the RFP where they are unwilling to even entertain a conversation before you answer all of their questions in detail.

Related Blog Posts

 Great Demo! Public Workshop October 15-16, 2014

October 15&16, 2014 “Great Demo!” San Jose, CA Register Now

Our next public Great Demo! Workshop is scheduled to take place October 15-16 in San Jose, California.

This is an excellent opportunity for individuals, small groups or for teams that have new hires.

We’ve found that these events are most productive when there are two or more participants from each organization (singletons are also fine). This helps to mimic real-life interactions as much as possible, both when preparing demos and delivering them in the role-play sessions.

Labor Day 2014: Knowledge Work Productivity

Written by Sean Murphy. Posted in checklist, skmurphy

“A holiday gives one chance to look backward and forward, to reset oneself by an inner compass.”
May Sarton

I have not yet internalized the lessons from Daniel Cook‘s “Laws of Productivity: 8 Productivity Experiments You Don’t Need to Repeat” [PDF] so I find myself work–and now blogging–on a holiday. Here are my key take-aways from Cook’s roundup on knowledge work productivity and some additional thoughts on why they are so hard to put into practice. Do as I say not as I do.

Rules For Individual Knowledge Work Productivity

“If you want creative workers, give them enough time to play.”
John Cleese

All of these are taken from research an analysis by Daniel Cook in “Laws of Productivity: 8 Productivity Experiments You Don’t Need to Repeat” [PDF]

  • Work 40 hours a week with time for rest and family.
  • Don’t work 60 hours a work as a burst for more than three weeks, by eight weeks you are well below your original productivity working 40 hours only.
  • Anything burst longer than four weeks of more than forty hours requires recovery.
  • You can do four ten-hour days and take three off and break-even with five eight-hour days.
  • Knowledge work that requires creativity and problem solving tapers off after 35 hours a week.
  • 8 hours of sleep substantially improves creativity and problem solving.

I would never manage anyone the way that I manage myself, so that should tell me something.

Rules For Team Knowledge Work Productivity

Again all of these are taken from research an analysis by Daniel Cook in “Laws of Productivity: 8 Productivity Experiments You Don’t Need to Repeat” [PDF]

  • Teams of more than 4-8 causes communication overhead of 30%
  • Have a plan to grow new teams, split large teams, and manage transition to new projects to manage to these limits or pay the overhead.
  • Seat people together in a closed team room for maximum team productivity.
  • Allow at least 50 square feet per person with side rooms or conversations, calls, and external meetings.
  • Form cross-functional teams where members collectively have all the skills needed to address the problem and are assigned full time.
  • Schedule at 80% capacity and keep a list of valuable side projects for people to work on if primary tasks are completed.

Crisis Models Are Strangely Seductive

I am not sure why the crisis model is so strangely seductive:

  • pulling an all-nighter
  • working all weekend
  • nobody goes home until this is working
  • sleeping in the lab, workshop, under your desk, in your cube, ..
  • my job ate my life
  • projects that are completed on schedule and on budget were “sandbagged”

Sometimes there is a crisis and people can be genuinely productive for 24 or 36 hours straight. Edison’s team would apparently work 20 hours straight, trying one thing after another that failed but believing they were one adjustment or trial away from viability. Global teams have changed this where there are now natural second and third shifts that can rely on common source code repositories–with rollback–so someone on the team can always be up and working on the problem without disrupting natural sleep patterns and family life.

It May Look Like a Crisis, But It’s Only the End of An Illusion

“It May Look Like a Crisis, But It’s Only the End of An Illusion.”
Gerald Weinberg in “Secrets of Consulting” (listed as “Rhonda’s Revelation”).

There are real crises, or at least the abrupt end to what had been comforting illusions. We once worked 12-14 hour days for two weeks straight to help a client pull together a response to an unanticipated RFP from a customer who represented more than two-thirds of their revenue. Their survival was at stake and it was time to see what we could do to preserve the business. They had been caught in a changing of the guard internally at the customer and were blindsided because they had been doing business successfully for more than five years.

We had warned them more than a year earlier that letting any one customer constitute more than 1/3 of the business was inherently unstable but it’s one thing to know you live in earthquake country and another to see your bookcases tip over and say “I am glad I wasn’t sitting in my favorite chair I would have a fractured skull.” We managed to hang on to about 2/3 of the business relationship and they have become more aggressive about new business and cultivating broader relationships at the client, but if we had not worked in crisis mode they probably would not be here or would be a very different and much more intimate company.

Let My Failed Startup’s Epitaph Be:  “I Wish I Had Spent More Time At the Office”

Too many entrepreneurs write the wrong epitaph for their failed startup: “I wish I had spent more time at the office.”  Some examples of crisis thinking from Jamie Zawinski‘s “The Netscape Dorm” diary:

  • Thursday, 28 July 1994, 11pm.
    I slept at work again last night; two and a half hours curled up in a quilt underneath my desk, from 11am to 1:30pm or so. That was when I woke up with a start, realizing that I was late for a meeting we were scheduled to have to argue about colormaps and dithering, and how we should deal with all the nefarious 8-bit color management issues. But it was no big deal, we just had the meeting later. It’s hard for someone to hold it against you when you miss a meeting because you’ve been at work so long that you’ve passed out from exhaustion.
  • Sunday, 5 August 1994, 5am.
    I just got home; the last time I was asleep was, let’s see, 39 hours ago. And I’m not even tired right now. I guess I’m on my second or third or eighteenth wind. I only came home because I was worried that if I stayed there any longer, I’d fall asleep at the wheel again. I didn’t want to stay down there for another night, because I really need a shower at this point; it was a hot day today, and Lou and I played some intense games of air hockey last night that got me all sweaty and disgusting. Wow, I must be tired — I just turned on the television, and MTV is actually moving too fast for me to understand it.

Greg Knauss wrote about a flow state in Man, Do I Miss Those Days a vision of giving himself over completely to the task at hand. I can related and used to be able to work all night but now I can’t make it much past 4am: I find I have been sleeping sitting up, or I hit a number of keys at once with my forehead and wake myself back up, or I’ve been typing the same character several hundred times in my sleep by holding down one key. I get the sense that Greg was lucid and entirely immersed in his task until something, either the cold or hydraulic pressure, took him out of flow.

Once, years ago, I had a morning deadline, a lot of code to write and a two-liter bottle of Mountain Dew. Around 4am, I realized that the window was still open and I was freezing, I hadn’t gone to the bathroom is something like fifteen hours and I was having trouble hitting the keys because my hands were trembling.

Man, do I miss those days.

An Early Start Beats Fast Running

An early start beats fast running.”
Michael Bowen (@mdcbowen) “Cobb’s Rules

Maybe it’s an inability to admit limits or a desire to force the flash of insight or schedule the breakthrough for sometime later tonight or this weekend. If you were not familiar with the research on knowledge work productivity I have now removed that excuse and you will have to find another.

“Human felicity is produced not so much by great pieces of good fortune that seldom happen,
as by little advantages that occur every day.”
Benjamin Franklin

Related Blog Posts

Quotes For Entrepreneurs– August 2014

Written by Sean Murphy. Posted in Quotes, skmurphy

You can follow @skmurphy to get these quotes for entrepreneurs hot off the mojo wire or wait until they are collected in a blog post at the end of each month. Enter your E-mail address if you would like have new blog posts sent to you.

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“An early start beats fast running.”
Michael Bowen (@mdcbowen) “Cobb’s Rules

Used as closing quote for “Start with a List of Customers and Problems that Build on Your Experience and Relationships

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“Technology per se is not disruptive or sustaining: it is the way it is deployed in the market.”
Clayton Christensen in “Still Disruptive

This quote inspired me to update “Distant Early Warning Signs of Market Disruption” with a additional paragraph on the need to counter a disruptive entrant where they are taking root, not where you are comfortable selling already.

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“Almost always great new ideas don’t emerge from within a single person or function, but at the intersection of functions or people that have never met before.”
Clayton Christensen in “Still Disruptive

More context

“Almost always great new ideas don’t emerge from within a single person or function, but at the intersection of functions or people that have never met before. And most universities are organised so you don’t have those intersections. They are siloed. Universities think people come up with great ideas by closing the door. The academic tenure process, where you have to publish to journals which are very narrow, stands in the way of great research.” Clayton Christensen in “Still Disruptive

h/t Sandeep De (@sandeepcast) in Intersections/Exaption: Silo Busting

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“In the heart of every apple is an entire orchard waiting only to be planted.”
Thorstan Osborne

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“Cultivate mindfulness: it’s not the fastest reaction, it’s the decision that leads to the first effective response.”
Sean Murphy in “Cultivating Mindfulness”

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“A man should never neglect his family for business.”
Walt Disney quoted in  Ch. 14 : The Real Walt Disney, p. 361

h/t Entrepreneurs Quotes (@entrepreneurship)

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“Start building network, blog, educating 1 year before you make the leap. Build community. The first sales will always be to friends. Make those friends.” Conor Neill in “Entrepreneur: Start a year before you Start

Used as the opening quote for “Start with a List of Customers and Problems that Build on Your Experience and Relationships

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“When Iran develops its fervently sought nuclear weapon, this will look in retrospect like our last carefree summer.”
Abe Greenwald (@abegreenwald) in “Reality is Neoconservative

Looking back August 2014 may  rhyme with August 1914 (“History doesn’t repeat itself, but sometimes it rhymes.” Mark Twain).

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“We’d achieve more if we chased the dream instead of the competition.”
Simon Sinek (@simonsinek)

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“There now ensued a series of incidents which transported me to the opposite extremes of ecstasy and horror; incidents which I tremble to recall and dare not seek to interpret.”
H. P. Lovecraft

This would make a great opening quote for many startup success stories (and more than a few failure stories).

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“To base thought only on speech is to try nailing whispers to the wall. Writing freezes thought and offers it up for inspection.”
Jack Rosenthal

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“Buddy, we’re here in Iowa. Usually, a man’s word is like gold. A handshake is a contract.”
William Nagel in a Washington Post article on Bruce Braley

I think “here in Iowa” is a good metaphor for how effective bootstrappers manage trust. Full quote:

Another neighbor, William Nagel, who sits on the homeowners association board, said, “Buddy, we’re here in Iowa. We talk like men here and we act like men. Usually, a man’s word is like gold. A handshake is a contract. Neighbors are neighbors, and if you’ve got a problem with your neighbor, you talk it out.”

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“It is possible to create an epidemic of health which is self-organizing and self-propelling.”
Jonas Salk

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“You don’t think that seeing your grandparents die or your parents die is good fortune, but you would be wrong.”
Sean Murphy in “Good Fortune.”

I was reminded of this observation by the recent death of John Foster McKenna, age 23.

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“The way to love anything is to realize that it may be lost.”
G. K. Chesterton

Compare to Achaan Chaa’s “when I understand that the glass is already broken, every moment with it is precious” in Mark Epstein’s Thoughts Without a Thinker (pages 80-81) quoted in “Thanksgiving 2011

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“The tragedy of life is not so much what men suffer, but what they miss.”
Thomas Carlyle

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“He who does not understand your silence will probably not understand your words.”
Elbert Hubbard

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“The best teams are motivated by a sense of mission, of working on the worthwhile. When they have a why they will find the how.”
Sean Murphy in “Five Quotes For Entrepreneurs by Branch Rickey

I was inspired by this quote by Branch Rickey:

“First of all, a man, whether seeking achievement on the athletic field or in business, must want to win. He must feel that the thing he is doing is worthwhile; so worthwhile that he is willing to pay the price of success to attain distinction.” Branch Rickey

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“The stories we tell ourselves can serve as straitjackets for stagnation, or scaffolding for transformation.”
Seb Paquet (@sebpaquet) tweet Dec-1-2010

h/t Conal Elliott

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“Bootstrappers are open to possibility but maintain focus: they explore many options but say yes to only a few.”
Sean Murphy

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“I wonder if one of the penalties of growing older is that you become more and more conscious that nothing is very permanent.”
Eleanor Roosevelt

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“When your toil has been a pleasure, you have not earned money merely, but money, health, delight, and moral profit, all in one.”
Robert Louis Stevenson

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“Blessed is the man who has found his work.
Let him ask no other blessedness.”
Thomas Carlyle

h/t Gretchin Rubin Daily Quotes

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“Treat social capital with the same care as cash: trust doesn’t scale, it’s knit by aligning actions with prior commitments.”
Sean Murphy in “Treat Social Capital With The Same Care As Cash

Similar to this observation

“Trust doesn’t scale, it’s built up by repeated interactions over time. That’s what makes it so important.”
Sean Murphy commenting in “Seth Godin: Trust is Even More Scarce Than Attention

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“They are ill discoverers that think there is no land when they see nothing but sea.”
Francis Bacon (1561-1626) – The Advancement of Learning, bk. 2, ch. 7, sect. 5 (1605).

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“Simple, not easy. There’s a difference.”
Ron Jeffries (@RonJeffries)

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“A fact is a simple statement that everyone believes.
It is innocent, unless found guilty.
A hypothesis is a novel suggestion that no one wants to believe.
It is guilty, until found effective.”
Edward Teller, Conversations on the Dark Secrets of Physics, 1991, p. 69

h/t Kevin Kelly

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“No one wants advice–only corroboration.”
John Steinbeck

This is true for some but not even for most entrepreneurs in my experience.

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“In the mind of the entrepreneur the future is obvious and imminent.”
Sean Murphy in “The Mind of the Entrepreneur

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“What is a trick the first time one meets it
is a device the second time
and a method the third time.”
W. J. Leveque

h/t Mark Zimmerman in “Creative Devices

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“The only courage that matters is the kind that gets you from one moment to the next.”
Mignon Mclaughlin

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“Happiness is neither virtue nor pleasure nor this thing nor that, but simply growth.
We are happy when we are growing.”
William Butler Yeats

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“Fields can lie fallow but we can’t; we have less time.”
Mignon Mclaughlin

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“Ability proceeds from a fusion of skills, knowledge, understanding and imagination, consolidated by experience.”
Jonathan Rez

h/t Quotes on Design

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“Anything that won’t sell, I don’t want to invent. Its sale is proof of utility, and utility is success.”
Thomas Edison

quoted in Daniel Boorstin’s “Cleopatra’s Nose: Essays on the Unexpected”

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“More people would learn from their mistakes if they weren’t so busy denying them.”
Harold J. Smith

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“Acorns were good till bread was found.”
Francis Bacon

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Five Mistakes To Avoid In a Nurturing E-Mail

Written by Sean Murphy. Posted in Lead Generation, Rules of Thumb, skmurphy

I signed up for a free trial of a lean project management tool (I have changed the name of the tool to <LeanTool>). A few days later I got the following nurturing E-Mail.

Subject: Are you afraid to manage your project in a lean way?

We’ve noticed that you haven’t been signing into <LeanTool> for a long time and this is a sign that you are not really committed to being lean. Remember that 96% of innovative projects fail, will your project be one of them? I hope not!

Remember that just having a gym membership is not going to help you get better, if you want to improve you have to do the work!

Log in to <LeanTool> today and start validating your project.

There are a x problems with this:

  1. it’s not nurturing.
  2. It assumes the tool is flawless and the problem is one of my motivation. In fact the tool does not work.
  3. I signed up for a free trial but none of the three primary dashboards in <LeanTool> for hypotheses, experiments, and results actually worked.

So I replied:

I went to add a hypothesis and it said that I need to pay.
I tried to add an experiment and it said I need to pay.
I tried to record a result and it said I need to pay.

Can you please explain your model for free evaluation?

It’s like someone showing you free samples in the supermarket and asking “Would you like to try it?” When you say “Yes” then you hear “that will be a $1″

You advertise a free trial but it seems like it is more like a free product tour, you cannot actually do anything.

Anyway, if what you are doing is working for you don’t stop but it seems weirdly antagonistic and dysfunctional
as an approach to letting me evaluate your software. Do you have any fully worked out examples I can review?

I got the following reply:

Hi Sean, thanks for writing!

We have reviewed the website and realized that there is a mistake: previously, we offered a free trial, and we haven’t updated the text in the startups page.

Sorry for the inconvenience. We really appreciate your feedback and we’d like to offer you a 14-day free trial with all functionality available and a 10% off in our pricing plans.

It seemed a little flaky so I waited a few days and checked their website, it still advertised a free trial.

“Get 1 canvas + 1 user totally FREE (No credit card is required.)”

A day later I got another copy of the original “nurturing” E-Mail.

  1. Sending the identical e-mail a week later is definitely not a good idea.
  2. Not fixing the website announcement of a free trial tells me that they are in free fall.

Map Customer Buying Process Before Sending a Proposal

Written by Sean Murphy. Posted in 3 Early Customer Stage, checklist, Sales, skmurphy

Map the customer buying process, needs, and situation before you invest time sending a detailed proposal. A quick request can mean you are column fodder.

Q: We are still trying to close our first paying customer. We have a website up and have talked to a number of people. More or less out of the blue we got a call from someone in a large firm who had looked at our website. They asked a few questions about our product and then said “Great! Send me a detailed proposal including pricing!”

At last a stranger recognizes the brilliance of your solution in just a few minutes of conversation! How often I tell myself that. How rarely it’s true, especially when you are just starting out with a new product or in a new market. You have to ask yourself:

  • Do they really know enough about what   we do to be able to start a purchase order?
  • Do I know enough about their situation to be able to calculate our likely impact on their business and their return on investment?
  • How can I justify the price to value in the proposal?
  • Have I addressed the critical implementation and proliferation roadblocks we will face from pilot to production use?

You May Be Column Fodder

More often than not you are actually “column fodder” or a makeweight needed so that they can prove to their boss or the purchasing/finance team that they did a thorough job and solicited three bids. Especially if you don’t know much about their situation and they have not asked for a detailed demo you need to proceed a little more slowly.

Map The Customer Buying Process

Before you submit a proposal I would ask your contact these questions to get a better sense of the situation, in particular you need to learn as much as possible about who will make the decision and how they will make it (the customer buying process).

  1. Can you describe the process for making a decision after we submit this powerpoint proposal, who else is in involved, what questions are they likely to have?
  2. Who has to make the final decision to actually sign a contract?
  3. Can you provide an example of a standard contract so we can understand your  typical deal structure and terms and conditions.
  4. Can you give some examples of other deals that your company has done in the last three years that might serve as a model for how our business relationship would work?

Understand Their Needs and Situation

You want to be easy to do business with but that requires that you have a thorough understanding of their needs. I would not send a powerpoint presentation, but ask for time to present it (if only via Webex/GoToMeeting) so that you can answer any questions that they have in the moment. I would also dry run this presentation with your contact if they are open to it. If they just default to “send me a detailed proposal” it’s probably not a real opportunity.

Busyness Won’t Build Your Business

Written by Sean Murphy. Posted in skmurphy, Startups

Busyness won’t build your business, it closes off your creativity and your luck. Anticipate, or at least acknowledge, missed deadlines and commitments: triage or re-negotiate.

Busyness

I recently wrote a friend to ask if he wanted to do something this week, and he answered that he didn’t have a lot of time but if something was going on to let him know and maybe he could ditch work for a few hours. I wanted to clarify that my question had not been a preliminary heads-up to some future invitation; this was the invitation. But his busyness was like some vast churning noise through which he was shouting out at me, and I gave up trying to shout back over it.

Tim Kreider “The Busy Trap

It’s a terrible feeling when you are behind in your work. What might have been good if delivered early and adequate if on time is now insufficient. So you have to keep raising the bar the later you get.  Understanding what is critical to accomplish means making hard choices, and just as when you won’t admit a loss on a stock because you haven’t sold it, you can console yourself that you are still working on that deliverable and it’s just a little late.

Hurried

 “The feeling of being hurried is not usually the result of living a full life and having no time. It is on the contrary born of a vague fear that we are wasting our life. When we do not do the one thing we ought to do, we have no time for anything else–we are the busiest people in the world.”
Eric Hoffer

Hurry creates tunnel vision.  It closes off your ability to notice, create, and act upon chance opportunities. It makes you less lucky. It’s always a good idea to maintain focus and finish the critical tasks that are on your list for today or that you have committed to a customer or a partner.  But if your list is longer than about six hours of work and you are like most entrepreneurs I know, many won’t get done and you should at least prioritize.

Mark to Market

“That thud of the back against the wall is a fantastic motivator.”
Christopher L. Smith

I have a very long to do list that contains goals for the day, week, month, quarter, year, and next year. Sometimes I have to mark tasks [d] for dropped instead of [x] for done. The sooner I do that so that I can finish the critical ones the less I have hanging over me. I don’t mean to make this sound easy or even straightforward but consider the following to catch up and be creative again:

  • Drop tasks that may have been a good idea at one time. Put them on a “good idea” list you can revisit in six months time.
  • Explicitly de-commit or re-negotiate a new deadline if you know you are going to miss one or you have already missed it.
  • If it’s possible: do a partial job early, send a draft, send an outline, timebox for 20 minutes or 30 minutes or an hour and get a small chunk done and ask for feedback. The worst outcome is to be late and have an incorrect idea of what’s expected or needed.

Related Blog Posts

Nadia James’ Daily Checklist for Aligning Efforts With Goals

Written by Sean Murphy. Posted in checklist, skmurphy

Nadia James recently posted a thoughtful article on “Why Entrepreneurs Must Stretch to Reach Their Visions of Success” that included the following daily checklist for aligning efforts with goals for your business.

  1. What vision did I have for my personal and work life when I decided to launch a business? (Think of this vision for yourself as your intended nirvana)
  2. How close am I to reaching my entrepreneurial nirvana state?
  3.  What are some key elements of my entrepreneurial nirvana state? How can I break this vision into bite sized milestones?
  4. How can I better operate my business to achieve my milestones?
  5. What can I do today to invest in my future vision?

She suggests that you spend at least 30 minutes a day working “on the business” instead of just working “in the business.” I like the checklist and had some thoughts on how to operationalize it.

What Can I Do Today to Invest in My Future Vision?

I would start with this question on a daily basis, consider actually planning for tomorrow at the end of the day so that you can start with a key list of todo’s (“What can I do tomorrow to invest in my future vision).  As bootstrappers the primary question is where to invest time and focus and how to delegate to others in a manner that communicates the context you want them to operate in, not just the specific task. Explaining your vision for the business in a way that others can act in it is also worth your time.

 How Can I Better Operate My Business to Achieve My Milestones?

I think this question is worth asking at the end of each project milestone you complete or any result you deliver to a customer.  Daily may be too frequently unless you are working on very small deliverables. There are two things to think about in building raw material for an after action:

  • what did I observe that was surprising (or violated my expectations) and
  • what are key metrics I can track so that I don’t rely purely on memory when I do the actual actual lessons learned.

Another trigger for this question could be a regular weekly or monthly review of key metrics that measure “distance traveled” and “distance to goal.”

What Is My Vision For The Business

If you can boil this down to high level goals then you have can construct some decision rules for whether you are moving toward your “True North.” Periodically you may come to understand that key assumptions you made about the world, the market, or yourself were wrong and you need to make adjustments. But I think these adjustments are either in response to clear failures or something that you do more on a quarterly or twice a year basis.

How Can I Break this Vision into Bite Sized Milestones?

I think this is great advice, in particular if you can see how you can build a small viable business that you can scale into your full vision. While the vision is important I think the ability to break it into a sequence of milestones is critical to being able to achieving it. These milestones would typically involve things that are directly under your control:

  • number of sales conversations,
  • saving money to give you more flexibility,
  • completing product features or clearly defining the services that you want to offer.

You also need to define “stopping rules” where you have to reconsider an approach or even your commitment to the business so that you can be objective in the face of setbacks.

What does entrepreneurial success mean to you? What milestones must you hit to get there?

How Close Am I to Reaching My Entrepreneurial Vision?

By definition I think your goals evolve as you achieve key aspects of your vision.

 “Ah, but a man’s reach should exceed his grasp,
Or what’s a heaven for?”
Robert Browning

 

Entrepreneurs Blend Passion and Prudent Risk Taking

Written by Sean Murphy. Posted in 1 Idea Stage, 2 Open for Business Stage, Design of Experiments, skmurphy

Successful entrepreneurs are fueled by a passion to change the world tempered by prudent risk taking. Many risks have to be managed on an ongoing basis cannot be eliminated once and for by careful planning or the achievement of a particular milestone:

  • managing cash flow and the risk of a downturn,
  • meeting your obligations to your family as well as your business,
  • continually developing new skills and connections to cope with evolving customer needs and new competitive threats.

Noam Wasserman had an article yesterday’s Wall Street Journal on “How an Entrepreneur’s Passion Can Destroy a Startup” that focused on entrepreneurial passion and prudent risk taking. He has some excellent advice with regards to a shared risk analysis with your spouse (and a plan how to decided when to quit before you are in the middle of the roller coaster ride) and identifying potential risks and problems with you plan (what Gary Klein has called a “pre-mortem” in other contexts is incredibly useful for a startup team to do periodically, not as a way of hanging crepe but of anticipating and preventing or mitigating foreseeable problems).

Here is a list of risks he identified

Wasserman Tests: Excess Entrepreneurial Passion

Wasserman Test: Do You … SKMurphy Commentary
Feel like you are on mission to change the world? This is a good thing.
I think this is probably a good thing. Doesn’t mean you should prepare to run your business. But if align your business with a higher purpose I think you are more likely to persevere.
Get insulted when someone points out legitimate flaws in your idea or product? This is a red flag, but it  may be as much about personal maturity as anything else.
Find it hard to come up with pitfalls you might face or to detail a worst case scenario for your venture? This is a red flag, but it may be less about passion and more a lack of knowledge about business or your industry. You need to do premortem’s periodically to prepare for problems and mitigate those you can.
Raise money from professional investors when your #1 goal is to “work for myself” or “to control my own destiny”? I think this is a low probability situation.
This can happen but normally entrepreneurs motivated by a desire for autonomy don’t seek professional investment and those that do are typically screened out as part of due diligence.
Hire friends and family whom you may not be able to fire if they underperform or circumstances change, because you are confident you won’t face those issues? I think this is a low probability situation.
If the business is not doing well typically friends and family want out, if it’s doing well you can often find people role that fits their talents if they worked with you in the beginning.
Neglect to run careful tests to assess consumer demand? This is an ongoing challenge not something you can ever fix or satisfy.
Large business fail at new product launches quite frequently as well, I think this is less a passion problem and more something that is very hard to do.
Assume you won’t need a financial cushion in case the venture takes longer than anticipated to generate income? This is an ongoing challenge not something you can ever fix or satisfy.
Sometimes it’s the fact that a team is almost broke that forces them to make the necessary changes to succeed.
Resist talking honestly with your significant other about the money and the time you expect to commit to your venture, and about the potential pitfalls you face? This is a real risk. This is a hard conversation but one that has to happen frequently. You have to treat you spouse or significant other as a member of the board of directors. I don’t think this is a passion problem per se, but failure to make a joint decision and keep them informed is a real risk.
Figure you don’t need to address the holes in your skills or networks in advance of founding? This is an ongoing challenge not something you can ever fix or satisfy.
There are always holes in your skills, consumer demand changes require new skills, competitors attack you in unanticipated ways that require new expertise, your network is never broad enough. I don’t think you are ever prepared enough and you have to be learning and connecting on an ongoing basis

I was struck by one paragraph:

For instance, almost 800 founders took a predictive test that evaluated their startup ideas, and then received recommendations about the next steps they ought to take. Thomas Astebro and his colleagues found that a sizable percentage of founders who received a recommendation to halt progress on their startups because the idea wasn’t commercially viable kept going anyway—29% of this group kept spending money, and 51% kept spending time, developing their idea. On average, they doubled their losses before giving up on pursuing their idea.

It Does Not Help To Tell An Entrepreneur Their Idea is Not Viable

It’s not helpful to tell entrepreneurs that their idea is not commercially viable. All new ideas are not commercially viable when judged by “conventional wisdom” until conventional wisdom changes.  Entrepreneurs are probably even less inclined to take advice from college professors who have never started a company. If you could reliably predict the economic viability of new idea you would not be selling analytics you would be making  investments.  Here is Thomas Asterbo’s bio from Genesis Analytics

Tom Astebro is currently Associate Professor in Management Sciences at the University of Waterloo. He has seven years of experience in scorecard development. Tom developed the Genesis algorithms and technology as part of research at the University of Waterloo that was sponsored by CIBC and Nortel and earned the distinction as the creator of one of the three “Most Promising Technologies” in a recent Canadian competition.

Tom has published 29 articles, made 49 presentations at conferences, obtained research funding from NSERC, SSHRC, MMO, Carnegie Mellon, Telia, Volvo, Handelsbanken, and the Sweden-America Foundation and won ten international/national research awards. His research has been mentioned in Business Week, the Financial Post, the Globe and Mail and the Ottawa Citizen. He has worked as a management consultant for banks, insurance and manufacturing companies in Canada, Sweden and the Netherlands and has taught at Universities in Canada, the U.S., Sweden and Australia. Tom holds a Ph.D. in Engineering from Carnegie Mellon University and an M.B.A and a M.Sc. from Chalmers University of Technology, Sweden.

Encourage Prudent Risk Taking But Don’t Try and Blunt Passion

What is very helpful is to get entrepreneurs to test their key assumptions–”what else would have to be true for your business to work”–and get them to start testing critical aspects of a plan. When a peer entrepreneur is working on a idea that you don’t think is viable, it doesn’t help to tell them “I don’t think it will work” or even “Here is why I don’t think it would work.”

Instead,  think about framing it as

  • What risks are you worried about?
  • Here are three challenges I think you business has to overcome to be viable. Do you have evidence or results that indicate that this won’t be a problem?
  • What could you do to test or explore how to work around these problems before investing time and money in other activities that don’t attack the riskiest areas first.”

What Would Have To Be True For For Startup to Thrive?

This approach to helping an entrepreneur think  through their risks and challenges is something we try and do at a Bootstrapper Breakfast when someone says what they are working on and another attendees says something like “that’s a crappy idea or that will never work.”

We try and get them to think through “what would have to be true for it to work? What are the key challenges they have to manage to make it work?” Because entrepreneurs can always tell their friends with “real jobs” about what they are working on and either be told, “that’s not viable” or “that’s great” (meaning please stop talking about this) and not get useful feedback or critique.

Related Blog Posts

By Sunday Night Your Chips Are Down For The Week

Written by Sean Murphy. Posted in Consulting Business, skmurphy

“So let us not talk falsely now, the hour is getting late” Bob Dylan “All along the watchtower

Sunday nights are difficult times for me. Friday night you can say, well I have another 48 hours to finish what I promised by the end of the week. But by Sunday night the week is over all of your commitments are marked to market. Your chips are down. Whatever bets you have been able to place will have to bear fruit in the coming days to weeks.

Sunday Night Your Commitments Are Marked to Market

“It’s amazing how long it takes to complete something you’re not working on.”
R.D. Clyde

Most of the commitments I miss are not to family or friends or clients or prospect but to myself.

Jeff Leader and I worked together in Leader-Murphy in the mid-90′s (I wish I had held on to that www.l-m.com domain name) he observed to me at the end of a particularly long work day: “You are a geyser of ideas. But we don’t need any more ideas, we need to finish this book we have started.” We never did. It was 1994 and we had a theory that corporations would use websites for internal collaboration, customer support, and real time governance and control. Sometimes you can see the future you just can’t get it down on paper. We did build more than 30 websites for firms and technical conferences in 1994-1996 but very little of what we built directly survives today.

We started SKMurphy, Inc. 11 years ago by helping two technical consulting companies find new clients: PicoCraft and New Idea Engineering. It was nuclear winter in Silicon Vally after the dotcom crash and it was time to see if the could persist long enough to find the next spring. Both firms are still active today and we continue to assist them. It’s not a bad feeling to see companies that you have helped prosper.

“In my experience, most people don’t schedule their work. They schedule the interruptions that prevent their work from happening.” Mike Monteiro in “The Chokehold of Calendars



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