Category: Talent

Bill Gates was recently quoted about the best perquisite you can provide your employees:

The competition to hire the best will increase in the years ahead. Companies that give extra flexibility to their employees will have the edge in this area.

So what exactly does he mean by flexibility? For one thing, where the employee or team member works. That doesn’t mean if they aren’t at the office they are at home. Staff should be able to work anywhere they can get a [secure] internet connection. That could be office, home, or the local coffee shop. Of course, the other parameter is when. Developers are notorious for wanting to work at night. Do you know why? They have learned that there are far less interruptions. Programming requires intense concentration and interruptions for meetings and other corporate overhead cut down on productivity. Conversely you HR staff should be available in person for the full work week, or at least enough of it so the HR department always is available. So you need to be careful about the when.  The best way to go is to poll you staff about what split between in-office and out-of-office time works best for them. Then come up with some guidelines, not policies! Policies are for bureaucracies, guidelines are for fast and flexible companies.

And there is far more to work time flexibility than the work week. Your venture should have guidelines for major HR contingencies: illness, maternity, death in the family, etc.  But keep these guidelines simple and easy to understand. The fewer, the better.

The best process is to define when people are needed in the office, such as for all-hands meetings or for their departmental meetings. Best to push this decision making down in the organization rather than having come from the top of the organization. Those closest to the issue are best equipped to handle it.

So what’s in it for the firm in providing flex time?  A lot according to the The Deloitte Global Millennial Survey 2019 a lot! I don’t ordinarily quote at length from articles, but in this case I can’t add much to this important list:

Millennials and Gen Z may stay in a job for more than five years if their employers are flexible about where and when they work.

2. Job satisfaction.

According to a recent Staples study, a massive 90 percent of workers indicated that more flexible work arrangements will boost morale and increase their satisfaction at work–a key component of employee recruitment and retention.

3. Companies save money.

It’s a simple equation: Healthier employees lead to more engaged and productive employees. Lost productivity due to poor health costs U.S. businesses nearly $226 billion per year. Companies also pay less in health coverage for healthier employees.

4. Improve employee retention.

Companies with no flexible working policies in place are losing valuable talent. Per the Staples study, 67 percent of employees would consider leaving their jobs if work arrangements become too fixed.

5. Recruit better talent.

Flexible working will also improve your recruitment metrics. A 2018 Zenefits survey found 77 percent of employees list flexible work as a top perk when evaluating job opportunities.

6. Employees are more productive.

One of the primary job of any leader is providing the requisite resources to achieve the specific goals that evince the venture’s mission. Typically those resources are capital and people, though of course in biotech and other fields it might be equipment and laboratories as well. Regardless of the market a founder is targeting recruiting staff, along with raising capital, will rightfully take up a lot of their time and effort.

My group of mentees from the MIT Post-Doctoral Association had asked me to present  “lessons learned” in my entrepreneurial career to  them.  One topic we discussed was what qualities I looked for in job candidates beyond sheer ability to do the work. And here’s what I presented:

• Enthusiasm
• Curiosity
• Intelligence
• Ability to communicate
• Willingness to collaborate
• Accomplishments

Of course, this is just the short list: drive and initiative, sense of humor, and persistence are amongst other qualities I valued highly.  Since it’s virtually impossible for anyone to have every one of these qualities at the 100% or A level,  hiring is all about tradeoffs, as are many decisions in a startup.

So it was an interesting coincidence that I came across the first job ad Jeff Bezos posted for a software engineer 25 years ago:

Turning the ad into a list of required qualities we have:

• Talented
• Motivated
• Intense
• Interesting
• Top-notch communication skills essential
• Experience designing and building large and complex (yet maintainable) systems

And just to make clear Bezos wanted A++ players only. he quantified the necessary experience: “You should be able to do so in about one-third the time that most competent people think possible.” This reminds me of famous bandleader Frank Zappa’s question to a musician who wanted to join his group, “What can you do that’s fantastic?”

So I think you can see what can separate a world class entrepreneur like Jeff Bezos from a journeyman like myself, always going beyond what “most competent people think.”

I spotted the ad in an Inc. article by Scott Mautz entitled, Jeff Bezos Posted His First Amazon Job Ad 25 Years Ago. 1 Telling Sentence Within Foreshadowed the Future and sub-titled The very first Amazon job posting is telling in so many ways. As he writes,

And I love it.

I’ve long been fascinated by charismatic people. Probably because I’m totally the inverse, suffering from SAD – Social Anxiety Disorder. Rather than be the center of attention, I tend to be a wall flower.

I’ve met more than a few charismatic people in business, ranging from the wellknown, like Steve Jobs and Mitch Kapor of Lotus 1-2-3 fame, to the lesser known, like the late Wayne Oler, President of Addison-Wesley Publishing Company. So it was with great interest that I read The New York Times article today entitled What Makes People Charismatic, and How You Can Be, Too, sub-titled Simple tips to break through your social anxieties and make real, genuine connections with others.

Despite author Bryan Clark’s having talked to a couple of experts I find myself disagreeing with his thesis at charisma is a learned behavior and “you can learn it, too!”

The four aspects of charisma I’ve found are a high degree of self-confidence, extreme focus on the individual, enthusiasm, and strong communication skills.

Self-confidence

It’s difficult to say if people who are supremely self-confident are successful because of that self-confidence or self-confident because they  have been highly successful. I would go for the former, as I knew Mitch Kapor well before he formed Lotus Development Corporation and rose to fame in the personal computer industry. He was charismatic long before he became a mega-success. While my sample size is small, I’ve yet to find anyone who I would call charismatic who is not also a success. As a friend who worked at Apple used to say of Steve Jobs and others like him, “Never wrong, seldom in doubt.” And while I’ve never yet met Donald Trump what I’ve read of him is that he can be extremely charismatic in person in small, intimate groups. He certainly doesn’t lack for self-confidence.

Focus and attention

The second characteristic I’ve observed amongst the charismatic is a laser-like focus on the individual, whether listening intently or speaking. People like Steve Jobs and Wayne Oler made me feel like I was the only person in the room, despite the fact that there were several others – and one of higher status – in the room when Jobs visited my department at MIT. Extreme focus means shutting out all external and internal distractions, making it far easier to focus one’s entire attention on the individual they are talking with. (This is the exact opposite of the attitude of many of the rock stars I’ve met who always gave the the impression they were scanning the audience looking for someone more important than I to talk with.) I do believe one could be trained to at least emulate this aspect of charisma, but there is more to it than eye contact – though that’s important – there are doubtless many non-verbal cues entailed. The most simple example is people show engagement and attention by leaning forward. The tend to demonstrate lack of engagement by leaning back. I’d love to see Carmine Gallo, who has studied Steve Jobs’ keynote presentations in depth, to analyze his non-verbal cues given in the many videos of Steve. One does have to be careful not to let extreme self-confidence morph into arrogance, a situation not unknown by people who worked with Steve Jobs. While charismatic people may have an agenda with you, they hide it completely as part of their ability to focus their attention extraordinarily well.

Enthusiasm

I’ve yet to meet a charismatic person who lacks enthusiasm. In fact people like Steve Jobs take enthusiasm to the next level, appearing messianic about their products or causes. If you have read this far it may occur to you that charismatic people make good sales people. Certainly Steve Jobs was known as a great sales person. And I’ve yet to meet a successful sales person who didn’t evince a high level of enthusiasm for their products. The dictionary definition includes three important elements of enthusiasm: intense and eager enjoyment, interest or approval. Charismatic people tend to be overwhelming positive. That positivity is exhibited in an appearance of kindness and acceptance. And that positive attention can be uplifting to anyone who falls beneath its spell.

High verbal skills

Dr. John Antonakis, a professor of organizational behavior at the University of Lausanne in Switzerland, does a good job of explaining this aspect of charisma:

The most charismatic people in a room, he says, are those who speak metaphorically, providing substance to a conversation through exemplary use of anecdotes and comparisons. They aren’t recounting events but paraphrasing action while using facial gestures, energetic body language and vocal inflections to frame key points. They’re experts at using moral conviction and reflections of group sentiment, as well as employing questions, even rhetorical ones, that keep people engaged. In short, they just tell a good story.

Story telling can be learned, however it is far more difficult to learn speak metaphorically, using analogies, anecdotes, and metaphors. And while many  charismatic leaders have a great sense of humor, I don’t believe it is necessary to be charismatic.

If you believe that charisma can be learned then by all means read the full Times article.  You can even buy a book on the subject, The Charisma Myth by Olivia Fox Cabane, one of the experts quoted at length in the article. But I don’t think charisma can be learned anymore than a sense of humor can be acquired. But there are certain tricks those who wish to gain our attention employ, such as the way sales people will use your first name in every other sentence. People can emulate certain aspects of charisma but like natural athletes charisma is born, not made, in my experience.

The truism in the startup world is that Cash is king. And it is true that without cash a business will eventually go out of business, as it won’t be able to compensate its staff and pay its bills.

There’s a standard question I ask a founder of a brand new venture: “What is the major asset of your company?” This usually promotes some head scratching, followed by answers posed as questions like “my idea?,” “my connections?”, my product?.  But the answer, which no one has yet given me, is none of the above: it’s you. Your expertise, your experience, your energy, your work ethic, your vision for the venture. The startup will go nowhere without its founder.

Many founders go months, or in one of my  favorite companies, years, without taking a salary from their venture. A determined, brilliant person can get a lot done with little or no cash; I’d take that person over someone with a million dollars in cash but zero creativity, a poor work ethic, and low energy.

But if the major asset of your startup is you, what does that imply? What is your major asset? Your time. I recently had a meeting in which the two founders had spent six months and a lot T & E money trying to sell to a large company, without success. As a founder you cannot look at spending your time like you could spend money. It’s always possible to get more money, but no one can work more 24 hours a day, 7 days a week. In actually, while everyone’s limit varies, most founders work about 70 hours a week.

The big challenge in a startup is how do you allocate scarce resources? How how should a founder allocate their resource of time? I have come up with a term I use to answer this question: ROTI – Return on Time Invested. If anyone had taught these two founders how to sell they could have asked their prospect a series of questions before spending their literally precious time flying to Europe to meet with him. Asking questions of the prospect in the sales process is known as qualifying the customer. That means determining if your prospect – the person you hope to turn into a paying customer – has the ability, authority, and the inclination to purchase, and that the purchase meets your minimum amount to make it worth handling.

There is a secondary benefit to qualifying the customer, not only do you save time, you are less likely to pay an opportunity cost. Opportunity cost represents the benefits a founder misses out on when choosing one alternative over another.  The time you wasted trying to sell to an unqualified prospect could have been invested in turning a qualified prospect into a sale; not just generating current revenue, but also the potential to sell other products in the future to that customer.

The key question for founders thus becomes How do you manage your time? There are two vectors to time management: priority and alignment. Priority means you do first what is important, not what seems urgent. Secondly, what you do with your time needs to aligned or be in the correct relative position amongst your tasks. Time investment is like any other resource; tasks need to be arranged in order of their predicted return. For example, you have one customer where you have a 10% chance of making a $5,000 sale versus another customer where you have a 5% chance of making $100,000 sale. In the first instance you have a probabilistic  return of $500 (10% of $5,000). In the second instance you have a probabilistic return of $5000 (5% of $100,000). It’s clear that you should prioritize the latter sales opportunity and you shouldn’t spend more than $5,000, and preferably substantially less,  pursuing this potential customer. Sales and marketing lend themselves to this quantitative approach of how to invest your time. What about product development? QA (Quality Assurance)  had been one of the departments reporting to me in several startups. The QA team had to spend some of their limited  time classifying bugs (showstopper – must be fixed; UX confusion – should be fixed; and cosmetic or rarely occurring – might be fixed if the schedule permits. (This ranking gets reviewed by product and engineering managers, with special attention to show-stopper bugs, like losing data or crashing the operating system.)

When your company gets larger you need have a managers in place who can train their staff to manage their time by setting priorities and allocating their time proportionately based on the expected ROTI, such as increasing sales, generating fewer tech support calls, or developing more leads for the sales team.

Raising investment capital is very time consuming and frustrating for a founder who also has to build a product, recruit staff, manage their investors, and dozen other things. But it needs to be treated like any other task: what is the return on time invested? Is it worth the time to meeting with a VC who seems interested, but whose fund has never invested in  the market and customer you target? Couldn’t that time be better invested finding a VC with a portfolio of companies in your market? Qualify your investors!

Finally, stop  thinking of what you do as a founder as spending time doing X. No. You are investing time doing X because X has a high expected return or benefit. That could be timing the release of  a product (in time for an important trade show). What is the expected benefit of appearing exhibiting at a trade show? How many leads generated versus a direct mail campaign? But not every action can have a near term measurable benefit. Meeting potential channel partners at a trade show may be hard to quantify. But before you start investing time in finding a potential partner you need to determine the financial costs and  benefits, known as a cost/benefit analysis.

Do watch your cash! Unless they are independently wealthy, founders only have so much elapsed time they can invest in their business without drawing a salary, even a subsistence level one. Prioritize your investment in tasks or projects, just as you prioritize your spending – based upon an expected return. That way you can stretch the dollar and make running out of cash less likely.

The typical corporate response to this question is simple: give them more money, give them more power, give them more perqs!

But in the startup world we do things differently and this can give us a sustainable advantage over traditional companies.  We often lack the cash to give employees more money – founders themselves often go without salary for months. Founders tend to like flat organizations, power should be distributed based on need, not status. Perqs can be expensive, though enabling people to work at home or have more flexible vacation policies can benefit everyone.

But an article about Chief Design Officer, Johny Ive, leaving Apple has a different take on what it takes to keep a superstar like Ive happy. Apple tried all the big company methods of making Ive happy: reportedly the highest salary of Apple’s executives, a CXO title, ability to spend less time at Apple; the power to make product decisions. But they still lost Ive. According to author Minda Zetlin, Jony Ive Left Apple After Inattention From Tim Cook, Report Says, More money and the chance to work from home just weren’t enough – the title of her article.

Ive had spent 30 years at Apple. And the peak of those years were no doubt working with Steve Jobs, who took a maniacal interest in product design and development, as does Ive. Ive and Jobs were inseparable, eating lunch every, taking walks together, working together in the design lab. As Zetlin writes: Jobs was a visionary and Ive could bring those visions elegantly to life. It was a symbiotic relationship of the best kind.

Tim Cook is not a visionary and never claimed to be one. His forte is operations, and his brilliance at building, developing, and scaling Apple’s operations – the production and manufacturing of its products – was truly extraordinary and drove his rise to first Chief Operating Officer and then after Jobs’ death, to CEO.  But according to at article in the Wall Street Journal, Cook rarely visited the company’s design study. Without the fuel of Jobs’ design acumen and ability to see around corners, and his laser-like attention, the design study evidently lost momentum and Ive lost enthusiasm.

Minda Zetlin concludes with a paragraph that is so important, so well written, and so on point that I’ll quote it in full, adding just some highlight of key points:

Whatever the real truth is behind Ive’s departure from Apple, the leadership lesson is this: Nothing you offer a key employee can compete with the simple act of spending time with that person. Talking to the employee, getting to know him or her, and letting the employee get to know you as well. As with Cook and Ive, you may have very different views about what your company needs and what’s most important, and of course, as the boss, your opinion is what matters most. Some commentators are fond of saying that human attention is today’s most valuable and sought-after resource. If you want to keep an important team member happy, you have to spend some of that resource to do it.

Interestingly Apple made absolutely no effort to replace Ive. He was probably considered irreplaceable. Rather his duties were assigned to COO Jeff Williams. According to the press Williams is a sort of Cook clone, a master of operation but one who seems to take more of an interest in product design and development than Cook.  While Apple hasn’t had a hit product of earthshaking important since the days of Steve Jobs, under Ive the wearables product line of the Apple Watch and Airpods has grown to over $5 billion a year. It will be interesting to see what new products emerge from Apple’s labs over the next few years and how many are the legacy of Ive. But as a founder your job isn’t to pay watch what megacorps like Apple are doing (or not doing), it’s to pay attention to your company. And how you allocate your limited attention span will be critical to your venture’s success; make sure not to forget your employees.

Most founders I mentor are very early stage and unfortunately they tend to fixate on their idea to the neglect of building a team to execute it. Perhaps this shouldn’t be a surprise, as my mentees all come from MIT, a school of engineering. But it does surprise me how little thought is given to organizational design, recruiting plans, compensation and everything else that goes into building a world class team. Of course, ideas are important as are markets. But execution is what wins and it is the very rare founder who can execute solo – mainly an inventor who licenses their invention to another entity that brings it to market.

Diane Bryant, who spent 30 years at Intel then went to Google for a short time is now on the advisory board of a company called OWNZONES. She was interviewed in an article in Forbes.

Her three responsibilities as an advisor at OWNZONES are:

… I’ll be applying my three decade plus global and Silicon Valley technology experience to recruiting of top-tier talent, connecting OWNZONES to instrumental industry partners, and advising on their investments to further simplify the digital video supply chain.

Note that number one in her list is recruiting top-tier talent. And this Q and A with article author Johan Moreno explains why:

JM: When growing and scaling a business, what is one thing you have realized that money cannot buy? 

DB: Talent.  The best talent is not motivated by money, but rather by the opportunity to drive personal impact, work with others they admire and can learn from, and achieve team success.

The first limiter of every start-up I’ve advised is talent. The ideas are plentiful, the funding is available, the market is ripe.  Talent is the scarcity.  The best leaders attract the best talent. A leader’s job is to be a strong and compelling communicator of the vision and path to success, and then create meaningful and fulfilling opportunities for the employee to contribute and develop.

The caliber of talent that OWNZONES CEO Dan Goman has amassed is truly impressive and a key factor in my decision to join.  The technical domain expertise is deep and expansive, spanning cloud architecture, cloud-native application development, artificial intelligence, and video processing. Coupled with the technology expertise is an extensive knowledge of the media and entertainment industry and its market leaders. The foundation for business success is talent, and there’s no stronger a foundation than at OWNZONES.

If you take nothing more from this post than the bolded first sentence you will have absorbed a valuable lesson from a high tech industry veteran. To the best of my knowledge, Apple did not pay above market salaries during either of Steve Jobs’ reigns. In fact, they may have paid slightly below market rates. But what they offered was, in Jobs’ immortal words, the opportunity to “put a dent in the universe.” Apple was a mission-driven company and that mission, to make computing accessible to everyone by simplifying the user experience, was attractive to the the best talent in the world. And as the best talent want to work with the best talent (not just leaders, as Diane Bryant says, but as peers as well.) One of Steve Job’s many talents was the ability to spot talent and as a world-class sales person, to recruit world class talent. Burrell Smith, one of the key hardware engineers on the original Mac, was pulled out of the service  division by Jobs.

Google is another example of a company where recruiting world class talent was so important that one of the two founders interviewed virtually every new hire for years to ensure that only the best, brightest and most driven were hired.

Finally, as I explain to my mentees in search of capital, investors tend to rank the team as the number one criterion in making an investment. Not the idea. Ideas are cheap. World class teams are expensive and rare. A world class team will reject a poor idea and pivot to a better one, as Slack pivoted from games to corporate collaboration and communications tools.

There’s additional wisdom in Diane Bryant’s interview, but I like to focus on one main point in my posts and the main point from her interview is hire the best. Don’t settle. Give as much attention to building your team as to building your product.