Homework is not just for kids

I’ve found the practice of assigning homework in various contexts to be a very powerful way of learning about people, their capabilities, and their work habits. In hiring I often would ask candidates to prepare something relevant to the job they were applying for. This is now common practice, but I was doing it in the late ’80’s.

But it’s useful to entrepreneurs as well. In the process of customer development you will likely meet many people who are wildly enthusiastic about your project, some to the degree that they’d like to work with you in some way. Here’s where homework assignments can separate the wheat from the chaff. For example, if someone is angling to work with you as a marketeer – be it as a consultant, volunteer or full time employee – homework can help in your go no-go decision. You might task that person with coming up with a pricing strategy for your enterprise software and then recommend different pricing models, such as per machine, per user, per site, freemium, etc.

If they deliver on time that’s a good indicator. If what they deliver is useful, even better.  But if they fail to deliver or are very late or if what is delivers is not up to snuff, that’s very valuable information too.

It’s the rare person who would buy a car without a test drive. So test drive potential volunteers, interns, consultants, employees, et al. Hopefully you will both enjoy the ride and you’ll at least rent the car, if not buy it.

Hire slowly, fire quickly.

I don’t know the source of this maxim. But it is one a subscribe to fully and one I preach to entrepreneurs. Very early stage companies tend to focus far too much on headcount – how many people they have hired and not enough on other metrics, such as customer acquisition, engagement, retention, etc. In my high tech company the largest operating expense category is personnel and talented engineers and sales/marketing people are expensive. Expenses can easily out run revenue if hiring is ramped up to quickly.

Firing an employee (vs. a contractor) can be very difficult. If you are not careful in can even result in legal action. But if someone is not a fit with the organization, is made aware of the problem, and it can’t be solved quickly ,better for them and you to let them go quickly. That’s not to say inhumanely by marching them out the door the day you tell them they are terminated, but to avoid having problematic employees damage morale and hurt the company by continuing to underperform.