The point about all of these is not about destructive replacement. It’s about improving a product in the eyes of the consumer. And what enabled this improvement? Common standards, collaboration, user-feedback, guts, ruthlessness, innovation, progress, etc. Why producers don’t like to cooperate with that? Because every technology requires an investment to make it work.

Think of the poor embroiderer, which is what inspired this post (bound to get a lot of flack). It’s a funny industry. I wasn’t aware that needlework designs are being sold over the internet and thus at the risk of piracy. I suppose I always thought an embroiderer embroids, then sells their product and ships it to consumers. Instead, they seem to go to the simplest side-product of their work, the one that becomes a foundation for potential mass-production, the “design-chart,” which is then being “shipped,” via download, to customers. Interesting! It kinds of makes sense from a distribution standpoint. Customers are not willing to pay for the shipment of needlework, instead they prefer producing locally, which really is a great idea. The only problem here is the way it is distributed.

In a B2C relationship over the internet, I think, it always comes down to eliminating as many barriers as possible. When you buy from an online shop, you really want the product in your house as quickly as possible. If I could reach my arm into the screen in front of me and pull out the product that I just ordered, that would be just perfect. It’s worse when the product is digital, because the customer knows that it’s just bits & bytes really not worth anything tangible (I’m just talking about the 1s & 0s here) and it could be in the customer’s home in a millisecond. Instead, business erect as many barriers as they possibly can, whether it’s a big ‘copyrighted’ sign across a picture, an overly complex signup/payme page, or the somewhat convoluted iTunes-model, where it really is easier to pay than to pirate.

But in the light of evolution, these barriers are bound to be broken! The same reason why gold is no longer a form of payment, because it’s really heavy and annoying to handle, the world of commerce has a way of evolving towards something easier and easier and easier, until finally I pay by waving a magic wand (eh RFID chip) across a panel.

Let’s get back to embroidery. The problem is two-fold. 1. fragmentation, because any solution that I am about to propose will not get blanket acceptance. 2. the silly notion that selling designs, which seems like the most valuable thing an embroiderer has to offer (actual IP), is something that should be done in a direct B2C relationship. In the light of consumers constantly wanting to break barriers, this offering of valuable IP seems like an industry-defeating purpose.

So what are possible solutions?

• consolidation & protection. Basically the iTunes model, where everything is placed behind a secure window that can preferably only be accessed via a specific device (my personal belief is that anything bits & bytes will eventually be free as that is not where the real value lies).
• selling designs via local shops. If the problem is distribution, why not partner with local shops that keep your designs behind bars and just print out the end-product for consumers.
• selling designs via the machines that produce needlework. No idea what they are called, but they have a strong incentive to keep their machines being used and have a direct line to consumers.

I’m sure any of the above is a solution with problems, but my point is the following:

• Piracy will continue to exist and will become worse if you make it easy for people to pirate.
• Consumer products evolve in a fashion that keeps pushing out inefficiencies and piracy is one of the quickest ways online to remove these inefficiencies.
• The only way to prevent privacy is to not distribute anything that can be distributed via bits & bytes.

Case in point: the idiot that just walked into an Apple store and jailbroke every damn iPhone 4 on display.

Last point: I am not advocating piracy. I run a company myself, I have a business degree, and I believe in getting paid for your work. But I do believe silly strategies deserve to get punished. And there are plenty, plenty, plenty of them that I have mentioned on this blog over the years.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. The Internet does not make much sense… On pricing digital goods and other illogicalities
2. Yo, ho! Lessons from Piracy for industry dynamics
3. The case against software piracy
4. When analogies don't work
5. The Poor Man’s Business Model—How Out-of-the-Box thinking can generate tremendous value for customers

• Intellectual Property Protection (IPP)
• Revenues
• and Operations

Revenues is a straightforward concept and reflects market potential, market share, and business-model. Operations can also mean business-model as that clearly affects your operations, it also concerns the team, and it very much concerns *the last mile*—a very detailed understanding of how your product comes of the “factory line” and goes into a customers hands (every step and every screw has to be planned out). And IPP, well IPP is something special.

Intellectual Property Protection refers to legal and other ways that you protect the innovation and knowledge that is built within your company and its people. It is not as straightforward as simply taking out a patent, copyright, or trademark, though those are usually the first avenues that investors will pursue when talking to you about IP. IPP can just as much come from keeping information tacit—inside the heads of your team—, developing systems that spread an innovation across many parts—e.g. the way technology companies prevent copying from factories they outsource production to, by only giving them parts to produce, but not the whole—, another systematic answer could be deep vertical integration, which ensures a higher quality of products and services than can be replicated by vertically smaller competitors (a strategy pursued by Apple and Starbucks), and last but not least: speed—in some industries it pays to just scale very quickly, rather than build a protective base around IP (a contrast between e.g. web and medicine).

But let’s get real for a second. You’re an inventor, you developed something new. The most obvious path to pursue is a patent. The first issue is cost, because taking out a patent is not cheap. Basically, by filing a patent in your country, you can protect yourself for a while because there is a period, 1-2 years, I believe, where you are filing it and it can serve as a type of legal instrument to prevent other companies from filing a similar patent. But in the end, you have to shell out maybe €5000 per country to protect your invention internationally—and those costs do not cover the legal cost or protecting a patent once it’s being breached. Let’s get real x 2: you’re a startup and while your technology may be innovative, it may not be what the market needs (which can relate to actual taste, but also to cost, to regulatory issues, etc.) and that means that your patent, if you decide to take it out, may not be worth squat. Let’s get real x 3: your invention may not be unique, at least not in its current form, and pursuing a patent in that case is not even feasible.

So practically speaking, what do you do? Just to be clear, I don’t have the final answer to this, though it is something I am constantly thinking about as a potential risk in our, a technology startup. So my interpretation and approach are entirely my own, but I am writing this to start a discussion more than to give the final answer.

The answer to me is all about strategy. IP protection has to make sense in the context of a longer term business strategy, long term meaning to me longer than 2 years and preferably longer than 5 (if you have an actual patent and it has market value as well, you have over a decade of protection). And IP, just like a business, is something that can be split up to cover different areas related to supply, to the manufacturing, to the end-product, to the service, etc. So the more broad and comprehensive your way of protecting your intellectual value is, the less it can actually be replicated by your competitors.

All IP concerns aside, it is sometimes of benefit to not protect the whole value chain. This is true in our business, which I will write about some other time, where we can split up our technology into core-components that are integrated into new solutions which act as a platform for more solutions. Locking off that whole chain is perhaps of some benefit, but in some ways we would like to have people innovate in their respective areas and for us to focus on developing better products out of that. My point is that IP protection should be seen as something that can be shifted to those areas most critical to your business and that new development in your industry is not necessarily something to be scared of. In the end, we are in the product business and if we can produce superior solutions for customers that outweighs comprehensive IP solutions.

So the conclusion is, even if you are developing a product that is not entirely novel, there are places in the value chain where you can still develop an IP solution. And if you are developing novel solution, it has advantages on both the supply and the market side, to not make your IP too restrictive and thus diminish your product potential.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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2. Thoughts about Tech IT Easy, inspired by my time in Paris
3. The Poor Man’s Business Model—How Out-of-the-Box thinking can generate tremendous value for customers
4. The Euro vs. Dollar double gambetto for high tech corporations
5. Dassault Systèmes soon to turn to B-to-C

Sunk costs are part of reality. Every decision you make comes at the cost of not doing another one (opportunity cost) and as soon as you make a choice and invest in it, that money / energy is sunk / gone. The thing that counts then is to evaluate both the context under which the decision was made and the outcome of that decision. While it makes sense to not include sunk costs in a financial decision-making formula, a negative outcome does require taking pause before making new investments. Perhaps this is a European attitude to things, or a risk-averse one, but much of our thinking about forecasts is based on looking at past performance.

What matters most then is the context, and this, in a startup environment, is rather a complex affair. I’m going to draw some analogies with rocket building in the early 1900s, producing art (at any point in time), and staring at goats here. Art is, I believe, a calling that is very difficult to quantify. It is very strong amongst people that seem to be bad at everything else—just based on my own experience. In this case, you have no past performance to base future performance on. And art being a fluid craft where aberrations of the status quo seem to produce some interesting results (but also at terrible odds), it is nearly impossible to predict the future of such an enterprise. Rocket building in the early history of rocket building suffered from similar dangers, in that no one had done it before and it required cracking a great number of eggs before reaching the moon.

All of these are sunk costs that may or may not lead to greatness, and what I take issue with is to then ignore sunk costs in making future decisions. At what point is it justified to ignore sunk costs and at what point isn’t it? If the “staring at goats” division in the army spent half a century, eh, staring at goats, you could argue that it’s an investment in the future, but you could also argue that it’s a foolish enterprise—just for fun, I tried staring at the back of the heads of a few people standing in front of me in a supermarket, I did make a few scratch an (imaginary) itch themselves upon my specific mental request, but I can’t say that this “sunk cost” was a reason to invest some more energy into it.

When we made a financial plan for our startup, we didn’t give much thought to making the wrong decision, though that is a very important factor to consider at this stage. It is nearly impossible not to make a wrong decision when you’re building a rocket to go to a place no one’s gone before. What we did do were two things: 1. we researched as much as we could of the environment we were heading into and the tools & reality we had to work with. 2. Every, and I mean *every* decision that had to be made that involved a financial or time investment was scrutinised as much as possible beforehand. But… both research and execution can be flawed in that not all information may be clear—especially regulatory stuff can be a maze to travel through, as can understanding a science or technology—and execution depends on both good information and good people to execute. And the fact is, I believe with any startup, that we have incurred certain costs that can be considered sunk and gone. When we make the plan for the next stage, we will have to ignore those investments, as painful as they have been.

I’m a great believer in the lean startup. This comes from my father, whose whole life philosophy is based on a Ghandhiesque lifestyle that involves discipline, routines, and a leanness when it comes to living and working. I can’t say that this is exactly the way I want to live my life, but I do believe that the opposite, coming from an abundant lifestyle and trying to make good decisions, is more than often a formula for failure. Entrepreneurs and their startups should to a certain degree remain hungry so that the decisions they make are made with the desire to improve life. If you see the amount of hurdles that are presented to startups everywhere, you know that this attitude of keeping startups hungry is shared by many people.

A part of this leanness in decision-making is what I discussed before: scrutiny, scrutiny, scrutiny, among many a step of the way. But I have to frankly admit that this scrutiny can lead to a near bureaucratic way of doing business, which, to me, seems quite incompatible with creating great innovations that require some significant dreams. Dreams are your mind processing information in funny and interesting ways, and if there was an accountant sitting in the back of your head telling you to not dream this and that because it costs too much, it wouldn’t be much of a dream.

That brings me back to the role of sunk costs in decision making. One must be allowed to make mistakes when engaging on an enterprise. It’s quicker to learn from a mistake than to try to constantly prevent it. I’ve also been thinking quite a bit on the role of subsidies in early stage startups and the chance they present to make these mistakes. That, however, should be the topic for a future post.

My conclusion thus is that while entrepreneurship is a serious business, there can be little great ideas without some (in many cases considerable) room for experimentation. How you quantify this, I think, remains subjective. It can’t be Google’s 80-20 rule, where 20% of an employee’s time is spent on his own ideas. When you start, it should more likely be 50-50, with 50% being aimed at making good decisions and the other 50% at pursuing the dream that make those decisions have meaning.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. CIOs/Consultants: An insight into making better software/hardware/IS/networks investment decisions
2. An e’Diary part 1 – on the decision of becoming an entrepreneur
3. Why do startups fail?
4. Minutes of the IE-Club lecture at Microsoft France on European Rising Stars of the Internet
5. Dassault Systèmes CEO Bernard Charlès @ Capital IT

Here’s a list of signals a startup might want to send out (I will discuss these further below):

1. The quality of your idea/prototype/product (the whole range of what your startup is centred around)
2. The quality of the team
3. The quality of your associations
4. Your legal status as a company
5. Your financial situation
6. The satisfaction-quotient of your customers
7. The speed of growth, which is really a component of ‘quality’
8. Your location & office

I kind of threw a few in there, as you can perhaps tell, because for instance some signals can be bundled together into tangible vs. intangible signals, as well as technology, people, financial, legal, etc. You can of course also split op signals into external—to the outside world—and internal—to your co-workers or board.

Why does any of this matter? On a basic level, because we all care about showing signs of being good at something (and starting a business is a highly personal thing in which individuals determine the direction such a venture takes), and more practically, because startups are about bringing ideas to the world that do not exist yet.

Signals are about increasing your worth in the eyes of someone else. To go back to the list, the first one, product, should be obvious: either create a kick-ass product or find a kick-ass customer that really needs your product (the latter is more realistic).

No. 2, the team, is trickier, though still crucial. It’s about getting the right mix of people in a company; people that have different educational backgrounds, possibly different genders, different ages, different networks, etc. It’s tricky because any relationship risks becoming a liability if people don’t match (that’s a big IF). And because getting quality people doesn’t always come easy, either because you can’t afford them or because the type of quality you need cannot be measured on paper or elsewhere.

Three, associations are pretty straightforward. If I have a board-member that has a good reputation, that opens doors. If I have partners in a market that is my target market, that kicks ass. If I can stamp logos of companies on my product that already have a name, that’s great marketing. It’s not rocket-science and the only thing that is required is to make these kinds of connections happen, usually through the quality of your pitch, your product, and your team-members, each of which comes with their own network.

Four, legal status, is not so straightforward. For many companies, having LTD written next to their name is a sign that they reached a certain stage. But in of itself it means nothing, only if it actually makes sense from an accounting point of view. So this is actually something that I don’t think should be up to the entrepreneur, but to an accountant and tax-lawyer. Having LTD or equivalent next to your name is still sweet of course (though not if it costs you 1000s of dollars/euros to set up and you haven’t written your business-plan yet…). Another legal status symbol is having a patent or a trademark. Both are valuable only in certain situations and require a serious strategic analysis beforehand, not least because it is so expensive to maintain (between 6000 – 100,000s for a patent & that doesn’t include the legal cost of going to court over a dispute), but because if you haven’t done your homework, you could be spending money on protection that isn’t worth a damn. Legal signals always require the help of experts, which is why lawyers will, for better or worse, always be around.

Five, the finances, has consequences on so many things that it’s impossible to summarise it well. What kind of company do you have if you can’t pay your employees, if the effort you put into it isn’t generating any cash-flow, etc.? The answer is simply a bad one. Other positive signals here are having a high profile investor on board or, preferred by most companies, a high paying customer or 100.

Six, your customer, should really be number one. Again, what kind of company do you have if you don’t have happy customers? It’s not impossible that this is the case at the start, but there should always be room for making customers happy—interesting story about how Zappos decided to sell to Amazon because its stakeholders thought Zappos was investing too much time/money in increasing customer satisfaction. There will always be conflicts in regards to customer satisfaction vs. financial satisfaction. Another often underestimated problem is that one happy customer doesn’t translate to another. This is the topic of a little book called ‘Crossing the Chasm,’ which is about going from early adopters to the mainstream, different types of customers with very different values and expectations!

Seven, speed, is one that I don’t like, but became aware of through my studies of entrepreneurship. It’s crazy how much media-attention fast growing companies get, as well as how much government-attention. If you can grow to 20+ employees in 2-3 years, it wouldn’t surprise me if politician X gives you a call to thank you for the good you’re doing the economy. If you grow to 1000, the queen/president will probably shake your hand. On the other hand, there are plenty of situations, the internet boom & bust comes to mind, where speed is actually a detriment and it would’ve been better for the entrepreneur(s) to take better care of the foundations of the company (you know, building a profitable business), rather than focussing on the status of having a ginormous team. A debatable point, I know…

Finally, location, well who doesn’t want an office looking out at Manhattan or, in my case, some tropical beach somewhere (I don’t really need the office…)? Who doesn’t want to be able to invite clients and show them your shiny office, with plants, fountains, and beautiful people everywhere? As I hopefully made clear, sending out signals is fine and good, but it should always be weighed against what you give up and if you actually need it. Kind of the same thinking that should be employed when deciding whether to get a new Apple product or Aston Martin—will those shiny objects really make you more desirable to the opposite sex? Well, maybe a little

That was a little braindump. Hope you enjoyed it.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. My biggest nightmare if I ran a startup, and what I would probably do about it
2. 37 Signals : Digital Natives Leadership in action
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4. An e’diary part 2: what are the responsibilities of an entrepreneur
5. The Dynamics of Blogging and the Dynamics of Doing Business

Many thanks to @flapinta for pointing this one to me (french link). What a revelation !

Isaac Getz is is a professor of Idea, Involvement, and Innovation Management at ESCP Europe. He has been Visiting Professor at Cornell University, Stanford University and at the University of Massachusetts. He graduated in Computer Science, then obtained a M.Sc. in Management Science, a Doctorate in Psychology and a post-doctoral degree (HDR) in Management.

I usually don’t spend too much time providing information on the business thinkers I quote, but considering the content, I just wanted to make sure Isaac Getz is not mistaken with some kind of hippie smoking ganja on a beach in Goa.

With Liberating Leadership : How the initiative-Freeing Radical Organization Form Has Been Successfully Adopted (pdf) Isaac Getz received the accolade of French Management Union of engineers (SYNTEC) with the Academic Prize of Management (french link again).

This 26 pages essay provides us with further evidence that methods of management that arose in the 50s (Chris Argyris and Douglas McGregor), have been successfully applied by dozens of world class companies and market leaders in their area (Toyota, Southwest Airlines, USAA, Avis, WLGore, QuadGraphics, FAVI in France etc …) to foster employees engagement. The amazing thing is how they align with the management principles that are consubstantial to Enterprise 2.0.

In a time where leadership has never been so critical for businesses, some lessons to remember from this essay :

The key to F-Form organisations

Chris Argyris and Douglas McGregor researches converge in the 50s to the conclusion that traditional organization forms (organisation silos, command and control type of management) lead to failure.

In the 90s many companies such as Southwest Airlines or Toyota illustrated successfully Argyris and McGregor preferred organisation type : what Getz calls the F-form. In F-form organisations, employees have complete freedom and responsibility to take actions that they (not their bosses) decide is best.

Getz decided to study these companies to answer this obvious question : how come this type of organisation, yielding impressive economic results, have not been more generally adopted throughout the business world ?

What he found out : there is a common factor in all the companies where F-form of organisation prevail : liberating leadership. Enterprise without this type of leadership just can’t adopt this type of organisation.

All studied leaders understand the defining function of the organizational form they were building, to allow complete freedom and responsibility of employee’s action.

Nourishing people three universal needs

McGregor redefined the How to motivate people ? conundrum into a “How to build an environment where people self motivate themselves“.

Edward L. Deci and Richard Ryan studied organisations and proposed a self-determination (wikipedia) and work motivation (pdf) theory. This identifies a framework of non controlling environmental factors required for self-motivation : relatedness, competence and autonomy.

Beyond these environmental factors, they identified three universal needs that, once fulfilled, lead to self motivation :

1. need of being treated intrinsically equal,
2. need of growth
3. need of self-direction.

Creating an environment for intrinsic equality

Robert Townsend (CEO of Avis) published the Up the organisation best seller in 1967. Motto : once you’re in charge, remove everything you didn’t like as a subordinate and implement what you missed.

Robert was an admirer of Management Theory Y by Douglas McGregor. Alike other liberating leaders, he proceeds in what could seem to be an empirical fashion, adopting work practices that help treating people intrinsically equals and removing the ones that does not.

Principle thoroughly adopted for instance by Cristobal Conde, CEO of SunGard :

How do people get recognized? How do you establish a meritocracy in a highly dispersed environment? The answer is to allow employees to develop a name for themselves that is irrespective of their organizational ranking or where they sit in the org chart

It’s all about listening

This is a very strong and common trait of liberating leaders : stop controlling and start listening. There are some telling examples in Isaac Getz essay but the most impressive I know of probably is Paul Chambers CEO of Cisco (though not in the essay) :

I had to move from a command-and-control leader to a collaborative one.” Collaborative leadership means “letting go” by involving others in decision making, listening to ideas.

The are good reasons behind the listening key. Jeff Westphal CEO of Vertex provides the Wisdom of Crowds one in Getz’s essay. But the main one is that when people genuinely are listened to, they feel intrinsically equal.

Creating an environment for people to grow and self direct

With all the studied companies and organisations, Getz’s team has witnessed a strong focus on making sure the company encourage self-direction. Among other examples, the essay explains how USAA (insurance company) does not measure the performance of the call center on the number of calls handled per hours but on the number of customer problems solved during the first call.

What really is interesting here is that the company provides the guidance (take care of the customers by fixing its problem in one call) rather than the control (count the number of calls addressed by employee). This did not prevent USAA to top Business Week 2007 and 2008 (2nd in 2009) customer service ranking US wide.

Fostering culture-keepers

Another common principle with liberating leaders : they are the culture keepers. There is a strong will to foster this. We live the culture (Terri Kelly CEO of WLGore – link to her video).

And there is a will just as strong to make sure nothing can damage it. Getz gives the example of FAVI, an amazing french company building brass gear forks auto parts. This company has experienced a 3 decade long double digit free cash flow and solid margins, moving from 0 to 50% of market share in an industry where its European competitors are, at best, at a loss, and in most cases has disappeared.

In the 25 years of the company, Jean François Zolbrist (great french blog post by @pmeance including a video of JFZ explaining FAVI principles) didn’t dismiss people whose job became useless. But he did promptly fire 3 people for malfeasance as they were not treating people intrinsically equals.

This brings us back to how Brad Bird protects innovation in Pixar by getting rid of passive-agressive people.

Main values

All the leaders of the studies company share the same values :

1. Freedom and responsibility values. As Bil Gore said : “Freedom is is the great motivating power of individual human beings”.
2. Creativity : A survey from IBM’s Institute for Business Value shows that CEOs value one leadership competency above all other : creativity. One of the observed main feature of their creativity, is the ability to rephrase problems to find solutions more easily.
3. Wisdom : The ability to contextualise and the reluctance to fundamentally attribute errors to individuals

Be nice

Last remarkable trait of Liberating leaders, they make sure their F-Form organisation are considerate not only with their employees but also with their suppliers, customers and partners.

This brings us back (again !) to E. Goldratt definition of any company goals : be profitable, take care of the customers and take care of the employees.

By doing so, the F-Form companies develop trustful long term relationships.

A remarkable essay which sheds a great light on the “mysteries” of many successful and exemplary companies. It perfectly complements Gary Hamel best seller The Future of Management.

Now the questions : have you witnessed such type of leadership ? Have you experienced it ? How to implement such type of leadership in an organisation ? (My hint : it starts with E and finishes with 2.0). Let us know.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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1. Enterprise 2.0 : less control and more leadership
2. 37 Signals : Digital Natives Leadership in action
3. The management toolkit for an interconnected world
4. Beta equals Innovation, or another reason why I like the Business of Software
5. How to tell when Enterprise 2.0 is not appropriate for your organisation

As Enterprise 2.0 activists, we keep on trying to sell Enterprise 2.0 as the ideal solution for your organisation.

But to be completely honest, depending on your company objectives, values and culture it may just not work.

10 principles your company may have adopted that will make Enterprise 2.0 implementation counter productive …

1. Your company is not comfortable with innovation

It’s not a matter of being conservative, it just that your company culture loves it when nothing change.

Managers and employees alike have been doing the same routine job for the last ten years, they don’t want any innovation to emerge and disrupt the nice and quiet day-to-day work in real life business.

2. It is business critical to foster politics

Politics happens in any social organisations. So if you master politics, you master the organisation.

Your company loves it when people in the hierarchy feels they are powerful. This is the raison d’être of your enterprise. They have dedicated parking spaces, business card for travels, dedicated secretary, guaranteed pay rise and many other advantages.

Each department rates its own importance with the number of people they have and the cash flow they burn : that’s the way it is in real life business.

3. Strong managers are pivotal in the organisation

In your company managers have to be tough men, there’s no wimp in here. They have to be able to kick the butt of people lacking motivation to reach the company objectives.

They make it clear who is the boss during the very long meetings whose agenda is decided on the fly by the manager.

In addition, managers make sure any bottom-up or top down information go through them so they can filter and make sure they stay in control. A proof of how important they are : they spend 20% of their time fighting with their email box.

Taylor and Ford made it clear that’s the way you have to run your lazy resources to get the job done in real life business.

4. Employees are engaged or else …

The Company needs the engagement from employees. So either they engaged, either our managers kick their butt (refer to point 3).

Employees have to behave. They’ve been hired to produce and apply the methods, processes and strategy coming from above.

They are not here to ask silly questions that would disrupt the regular process.

It is OK for strong managers to take ownership of any of their employee successful contribution : this is what we call team spirit in the real life business.

5. The IT department defines the organisation

Nowadays you have to be VERY careful with IT security issues. As a result, IT has naturally emerged as the most important department in your organisation.

It is very handy for the IT department that all different department (Marketing, Sales, Professional Services, R&D, Product definition, IT) has its own hermetic silo : then we can ensure that all communication go through the Strong manager : this help preventing any security issue in real life business.

6. Collaboration is dangerous

In a similar fashion, collaboration is DANGEROUS. One could exchange information with somebody from another department without going through the manager. The latter would then be terribly upset and upsetting managers goes against your company core values.

Besides, it could happen that employees share information that is not 100% VALIDATED & CORRECT. Can you envision the disaster ? Your company can. Better be safe in real life business.

7. Employees need to know where to find stuff

In every company, people are losing an amazing amount of time searching for information. Not in yours, because employees HAVE to know where things are.

The IT department have structured what there is to know in directories in different network drives and in Real Time Database Management Systems. All your employees have to know is the name and location of every bit of information they are supposed to work with.

Who needs knowledge management system in real life business with disciplined and closely monitored employees ?

8.High Fear / Low Trust

In such a dangerous world as ours you don’t want to nurture a trust culture. You need your employees to be wary of any person they have not been working with for at least 5 years.

Besides, you make sure that any mistake is severely punished and ridiculed so that people don’t lose other people time with any idea/document they are not 200% sure of in real life business.

9. By IT workers for PC users

Your company is developing software. To be run on computer. Nowadays every man and his dog can use a computer.

So why should your teams ask any question to the customers and question the way they use your product ? Asking questions to your users is the best way to make them think you are clueless and lose market share.

To communicate with the customer, a couple of annual official corporate statements and ad campaigns are the way we do in real life business.

10. Business Methodologies are just a way for consultants to make big bucks

What’s the whole story with this Getting Thing Done fad ? How about these Agile projects ? Hey did they use Scrum to build the Pyramids or the Ford T ? Let’s be serious for a minute. Your company has been in the business for 30 years and it has been doing things the same way ever since.

Why should it change ? As if the world has seen any dramatic change since then. Hexadecimal numbers still go from 0 to F : there’s nothing new under the sun.

And don’t even mention business schools studies or academics : none has been interested in your organisation lately. A proof of how little they know about real life business.

Conclusion

If any of the above is true for your company, then Implementing Enterprise 2.0 is very risky.

It encourages collaboration and knowledge sharing for employees to be more efficient.

It fosters weak links, networking, questioning and associating : there could be the risk of some people discussing the same problem from different perspectives and come with some ideas or even an innovation.

It fosters employees engagement and helps leveraging flow of information to create value.

How scary. Better be safe : in that case make sure you stay out of Enterprise 2.0.

Can you think of any other principles that would make Enterprise 2.0 a no-go for an organisation (in real life business) ?

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. Enterprise 2.0 : less control and more leadership
2. Five Elevator pitches for Enterprise 2.0 adoption
3. Toward Enterprise 2.0 with Cécile Demailly
4. Enterprise 2.0 : the end of office politics ?
5. Enterprise 2.0 Forum – the 10 keys of successful projects

“On a sunny day in spring this year, I engaged on a journey with three other people, two of them strangers. We were here to do something important, something that had been playing for nearly two decades and had finally come to the resolution. The problem, my problem: this thing we were engaging on has been frayed with bad luck all these years. Anything that could go wrong, would go wrong, and a large part of me expected it to go wrong that day also.

The night before, I hadn’t slept well at all. Before going to sleep, there had been a lot of discussions about possible scenarios that day and one I considered significant one was that the operation would fail. But ok, (sh)it happens and it should never stop you from doing something. My real, primal concern were those two strangers. The fact that this had been playing for so long was for one reason and one reason alone: the object of our adventure was something very, very valuable and many people wanted in.

So my real fear was that I would die that day. That one or both of those strangers saw an opportunity to take control of the situation, perhaps with guns or by employing a gang of thugs to pull us over and leave us shot dead by the road. That thought dominated my dreams that night and I was more than apprehensive meeting the team for that day.

It all went well. While I couldn’t have been more nervous, I tried to hide it and act as natural as possible. I pretended confidence and while fate could’ve have still struck a negative note, somehow it didn’t.”

In a small way, I am a different man today then I was the many years being aware of a tragedy taking place.”

I write this not to write anything promoting entrepreneurship, but I feel it makes a strong point in relation to it. I do not yet know where we will be in three months, but I can see that we’ve come a long way in the three months preceding it. A large reason for this is to do with being open to change and being confident that going forward is often better than standing still. I still believe that good ideas are worth nothing without execution, but that execution is not just a matter of “doing things.” It’s about throwing your idea into the wild a little bit and seeing what “the wild” makes of it.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. Project Wonderful
2. Vincent’s E’ship Diary Part 10: Thoughts on Selling
3. E’ship diary part 3: Why I don’t like the term ‘entrepreneurship’
4. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks
5. E’Ship Diary Part 8 – On the Marathon of Starting a Business

Bertrand Duperrin makes an interesting analogy in his post Will Adam Smith drive business in the future ? His take :

(…) Opposing a top-down and directive model an emerging relying on the existence of an “ invisible hand” that, in the same way as Adam’s Smith theory in economics, would make people personal actions and choices contribute to a collective purpose without the need of organizing anything.

I guess the difference between the enterprise and the market is that within the former, people (ideally) are working with the clear goal of collectively creating value and making the company richer. While in the latter the goal is to individually create value to make oneself richer.

Bertrand then sets a table comparing Enterprise 1.0 (strict), 2.0 (anarchy) and Rationalized 2.0 (ideal organisation).

My take : Bertrand’s Rationalized 2.0 is Enterprise 2.0 with a strong and clear leadership. The invisible hand in Adam Smith Enterprise is the leadership.

Leadership is doing the right thing while management is doing the things right (Peter Drucker).

Usual suspects 2.0

Offering more organisational freedom to employees is suicidal if it’ not carried out under a strong leadership. Looking at the usual suspects in terms of bottom up organisations these companies have strong principles.

Whole Foods Market have strong purposes and causes that are underlined by Gary Hamel essay The Future of Management.

Cisco‘s CEO John Chambers has completely revamped Cisco to build the whole organisation around collaboration as main core value. This transformation has been carried out based on five pillars, first of which being change of leadership style.

WL Gore Terri Kelly CEO on her company organisation :

WL Gore has guiding principles : freedom, fairness, commitment and waterline. this creates engagement, empowers team et voila : business results. People are leaders in our company only if there are people to follow them. (…) Leaders at WL Gore are not bosses. They earn their leadership, they have followers, they live the culture, and they explain rationale behind their decision.

37Signals is another great example of an amazingly successful company with strong principles. No-nonsense, get things done, technology alignment on objectives, think small, do less but do better, financial independence, etc … Strong principles are so pervasive in the company culture that they even infuse the web development framework (RubyOnRails) they have created : Convention over Configuration is the motto being the whole framework.

Agree on what to do

These guiding principles act as clear boundaries and define the frame within which employees are given freedom to organise their activity. They provide visibility and guidance.

Since the foundations of the collaboration the enterprise and the employees agreed on upfront are principles on what to do rather than processes on how to do, they naturally give more freedom to employees and are a bedrock for trust.

Organise and Control Vs Lead and Engage

Thinking about it, this is probably what scares the most leaders out of enterprise 2.0. It is not possible to hide : they need to show a strong and clear leadership to frame the collaborative work. There is no workaround if they want to fully benefit from bottom-up organisation that empowers employees.

Leadership is not granted. As Terri Kelly reminds us : it is earned. Organising control is dead easy. Leading to engage people is not.

This brings us to the first questions an organisation should ask itself on its way to 2.0 : do we have a strong and clear leadership ? What are the principles and purposes on top of which we want to build our whole collaborative environment ? Are these clear and strong enough for our employees to take ownership ?

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. Liberating Leadership, intrinsic equality and world-class businesses
2. How to tell when Enterprise 2.0 is not appropriate for your organisation
3. 37 Signals : Digital Natives Leadership in action
4. Five Elevator pitches for Enterprise 2.0 adoption
5. How Enterprise 2.0 nurtures employees engagement

Every startup starts great, I think. You (and your team, if applicable) feels a sense of elevation, of engaging onto a route that brings rewards, wealth, and joy to future customers (of course the entrepreneur is usually the 1st customer). This hazy phase is necessary to get the necessary adrenaline for the rest of the trajectory. It’s like a warming up, the important difference being that the more you structure your plans during that phase, the more strategically you can dedicate energy to different steps & actions.

Continuing with the analogy of a run, we have reached the marathon phase. We’re running on the limits of our “bodies,” which contain what energy we have pumped in before, what survival strategies we researched, and what supplies we managed to take with us. Both in a marathon and in a startup the vision of the destinations should be strong. It starts with much socialising with other runners, perhaps with some personal trainers during the preparation stage. But eventually, we realise two things: there are lonely routes to run during that marathon. And eventually, it’s a race too and only a selected few can win.

So what am I learning during this marathon?
I may have mentioned this before, but I envisioned my role in the company as different then it is now. I drafted a contract for myself with a set of deliverables that relate a vision outlined in our business plan. One deliverable is keeping that business-plan updated as I know that these plans hold little value as static documents. But essentially, it’s about getting our product to a certain stage and our company to a certain stage, and that’s how I phrased it in my business-plan.

As a CEO, an important part is learning to let go of the definition of a “job” (singular). A CEO must be a generalist and be able to do a number of “jobs” (plural). Not to a great depth, but enough to get each member of the team to do their job well. That means that, in my company, I have to understand how our products are built and help build them. I have to understand design and help my designers. I have to understand marketing and help my team there. In the end, there’s three things to realise about being a CEO: a good percentage of your time is spent on people management and you have to learn to delegate a lot of things. And last but not least: the final responsibility is always yours! You can fire an employee for doing a bad job, but you are always to blame for the outcome. So there’s no excuse, ever!

A runner’s most important asset is his brain. In regular intervals, he has to observe his body and his environment and make a decision about what the best actions are at that moment. Going downhill = move faster. A long road to the next water-source = conserve your supplies. A runner close to you = know his and your strengths and weaknesses and decide whether to run faster, slower, or at normal speed.

The startup’s most important asset is leadership, which fulfils the same role as the brain during a marathon: evaluate internal resources and the environment and decide what step is best to take when.

I hope to have a few more general blog posts on entrepreneurship left in me. But for now, the sun is shining and the future looks bright. But we also need to conserve our supplies to the next water source, and run at sufficient speed to meet both our milestones and reach the finish.

All my entrepreneurship diary posts can be followed under the tag ‘Vincent’s eDiary.’ I don’t write about what we do as a company on purpose, but you can always ask in the comments or via the email address on the right.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’Ship Diary Part 4: what to pay attention to when starting a business
2. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
3. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks
4. E’ship diary part 6: on the important matter of product design
5. An e’diary part 2: what are the responsibilities of an entrepreneur

Marketing aside, it’s hard to write about something that continues to evolve. What is a permanent truth is that you get presented with a lot of information, challenging problems, and Choices (with a capital C) all the time, and I wouldn’t exchange this period for anything (except for a bit more sleep).

The Uncertainties
Today’s post will be about managing uncertainty, which is really at the core of my job description. I wrote about technology, market, people, and other risk before, which is a way to abstract what is happening.

What really is happening is that you have multiple people in a company, each has their own job, not each does it in the same (predictable/independent/insert apt term here) way. These people have to build or build upon often multiple technologies that may or may not exist yet. All of that needs to happen before the project runs out of money. You need to involve external parties who have to like what you’re doing, enough for them to give us stuff for free, invest in our stuff, and/or buy our stuff. Risks from all angles but oddly enough it feels fine.

Lilypads allround
In a draft I wrote a few days ago and don’t want to bore you with, I compared it to the following:

Entrepreneurship is different. You may love doing a certain activity more than others, but doing so may very well come at the price of success. If I were to try to describe the feeling, I would say it feels like jumping from one lilypad to the next and keeping them all floating in the same general direction. I can spend more time on one lilypad because it houses a nice frog I like or because the sun’s shining on it just right. But eventually, the pressure would push the leaf into the water and I would drown. Or something to that (slightly nightmarish) effect.

This isn’t that bad, of course, or rather if you think it’s bad, believe me: you’ll get used to it! I wasn’t prepared for this, but I knew it would be hard and now it’s just an everyday thing.

The best way to deal with all these lilypads is to learn to be efficient and to spread the love around equally.

Gut instinct vs. calculated risks
During the early days of my master in entrepreneurship which was supposed to teach me all this stuff, we tried to analyse “the entrepreneur” from the psychological, sociological, and economical perspective. The most frustrating part about it was the psychological side because every academic paper and article seemed to compare the entrepreneur to a superman. It probably didn’t help much that plenty of those articles were written during the .Com days where we all worshipped entrepreneurs many of which later turned out to sell very good smelling air.

One thing that struck me, however, was the concept of “calculated risk.” Entrepreneurship isn’t a risky venture, it is an exercise in calculated risk. I didn’t get what that meant until very recently.

As mentioned, our company is composed of several people, all of whom are different and work differently. I have people that need structure, people that hate structure, and people that seem to jump from one lilypad from the next, with me, the “boss,” chasing after them. In one way I hate it, in another way I really want people to find the best way FOR THEM to work, though of course respecting the general reality of our situation.

I am taking a risk there, but the crucial part is that I do so in a calculated manner. And that is more literal than you think. For example:

We have a very clear vision of where we want to be in several months time, but there are alternative paths to get there. One would be to build upon existing technology, which would involve a slight adaptation but at a very high financial cost. The advantage is that we have a ready to go product, the disadvantage is that we have to calculate the higher cost down to our customers. That’s ok, if it wasn’t for path no. 2.

No. 2 would require building something from the ground up that would interface with an existing technology, except that it allows us to create something much more impressive (and innovative!), as well as build a series of cheaper prototypes until we reach the mature prototype phase. Cost of production would be the same in the end, except that we can produce 10 versions of our product for the same price. The advantage is a superior product for the consumer, the disadvantage from a developmental stance is that instead of a minor adaption such as in path 1, we spend more time on this part, time we could allocate to other areas.

These are pretty much once-a-week decisions that I have to make, and a large part can already be decided by instinct. It is better to build 10 cheap prototypes than 1 expensive prototype. But how much better it is can also be calculated out in time and material cost in a simple excel sheet.

How I choose to interpret “calculated risk” is that it is actually calculated. Risk is simply uncertainty and uncertainty means that there are alternative paths to a destination and we don’t 100% know which is the right one.

You can apply this to plenty of other things, such as how to design products for different business models and how to design companies for different investors. It is amazing what clarity it brings to quickly crunch the numbers when a new idea is introduced that appears to derail the whole project. After calculating the cost of that choice (the “risk”) it may in fact bring the project to a whole new level!

I still consider myself a visual thinker where ideas are concerned, but I am becoming more and more convinced of the power of “the numbers” in turning ideas into commercial innovations. There is a risk to spending too much time in them, of course. Who hasn’t heard of forecastoritis, also known as the hockey-stick financial forecast. Life doesn’t work that way and while any forecast over a longer period of time ends up looking like starting with a large minus that turns into a larger plus, the best forecasts actually reduce the minuses to a minimum. I see a large R&D budget as the equivalent of a welfare state that just sponsors those types of people that don’t really ever want to make money: the scientists. They just want to build things and love an endless R&D budget. What they don’t realise is that when a company actually makes money, part of that money will be used for R&D anyway, which actually becomes an endless development budget! But only after you have a viable cash cow that makes it happen and only if development continues to generate continuous revenue opportunities. Ok, that last paragraph was a bit of a rant…

All my entrepreneurship diary posts can be followed under the tag ‘Vincent’s eDiary.’ I don’t write about what we do as a company on purpose, but you can always ask in the comments or via the email address on the right. Pictures are courtesy of the great M.C. Escher and nature.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks
2. E’ship diary part 3: Why I don’t like the term ‘entrepreneurship’
3. E’Ship Diary Part 8 – On the Marathon of Starting a Business
4. E’ship diary part 6: on the important matter of product design
5. An e’diary part 2: what are the responsibilities of an entrepreneur

Towers Perrin has published the results of a Global Workforce Survey they made about employees engagement. The survey has involved about 90,000 people over 18 countries. The objective was to rate the level of engagement of the people in their work.

People are split into 4 groups depending on their level of engagement :

Engaged: Those giving full discretionary effort, with high scores on all three dimensions.

Enrolled: The partly engaged, with higher scores on the rational and motivational dimensions, but less connected emotionally.

Disenchanted: The partly disengaged, with lower scores on all three components of engagement, especially the emotional connection.

Disengaged: Those who have disconnected rationally, emotionally and motivationally.

What Towers Perrin found out does not give much credit to management : only a fifth (21%) of the workforce is engaged, twice as much (41%) feels enrolled, a third (30%) feels disenchanted and almost a tenth (8%) feels disengaged.

Costs of lost engagement

This excellent study also shows the cost of lack of engagement. On a three-year study, companies with high employees engagement show a positive evolution of operating margin (+3.74%) while companies with low employee engagement show a 2% reduction of their operating margin.

In addition, it shows that this engagement strongly affects the belief people have regarding the impact they can have on the company innovation, productivity, costs, growth and customer satisfaction.

Three conclusions from this report :

1. The global workforce is not engaged — at least not to the extent that employers need their employees to be in order to drive results.
2. Engaged employees are not born, but made
3. Employees worldwide want to give more, but they also want to see a clear and measurable return for their effort.

Now : let’s see how and where Enterprise 2.0 can help in nurturing engagement …

How to close the engagement gap ?

Tower Perrins provide three axis along which management can make a difference in creating a more engaged workforce.

1 – Engaged Leadership

2 – Shape the work environment.

3 – Puts employees under the microscope

In addition, the report provides the Top 10 engagement factors for employees. Based on real life Enterprise 2.0 stories, we’ll see how these collaborative platforms answer all these employees requirements along the 3 axis identified above.

1. Senior management sincerely interested in employee well-being.

Enterprise 2.0 platform helps leaders to communicate with the workforce. With blogs, leader can engage in a conversation with employee. And conversational communication is key for leadership.

Paul Otelinni from Intel or, more recently, Ben Verwaayen of Alcatel Lucent are examples of leaders who has fostered Enterprise 2.0 platforms to exchange directly with their employees (blog for Otelinni, Ask Ben for Verwaayen) and show leadership engagement (management axis #1).

2. Ability to improve skills and capabilities

Coming from an open source background, I can guarantee that there is no better place in the world than inter connected network between people with similar area of knowledge to learn, locate experts and support and develop new skills.

I am still surprised this does not happen behind the firewall apart from those companies that have implemented Enterprise 2.0. One has to be very persuasive to convince me this is not necessary for knowledge workers productivity.

These collaborative platforms are genuine tools to shape the work environment (management axis #2).

3. Organization’s reputation for social responsibility

By providing a mean for customers, communities and citizens to openly discuss with brands and corporations, Enterprise 2.0 Social Tools allows for more transparent and visible policy regarding the social responsibility.

The Nestle Vs Greenpeace story in social media shows how harmful it is in the 21st century for company to neglect their social responsibility.

4. Employees’ input into decision-making

Gary Hamel essay Future Of Management describes how Enterprise 2.0 Prediction Markets have made wonder in Best Buy, thanks to a manager fascinated by the theory of James Surowiecki book Wisdom of Crowds.

It has been quite a tough one for the bunch of internal experts/analysts from the company. But at the end of the day, people felt more engaged as their input was taken into account and the company made more profits.

5. Quick resolution of customer concerns

Again, in Future of Management Gary Hamel explains how adding organisational layers between the workers and the final customers made knowledge workers losing sense and responsibility about their contribution.

By reducing the feedback loop and offering the space of conversation between employees and customers, Enterprise 2.0 provides the framework for quick resolution of customer’s concerns while helping knowledge workers to make more sense out of their contribution.

6. Setting of high personal standards

In his book, The 22 Non-Negotiable Laws of Wellness, author Greg Anderson wrote, “When we change our perception we gain control. The stress becomes a challenge, not a threat. When we commit to action, to actually doing something rather than feeling trapped by events, the stress in our life becomes manageable.” (Setting High Personal Standards – ezine articles)

In the excellent series about Implementing Enterprise 2.0 at Booz Allen, Bill Ives reports that thanks to professional profiles in the implemented solution :

There is also a greater sense of individual responsibility as people are better empowered to manage their identity in the firm and their career development. The Hello tools provide both greater control and increased transparency. So the firm is now more global, and at the same time, more of a collection of empowered individuals rather than a collection of partially siloed teams

7. Excellent career advancement opportunities

Again, with the People Profile feature in Hello platform Booz Allen, Bill Ives notes that

A person is more likely to get staffed on a project that reflects the interests and experience noted in their profile. They are also more likely to find the right contacts and intellectual capital to allow them to succeed in their areas of interest contributing to their preference to stay with the firm.

This goes back to my definition of enterprise 2.0 : the empowerment of knowledge workers. Providing professional profiles to employees allow them to have a greater control on their career.

Last but not least, these professional profiles and open contributions to conversation provide the company with an opportunity to put the employees under the microscope (management axis #3).

8. Challenging work assignments that broaden skills

Enterprise 2.0 offers more comprehensive understanding of the company and the business as a whole via conversations. Besides it also provides networking possibility with weak-links people the employees wouldn’t hve been in contact with otherwise.

And these weak-links are instrumental in getting new opportunities : studies show most career opportunities occurs via weak links.

9. Good relationships with supervisors

As Susan Scrupski puts it, trust is the currency of anything social.

Enterprise 2.0 open and easy platforms are a bedrock for transparency and trust, hence a better relationships with supervisors.

10. Organization encourages innovative thinking

Professors from Harvard Business School, Insead and Brigham Young University have completed a six-year study of more than 3,000 executives and 500 innovative entrepreneurs, that included interviews with high-profile entrepreneurs. They have identified five keys that drive innovation : Associating, Questioning, Observing, Experimenting, Networking.

Enterprise 2.0 collaborative platforms are the obvious management toolkit for knowledge workers to

• Associate with people from different background,
• Observe internal processes and user experiences, `
• social Network,
• Question experts and whoever involved in the project,
• Experiment and get an instant feedback from all expert on the domain on the business value of their proposal.

Refer to my Enterprise 2.0 presentation (How Collaborative platforms fosters knowledge, productivity and innovation) for a more detailed description on this subject.

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Now that you know how make your employees happier, more engaged, more productive and more innovative, you just need to refer to the 10 keys of successful projects to see how to implement Enterprise 2.0 in your company and increase your operating profit by 6%.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. How to tell when Enterprise 2.0 is not appropriate for your organisation
2. Five Elevator pitches for Enterprise 2.0 adoption
3. How Enterprise 2.0 fosters Knowledge Capture
4. The management toolkit for an interconnected world
5. Positioning with other IT systems: the liquid nature of Enterprise 2.0

But startups don’t work this way and the entire reason for working in a team is that you share the work and hopefully create synergetic effects (1+1=3!) in the process.

And the truth is that even as for non-technologist like myself (I am a geek though) designing products is not so hard.

I had a discussion with an industrial designer (my all time fav. people to hang around with) concerning the term ‘a perfect product.’ Her field understands the term as a product that functions perfectly, I choose to add “for the customer” to that definition.

The start of product design is always to ask: “so is this cool for people?“, meaning will they like it, do they need it, will they pay for it? I don’t think all question can be answered from the start, except the one of “is this cool?”

A very big part of entrepreneurship is sales, and as they say: you have to believe in what you sell. Easier when you already have a product, I’d love to sell Apple computers for a living, but when the product doesn’t exist, you have one of two choices: one, you design the product yourself, starting with “is it cool?”; two, you trust that your CTO can design something cool.

That’s not a problem, except for one thing: is cool something we decide or the market decides? It is of course the latter and one bullet point in an entrepreneur’s job description missing from that of the CTO’s is keeping a close eye on the market.

Therefore, product design is absolutely something entrepreneurs cannot delegate! And on that short note, I’ll leave it.

All my entrepreneurship diary posts can be followed under the tag ‘Vincent’s eDiary.’ I don’t write about what we do as a company on purpose, but you can always ask in the comments or via the email address on the right. Picture courtesy of The Esoteric Church (of all places!).

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
2. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks
3. E’ship diary part 3: Why I don’t like the term ‘entrepreneurship’
4. E’Ship Diary Part 8 – On the Marathon of Starting a Business
5. An e’diary part 2: what are the responsibilities of an entrepreneur

Good ideas also reside in intersections between different modes of thinking. I don’t know who made up the idea of the ‘execution multiplier for ideas‘ (Derek Sivers posted it on his blog once), but an idea is worth little without someone carrying it out. Similarly, in Neil Fiore’s book “The Now Habit” (the ONLY self-help book I would ever recommend to people) he writes about the source of good ideas, which often come when you least expect it: on your breaks, your holidays, anywhere which is not work-related.

While productivity is a great thing and crucial to executing ideas, idea-generation itself is actually not very compatible with the productive mind. But it’s not impossible to combine the two either.

Let’s look at a sample workflow from problem to idea generation to product (product meaning the outcome of idea generation, which has to lead somewhere):

1. You have a problem (duh… no really, don’t come up with an idea if it doesn’t solve a problem!)
2. You discuss it with people to try to figure out it’s parameters —what is the true gist of the problem?

This is a good time to get stuck. Where do you go from here? Do you go the left-brained route — the super-rational approach that would e.g. benefit from some number crunching in Excel? Or do you take a right-brained approach — the artistic approach of drawing out the problem further on a white board or an outliner?

It of course depends on the complexity of the problem, but it isn’t time yet to go super-rational all of a sudden. It breaks you out of creative solution mode and gets you into execution mode, which is really brain-dead “getting things done” mode. Before you get things done, you have to define “things” much further.

The next step in my process would be:
3. draw out several solutions, preferably in a group, and discuss them and the logic behind it. Is it an elegant solution to the problem? Does it solve it or does it complicate it? What scenarios are there and what are its parameters?

As soon as you come to scenarios, we come into process mode. And this is where a more left-brained approach of calculating resource-allocation (people, time, money) absolutely makes sense. In my last post, I was hoping that someone would have a good way of making this more compatible with step 3, I am still waiting for someone to come up with a good solution, however.

4. calculate it out. What are the costs associated with each solution, what are the benefits of each solution?

Costs vs. benefits could also be called expenses vs. income on a financial projection for a startup. Solid resource allocation is ultimately the lifeblood of a company, however in an early stage it is also the language to use when looking for funding for your company.

I don’t want to be too rigid about this; I’ve struggled with the process of “problem -> idea generation -> execution -> product” in the past and think that it’s an area that benefits from several approaches and also leads to more-than-several pseudo-suggestions on how to approach this.

Rather, I thought to expand a little on yesterday’s post and clarify why I really do want a more visual Excel (for lack of a better term). If you want to combine right- and left-brained perspectives, a white board alone won’t do it and Excel alone won’t do it. I want software that does both.

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. The Right Mix between Idea and Execution
2. A very old economy business to new economy business action plan
3. CartoRéso: a turnkey project for an entrepreneur without an idea (software or network engineer preferred)
4. Rebooting entrepreneurial brainstorming sessions: what elements should they contain?
5. Where do Good Ideas come from?

What I want is a combination of this:

And this:

And what I’d like to do with it is drag & connect different modules together and have it auto-add the end-sum when multiple modules are linked.

Any help appreciated, thanks! I have no reward for you at the moment, except if you’re in the Netherlands or I’m in your country, I’ll take you out for a drink and I will definitely pimp your site in this blog post if you include it with your awesome answer!

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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1. A Network Mapping Software – perhaps my University project this year. Inputs most welcome.
2. Network Mapping Software Project Kick-Off
3. Project Management: COST is the only thing that matters
4. CartoRéso: a turnkey project for an entrepreneur without an idea (software or network engineer preferred)
5. Project Management & Software engineering: the 'cost of non-quality'

As I mentioned before, I was asked to join this company as CEO after consulting them on the commercial applications of this exciting new technology. Joining a year later, we had a good understanding of the strengths and weaknesses of the current organisation. During the consulting stage, I wrote a business plan with a fairly clear time line (to me and our sponsor), but it wasn’t being executed upon as required. One of my the deliverables I set myself was therefore to get development back on track, which not only respects the resource boundaries (financial, human, technological) we face, as well as sends out the signal that we are a serious business.

One thing I keep hearing over and over from entrepreneurs is that you have to be comfortable with ambiguity. And that is absolutely true. We continue to iterate on ideas based on changes in technology, customer and partner feedback, and our own ideas, something that would drive any sane man crazy, but we have to keep it under control. The best way that I find to do that is continuing to develop the vision of where we are going (the strongest motivator I can imagine) and maintain a loose type of project management that gets us to that goal.

I call this project management, as it deals with schedules, milestones, and resource allocation over a period of time. Uncertainty is an important factor to consider in this. In a large company, chances are you’re dealing with a predictable environment, in an early stage startup this is not the case. Getting a tighter schedule in place continues to be a challenge we are working on, however I find that being alert, flexible, and adaptive all the time contrasts with the more stable art of project management. Please correct me if I’m wrong, in which case present a solution also! Of course, there have to be thresholds in place, which to me is very much defined by risk assessment.

Regarding risks, let me start by saying that not all risks can be addressed, which is why being comfortable with ambiguity is so important. And second, there are many different types of risk, technology, financial, market, etc., but one usually outlines the thresholds that you have to respect. In my case, I see this clearly as market risk, as nothing matters if your customers aren’t buying… however, this really is not something to take for granted.

In medicine for instance, which is traditionally patent-based and largely dependant on a complex regulatory process, you have a 15 year window, of which you can spend up to 12 years developing your super-innovative cure. Clearly the technology risks outweigh the market ones (note: this ignores the rise of generic, cheap, knock-off drugs). In the web-industry, on the other hand, it’s perfect for rapid prototyping, it’s hard to protect innovations and easy for competitors to clone them, and it makes much more sense to push out your products asap. That means that there can be plenty of competition and the risk lies in grabbing sufficient market share to make a (sustainable) profit.

In our case, we are not as “high-tech” as medicine and not as “high-market” as web-development, in the sense that we face both market and technology risks. However, I see market risks as more important and try to align both market & technology approaches together. As an example, one of the things we did several months ago, was demo our technology to the general public and to selected partners. After the experience, we interviewed them thoroughly on their experience, as well as their initial expectations. We want to make sure that people don’t expect something different than what we deliver and that our product meets and exceeds their expectations. That gives us a clear view of where we want the product to go.

On a technology level, that presents us with certain thresholds in terms of “the experience” and price-points. And whenever we face a technology change, whatever solution is being developed, it has to fit within that end-picture the customer expects. That also overcomes the problem of black-box development, which is not uncommon in technology development.

So, that’s more or less how we continue to develop the vision for our company and the project management that supports it. We started with a lucid dream of producing great technology. We demoed initial versions and tried to align our vision to the needs of our users. And we end up (hopefully) building what our customers want and pay for. I would love to do this in a web-environment, as that really makes prototyping so much cheaper and quicker, but we do the best we can with our not so intangible technology.

All my entrepreneurship diary posts can be followed under the tag ‘Vincent’s eDiary.’ I don’t write about what we do as a company on purpose, but you can always ask in the comments or via the email address on the right.

The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
2. E’Ship Diary Part 8 – On the Marathon of Starting a Business
3. How to avoid Development Hell
4. A review of a great Project Management Institute lecture on industrial outsourcing and agile software development offshoring
5. E’ship diary part 6: on the important matter of product design

I have been thinking about this topic for a while now. Enterprise 2.0 book from Andrew McAfee chapter 8  (Looking ahead), a nice twitter conversation with @oscarberg, and a New York Times article about Microsoft Creative Destruction : all combine to convince me there was some room for a blog post. Snip from the NYT article :

Internal competition is common at great companies. It can be wisely encouraged to force ideas to compete. The problem comes when the competition becomes uncontrolled and destructive. At Microsoft, it has created a dysfunctional corporate culture in which the big established groups are allowed to prey upon emerging teams, belittle their efforts, compete unfairly against them for resources, and over time hector them out of existence. It’s not an accident that almost all the executives in charge of Microsoft’s music, e-books, phone, online, search and tablet efforts over the past decade have left.

As Wikipedia defines it :

“Office politics is the use of one’s individual or assigned power within an employing organization for the purpose of obtaining advantages beyond one’s legitimate authority. Those advantages may include access to tangible assets, or intangible benefits such as status or pseudo-authority that influences the behavior of others. Both individuals and groups may engage in Office Politics.”

One has to be extremely pedagogic to explain me how on earth this may help the company in being more profitable, increasing customers satisfaction and being a better place for employees, the three goals of any company according to Eliyahu Goldratt.

The Transparency test

Throwing such concepts as Trust and Transparency into the discussion is a good method to identify the politics freaks out there. Transparency is their worst enemy : manipulating and controlling information is their favorite way to achieve their goals : intriguing to keep and strengthen their positions and power (as Oscar puts it).

They’ll soon show the standard behavior pattern of politics : denial and/or cynisism and standard resignation. “It’s not that simple, it just can’t work like that, You just can’t change that, that’s the way it has been and that’s the way it always will be etc …”.

I am very defiant towards these people. More often than not, this is somehow to excuse their own questionable  behaviour. My take on politics jerks : The No Asshole rule.

Office politics specialists of the world unite ! Because you will soon die and no-one will shed a tear on you. Enterprise 2.0 is near the corner : trust and transparency will eventually rule the work place and the exact nature of your contribution will clearly appear : poisonous, irrelevant and damaging. We shall then follow Robert Sutton advice : get rid of you.

Model 1

Chapter 8 (Looking Ahead) of Enterprise 2.0 book is, according to me, the most engaging and impressive. In that section, McAfee describes how the egalitarian and transparency values of the social platforms born on the internet may not be very welcomed in some companies.

To illustrates this, he mentions The Liar’s Club, this weekly executive meeting in a company where some people lie to each other regarding their budget, progress etc … to make sure they are not the ones the blame is put upon.

He then goes on and mentions Chris Argyris people behaviour models in organisations. Argyris describes two types of model. Model 1 is defined with the following principles :

1 – Define goals and try to achieve them.

2- Maximize winnings, minimize losings

3- Suppress negative feelings :

4- Behave rationally

ChangingMinds offers a clear description of Model 1 limitations :

In order to acquire a sense of control we need to prove to ourselves that we can control our environment. We thus set ourselves goals and do our best to achieve these goals. In order to maintain our sense of control, we tend to do this unilaterally — to include others is to risk losing control

We all like to win, because this proves to ourselves that we are achieving our goals and are in control. On the other hand, if we lose, we not only do not achieve our goals, but we are seen by others as inferior and are likely to receive less support in the future (thus we lose social control–i.e. power). Winning (or losing) becomes a spiral as the more people ally with us, the more others will feel socially isolated and be motivated to join us.

There are many ways we can experience dissonance in the actions from the above approaches (how well we achieve our goals, what we lose …). We will tend towards avoidance, denial and suppression. This suppression can be a collaborative action — I won’t talk about your limitations if you don’t talk about mine. This is a hugely poisonous spiral that leads entire organizations into sub-optimal and dysfunctional ways of working that can eventually bring down the entire company.

We all need to predict  the world around us, including what other people will say and do. A defensive way of being rational is to judge the rationality of others, thus setting ourselves up as authorities and hence automatic winners. Blaming people and situations is to  attribute cause, which is itself a rational action.

Even if these 4 principles may sound legitimate at first, soon the the trade-offs become obvious : it focus on individuals hence foster ego centric decisions and actions. Defensive communication, problems and mistake denials, stealing other people’s ideas and results (in France we are world champions), blaming, bitching and gossiping about people, brown-nosing, manipulating information … In one word : politics.

Model 2

As an alternative, Argyris proposes another behavior model based on (from Wikipedia which tends to prove that Tables are not Wiki specialty):

1- Valid information : Design situations or environments where participants can be origins and can experience high personal causation (psychological success, confirmation, essentiality). Actor experienced as minimally defensive (facilitator, collaborator, choice creator). Quality of life will be more positive than negative (high authenticity and high freedom of choice)

2- Free and informed choice : tasks are controlled jointly, Minimally defensive interpersonal relations and group dynamics, effectiveness of problem solving and decision making will be great, especially for difficult problems, Increase long-run effectiveness

3- Internal commitment to the choice : Protection of self is a joint enterprise and oriented toward growth (speck in directly observable categories, seek to reduce blindness about own inconsistency and incongruity), Learning-oriented norms (trust, individuality), Public testing of theories

4- Constant monitoring of the implementation : open confrontation on difficult issues, Bilateral protection of others

The second model is based on valid information, choices, commitment and monitoring, all within a team activity. This is transparency. And transparency is a bedrock for trust.

As this is less individual centric, this second model is more open to the possibility of admiting mistakes (a great enabler of office balanced relationships) : it makes assertive communication natural and the only way to go.

From Model 1 to Model 2

This will resonate with a strong echo for any of us that have witnessed these top managers meetings where one hardly talks not to make a mistake and undergo a scathering attack by other managers. This is just dreadful.

McAfee concludes that :

ESSP can help organizations move from a Model 1 to a Model 2 theory-in-use. These tools can change the nature of collaboration and discussion within the enterprise giving people the ability both to contribute their perspective to a dialogue and to inform themselves by incorporating multiple perspectives. In short, they can help organizations move from defensive to productive reasoning(…) Enterprise 2.0 is about abandonning the assumption that unilateral control is the best way to achieve desired outcomes.

This is my favorite part of the book as this sounds to me the most enlightening.

While implementing Enterprise 2.0 and moving from Model 1 to Model 2, would we eventualy defuse office politics and focus, at last, on the main goals of private organisations : profits, customers satisfaction and employees well being ?

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. How to tell when Enterprise 2.0 is not appropriate for your organisation
2. Office Live's simplicity rocks: the case of software company PipoSoft
3. Enterprise 2.0 Forum : the Jive side of Swiss Re project
4. Toward Enterprise 2.0 with Cécile Demailly
5. A word to Jason on Mahalo's extravagant office

This will be a short post. I think that the Internet has proven to be a two sided coin. It brought us freedom of information, but bits are also information, which makes it hard to gain value from them. Looking at it through a business lens (a flaw of mine) I can’t help but wonder if programming is a worthwhile direction to take, if you want to make money at least.

The other side is what I wrote about in paragraph one. Code produces wonderful things and I am grateful everyday for the fruits of that labour. So I sincerely hope that my world, the business world, will continue to allow for “the code” to reign free, and for those that produce code and its products, to reap the rewards and continue to do what they love.

So I apologise for whatever I wrote previously, namely that software is not high-tech, i.e. innovative, because it simply does not apply to all code (just to the 100s of 1000s of me-too apps and websites out there, which ruin it for the good ones).

This post was inspired by Fred Wilson’s post “Code As Craft” and by one of our interns producing “beautiful code.”

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. Is software high-tech?
2. The Poor Man’s Business Model—How Out-of-the-Box thinking can generate tremendous value for customers
3. Theory: Why No One Cares about Video on the Internet
4. Christmas Address
5. What would an Always-On Device look like? Do we even want it?

1. your relationship with the company & people you’re starting with: coming out of a position that involved reading a lot, a lot of contracts, I’m kind of particular about how to phrase them. I like the idea of contracts if they very clearly state the boundaries of your position and the relationship you have with others. It should also clearly state the deliverables that have to be met, though that can also be included in a separate “action plan.” A good contract should leave no room for misinterpretation, which is why it took about 3 weeks and 8 draft-revisions to get it just how both me and the company wanted it. Of course, a 1 person business doesn’t have to do this, nor someone that doesn’t get paid, though both in “hobby (that become) startups” situations and multi-team startups, it’s good to have a thing on paper that states a number of things including responsibilities & shares, as well as, if possible, time-frames for carrying out the job. You don’t need a lawyer for this, it’s best to start with a simple list of what you want to achieve and work from that. Very important is to mention what national law this contract falls under (e.g. Dutch law or French law), full names & addresses, etc.
2. your intellectual property: I’m kind of running up against something like this now, which is why I think it’s worth mentioning. IP has different values in different industries of course, but in my industry, a high-tech non-software one, it plays an important role. Not only is it important to dedicate certain resources at protecting your IP, you also have to watch out that others don’t lay claim on it, just because you spoke to them once or twice (or worked there at some point. The Mattel vs. Bratz case is an interesting one to follow for that.). IP protection also plays a part when talking to outside parties like investors. Last but not least, it does protect you against copycats, though, as mentioned, the value of patents or similar varies from industry to industry.
3. your own finances: They say that you should have enough saved up to not have to work for 1 year. I’ll just say that I made sure that I do have a comfort zone, though not so much that I won’t stay hungry (lesson 101 in entrepreneurship and raising (rich) kids: instill a hunger for success).
4. the company finances: at my last company, my job was to handle certain business affairs for companies that have their legal address with us. Company finances are a complex affair, and plenty of swindlers out there try to get out of taxes here and there. Not that I don’t sympathise, but be careful of not signing something that makes you responsible for someone else’s problem. Something similar occurred last year, where someone signed something that nearly (!) made him responsible for ca. 1 million euros in unpaid taxes. Let’s just say that the lesson was to have complete transparency from the start and not sign if it doesn’t exist. Preferably this should be specified in the contract (point 1) also. The other side of the coin is that the company has to become a financial vehicle for the people working there. That means that managing its finances (income and expenses) is vital to making sure that there’s also enough money to pay all the costs.
5. staying organised: Kind of obvious, a chaotic entrepreneur doesn’t make for a good entrepreneur. As I have about 12 different jobs, I have to make sure that I don’t forget what needs to be done, to prioritise the important things at the right time, and to delegate those tasks that I have no time for or someone else is better suited for.
6. staying healthy: I’ve seen three people pass away that I’ve had a professional relationship with. One was of an advanced age, one had a deadly disease, and the third passed away at a very young age of medical complications. Two of these were entrepreneurs, and both let themselves get carried away by stress. Stress means: less sleep, eating crap-food (my new term for fast-food), and not taking the time to exercise. It is not where I want to end up, I want to do a good job (it is just a job) and live long enough to reap the rewards (preferably, I’d like to live forever, but that’s a future startup).
7. staying connected to people: as a first time CEO, I have a lot of questions and the best way to have them answered is to ask them to people that are smarter than me. Luckily, there are many, many smart people out there, and people love talking about that which they know.

That’s it for now and all I could fit into 30 min. of writing. All my entrepreneurship diary posts can be followed under the tag ‘Vincent’s eDiary.’ I don’t write about what we do as a company on purpose, but you can always ask in the comments or via the email address on the right.

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’Ship Diary Part 8 – On the Marathon of Starting a Business
2. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
3. The Dynamics of Blogging and the Dynamics of Doing Business
4. What I dislike about business plans [addendum]
5. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks

The popular associations
The word entrepreneur has two popular and a third upcoming association. One association is negative, that of a risk-taker and in some ways a loser—this would be more in a European context where job-security is highly valued. The other is positive, that of a potential Bill Gates or Steve Jobs, i.e. the smart entrepreneur who sees a big opportunity and has the drive, intelligence, and access to other resources to make it very big.

Of these two, the latter is what we are all aiming for, but realistically that applies to less than 1% of entrepreneurs today (using the very broad definition of someone that starts anything from 1-man webdesign company to an ambitious cure for cancer). The first association is also a misunderstanding of entrepreneurship, as entrepreneurs are not blind risk-takers, or at least they shouldn’t be. I would say and hope that it applies to a minority of entrepreneurs also.

The third association: a career-choice
The third association is that of an upcoming trend: entrepreneurship as simply a job. You’ll find plenty of job-adverts with “entrepreneurial attitude a plus” or similar in the job-description, a term I hate just as much as the often mis-used “business development,” standing for just B2B sales.

Added to the job-description part comes that there are plenty of entrepreneurial courses and full academic programmes available to the public, one of which I enjoyed, though I know from personal experience that that doesn’t make a person an entrepreneur.

A third factor contributing to the ‘entrepreneurship is a job’ association is easier access to the marketplace. I’ve had some online discussions with Cecil Dijoux on this blog about today’s technology culture in the context of enterprise software development, and there is as much a democratisation of software-/web-ware development, as there is of other increasingly “low-tech” industries. (As a side note: My definition of low-tech is a technology something has very low barriers to developing it.).

I think that the abundance of resources (not just) in regards to programming, to very well developed (internet) distribution methods for getting products, tangible or intangible, out to customers, as well as more-and-more programmes for funding/assisting startups, means that entrepreneurs have access to a better developed funnel where it comes to their profession of gathering resources and marketing their products.

That doesn’t make it easy, and actually brings other challenges like being one tree in a very large forest, but it does mean that it can be seen as a type of job.

Now, what is there not to like about the word ‘entrepreneurship’?
Maybe it’s a personal thing, but I feel very uncomfortable telling people I meet that I’m an entrepreneur. One, I do see it like a job, a job that I have to do well, and nothing special really. The term ‘entrepreneurship’ makes it sound fancy, which it is not. Two, I’m a European and I do feel the same association that many Europeans have to the word, which is that it’s “less than a real job.” Rationally, I don’t think that’s true, but emotionally I have found myself feeling the following initial reaction more than once when someone comes up to me and describes himself as an entrepreneur:

“Get a job, you hippie!”

Add to this that a startup is not a company until it makes money, and an entrepreneur is not an entrepreneur until he makes money doing what he does.

So I think the term ‘entrepreneurship’ is glorified, perhaps invented to make entrepreneurs feel like they’re doing something special, same as the term ‘Artist’ or ‘Inventor.’ Art isn’t art unless the audience considers it so, and people have invented plenty of mousetraps that are now collecting dust in a garage somewhere.

Suggest something new please
I’d like a new term for what I do and maybe you can suggest one. It should perhaps be related to a startup, which immediately summarises what is happening: A company that is starting up and isn’t there where it wants and needs to be yet.

The problem is that an entrepreneur is not always in the same class as a startup. He can be 50 years old and have a long and successful career behind him. Would you call him a “starter,” a term often used for people fresh out of college applying for a job at Consultant X or Multinational Y? Generally, entrepreneurs are responsible for the activities that happen in a startup in order to make it a success. Their chances of success increase if they have prior experience, resources, and networks to build upon, that make it easier to access the three pillars of “starting up,” as I’ve summarised in the picture above.

In regards to the above, I personally like to describe my work as “I’m running a small company and we’re developing a new product X,” but that is also a bit of a mouthful.

The other side of the coin is that entrepreneurs are in (desperate) need of marketing, where glorification does play a part. I read somewhere that entrepreneurship can be described as the process of developing something irregardless of resources currently in possession. That suggests a pitch is necessary, and perhaps already being termed an entrepreneur helps getting a foot in the door. I doubt it and it would personally bother me if that’s all it took, but I’m smart enough to realise that we “entrepreneurs” need to do whatever it takes to acquire resources, as long as it fits our code of ethics of course.

So, entrepreneurship, yes or no? I don’t like the term, but I may be stuck with it. If I come up with something more apt, I’ll let you know. And same for you please!

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
2. Catching up on software and entrepreneurship books
3. E’Ship Diary Part 8 – On the Marathon of Starting a Business
4. The Poor Man’s Business Model—How Out-of-the-Box thinking can generate tremendous value for customers
5. E’ship diary part 6: on the important matter of product design

One thing I found out is that it’s hard to put your responsibilities down on paper… there are so many!!! There is of course a basic job-description, which more or less sounds like that of a project manager/pull-the-rabbit-out-of-the-hat magician: “make it happen that we go from this thing on paper to the product in the hands of customers.” “Make it happen” is a super-loaded phrase, which can mean countless things.

There is a continuous struggle between micro-management and keeping the overview. Micro, because it is your responsibility that every (little) thing is carried out by your employees (if you have them). Overview, because You the entrepreneur are The Organisation. There is a third struggle that shouldn’t exist really, that between your professional life and your personal life. I’ve come to the conclusion that the only way to do this thing well is to focus on it exclusively. Friends, family, love, …blogging… it’s a nice luxury to have, but it comes second place.

The responsibility of an entrepreneur are thus: have a goal and make sure that everything is executed to get to that goal.

In a technology company, there are matters of technology and business (really, in what business except for strategy consulting isn’t there a mix of “technology,” which can mean anything from cooking to software development, and the commercial side of things, which is meant to pay for everything?). What I found was that as someone with a business background, who sort-of-kind-of has an idea about product development, and has a better grasp of business development, I still can’t let go of the reigns of product development entirely.

Product development ties in directly with business development. People are unwilling to pay for something that doesn’t exist and similarly our budget is supposed to last us until we have something worth paying for or investing in. Therefore, as an entrepreneur I have to make sure that product development stays on track. The absolute best way to do this is to have a capable product development manager in charge. The truth of it is that startups by their nature are resource-poor, which includes tripple-A product development managers (probably employed at multinational X or Y somewhere), and there is a lot of learning/training on the job. Learning/training means that the (hopefully) existing product development manager (in our case yes) still has to be managed, through schedules and regular meetings. In any case, product development is in its conceptual stage a very brainstorm-friendly activity, which means the more the merrier. But ultimately, a startup must get beyond this stage, respecting the entire resource-poor situation that a startup usually faces.

So, responsibilities of an entrepreneur as far as the technological product development is concerned: If you have a product development manager, you have to make sure that he works under the realities of the business. If you don’t, which I imagine many 1-person software startups operate under (as well as those lucky strategy consultants), well then you have to do the job of product development as well, keeping a close eye on the business realities.

OK, the business part of things. My role is fairly well-defined here as I come from a business background and approach startups from a business perspective. Assume that role 101 is having a firm grasp on everything that goes on, which can be phrased as “where are resources (people, time, money) being expended at and is it wise to do so.” This entails having a good budget plan and sticking to that.

Role 102 is to build the business, which I call business development, but that often gets confused with sales as that that is what it says in job adverts. Business development is the building of the business, which includes sales, but also includes building the company and all that entails.

So, we are trying to get from point A to point P, how do we go about it? If product development is about turning an idea into a product, business development is building a business plan into a business. Business plans are total BS unless they contain validated information. Some key-chapters in business plans are the market overview, the market approach, the time-line, and the financial need to meet all these objectives. Business plans can serve as a. cannon fodder, b. a plan of approach, c. one of several signals to attract investment. For c. no investor will take a look at your business unless you have a plan of approach (b.). On that plan, there should be a time-line, which you are following (predictability!) and there should be a goal: the market you are targeting and your approach.

The market section of the business plan presents a big problem for technology entrepreneurs. Because (non!) customers often don’t know what they want. I can ask a target group “what kind of air do you like to breathe?” and it wouldn’t surprise me if a significant number of responses would say: “I like to breathe air that smells like perfume.” OK, that’s a terrible question, but what I mean is that people sometimes make up answers that have nothing to do with reality (that said, both the perfume business and the fast-food industry have made lots of money from essentially selling air that smells good. Scent is also plays a very important part in memory, but I digress…)

What I’m a big fan of is validated market data, which is data gathered from actual customer experience with your product or part of it. That brings forth another problem of a bias towards early (and over-excited) adopters, something which the book “crossing the chasm” deals with, but is really not something that I think is realistic to address at an early stage, except that validated market data can also come from experts in the markets you are targeting.

The implication is also that product development is again completely tied in with business development which leads us down the path of rapid prototyping, another practice that works great in software / on the web, not as easily (though not impossible) with hardware. In any case, the experts in this area most well-known today are:

• - Steve Blank, who wrote “The Four Steps to Epiphany” and is currently hosting the excellent Stanford’s Entrepreneurial Thought Leaders seminars (btw. Steve Blank also writes a great blog on customer-focussed development, which I’ve only just started reading.
• - Eric Ries, who authors the blog Startup Lessons Learned and has some great articles on responsible (=lean) development.
• - And Donald Reinertsen, who wrote an incredibly dense book called “Principles of Product Development Flow,” a book which is clearly an authority in the field, but which I cannot recommend to any sensible entrepreneur with a 60hr/week schedule. Those principles, by the by, number in the 100+.

As well as of course Toyota and plenty of other experts out there, I’m sure, many of which are referenced by the people mentioned.

I think that it can safely be said that task 3 or a sub-task of business development is working towards the customer, the lifeblood of a business.

There are other tasks of course, which have to do with human resources, legal work, accounting, etc. Some of which can be outsourced, some of which can be done half-heartedly (oh no, I didn’t say that), some of which are really-really important, etc.

All these tasks, however, require a certain authority. The entrepreneur’s responsibility is to either be an authority on a task level or to be sure to work with authorities, either in the company or in an (informal) consulting fashion, so that they are carried out responsibly.

Task 4 can thus be entitled: be an authority on the tasks that need to be carried out or have access to one.

So, a whole can of worms starting a company can be and it is vital that it does not interfere with the single most important thing that you must do as a human being: be healthy! Health is part sleep, part exercise, part food, part love. There is no yin without yang and vice versa. Thus forget everything I said about personal life being no. 2. The best is if it reinforces what you do in your work. Health leads to happiness and happiness leads to optimism: a key-quality in entrepreneurship if there ever was one.

So the responsibilities of an entrepreneur summarised:

• 100: keep your eye on both sides of the court: the goal & the resources needed to get to that goal
• 101: align Product development with Business development
• 102: always validate your market data by staying close to your customers
• 103: be an authority on the tasks that need carrying out or have access to one
• 104: stay healthy and happy.

This was written in a single session with minimal editing. I hope it kind of makes sense. Part 3 of my e’diary will be on the topic of: can you prepare for entrepreneurship? As I have a master in entrepreneurship, I thought it might make for an interesting perspective. All my entrepreneurial diary posts can be followed under the tag ‘Vincent’s eDiary.’ By choice, I’m being mysterious about my company. If you have questions, feel free to comment or write to me via the email address on the right.

Picture courtesy of Be The Dream.

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 6: on the important matter of product design
2. E’ship diary part 7: Gut Instinct vs. Calculation, or On Managing Uncertainty
3. E’ship diary part 5: project management and vision development in the face of ambiguity, technology and market risks
4. E’Ship Diary Part 8 – On the Marathon of Starting a Business
5. E’ship diary part 3: Why I don’t like the term ‘entrepreneurship’

Who wants to be an entrepreneur?

Inspiration, aka new ideas or thinking out of the box, primarily comes from taking time to have new experiences and meeting new people. It’s too easy to get stuck in a rut when spending 9 to 5 in an office. Reflection comes some time after getting things done and so my words today will be mostly about stuff that happened some time ago, during 2009 in fact.

You’ll often find pre-/post-/non-entrepreneurs arguing about whether e’ship is something you’re born with. I think it’s arrogant to argue either way. E’ship is the pursuit of opportunity weighed against the opportunity cost of pursuing something else. Entrepreneurs are not formed in pre-school, running a lemonade stand, it just makes sense at a particular time and environment. And in this case… it made sense to me.

Flashback December 31st 2008. I received a call from an inventor that had read about a previous experience of mine in a technology business and asked me to help him with the business plan for a new venture exploiting a similar technology. As it was something that appealed to me I said yes. The project turned out ok, we secured seed funding to develop the technology, and I moved to Luxembourg for a job in finance, while staying on as a silent advisor in the tech startup.

Flashforward 9 months. The startup was finally ready to demo the technology which had so far only existed in our heads. It’s an important qualifier, not only for our business partners and investor, but also for the team and myself. While we had discussed something similar before, it was at this point that I was asked and considered to run this company.

To go back to “what makes an entrepreneur,” you’ll often read about entrepreneurs being a. all-invested in a venture (as opposed to investors, who diversify their risks across multiple investments) and b. Entrepreneurs having to make (relatively) calculated risk decisions. And that is what I did, I made an, as much as possible, rational decision whether I wanted to commit fulltime to being an entrepreneur in this venture. So that was my decision process, which required serious thought, consultation with friends and family, and more.

End of part 1. In part 2, what are the responsibilities of an entrepreneur. You can read all my e’diaries from now on under the tag Vincent’s ediary. If you have questions, obviously I’m pretty mysterious about our business, post a comment or mail me via the address on the right.

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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But how good is this wave of mergers and acquisitions for the future? ( By future I mean upcoming innovation and future of Startups which target innovation not business)

Whenever your biggest competitor takes you over, it blunts the competitive spirit that can drive innovations. Thats what concerns me most, the spirit of innovation is somehow compromised because of takeovers.

Not always always a potential Merger or Takeover can be taken as a positive sign of ever increasing competition and globalization. And particularly not right now when it comes to web and social media startups, many of which are still more focused on innovation and building up audiences than on making profits. Rushing them into deals to fulfill long-delayed plans for an exit strategy could derail the evolution of a strong business plan.

From an investment standpoint, founders and venture capitalists have good reasons to cash out now. Market caps of public tech giants are rising — the Nasdaq gaining big time – and so are their cash stockpiles. For Instance Microsoft has a stock pile of about $49 billion in cash; similar is the story of Google with $24 billion. High-profile Multi Billion dollar deals like the ones we had in recent times have a way of spurring on other acquisitions.

TimeWarner buying AOL and eBay buying Skype come to mind. Even snapping up a hot startup for its technology or talent — Google buying Dodgeball or Yahoo buying Flickr – can lead to culture clashes, customer anger and other disappointing results.

I  tried to re-compile the list of some major takeovers which are substantial enough to change the future of computing.   We are talking about some multibillion dollar mergers and acquisitions, where the Big gets even Bigger.

Oracle eclipses the SUN @ $7.4 Billion

This Merger can be coined as “father of all the Tech Mergers” announced last year. If the announced the deal went through, Oracle,  the industry’s largest database software vendor would get an entry into the server and storage markets worldwide.

The acquisition, still pending, was announced in April, and may even be blocked because European regulators are contending that combining Oracle’s technology with Sun’s open source MySQL database would violate competition laws. Lets see if this deal goes through.

Xerox snaps up ACS in $6.4 billion

Another major takeover, Xerox pays about $6.4 billion in cash and stock for Affiliated Computer Services (ACS), a large IT and outsourcing firm. With this merger Xerox hopes it will give it a bigger foothold in the business services space. While the deal will surely boost Xerox, investors wondered whether it overpriced the deal.

Calling the ACS deal “a game-changer” for Xerox, Burns, CEO of the company, said it would help Xerox “expand our business and benefit from stronger revenue and earnings growth.” The deal will triple the service component of Xerox’s revenue to roughly $10 billion annually from $3.5 billion, according to the company.

Dell – Perot Catch-Up Deal worth $ 3.9 Billion

Buying Perot was a part of Dell’s plan to expand its footprint in the IT services market, which was  a necessity in a time when hardware sales were falling. Dell offered a staggering $3.9 billion for Perot Systems, a 68% premium over Perot’s actual stock value. Dell’s purchase can also be seen as a response to rival HP’s $13.9 billion acquisition the previous year of EDS — another services company founded by Perot.

Cisco-Tandberg worth  $3.4 billion

Cisco, already a major player in collaboration products with WebEx and TelePresence, signed an agreement in October to purchase videoconferencing vendor Tandberg, which makes both video devices and network infrastructure products. The acquisition, if completed, could have both a direct and indirect impact on Cisco’s bottom line, because expanded use of videoconferencing may increase network traffic, letting Cisco sell more switches and routers.

HP Acquires 3Com For $2.7 Billion

HP launched a straightforward assault on Cisco in their own Game of Networks. HP’s increasing influence in data center networking and convergence markets will have a big boost with its purchase of 3Com, a maker of switches, routers and security products. HP says the acquisition will further its data center strategy “built on the convergence of servers, storage, networking, management, facilities and services.” The acquisition of 3Com also help to expand HP’s Ethernet switching offerings, add routing solutions and significantly strengthen the company’s position in China thanks to 3Com’s strong presence in China. The transaction is expected to close in the first half of 2010.

I have collected the figures and numbers from various sources including PCWorld, Gigaom and Wikipedia. Let me know if you have a suggestion or correction to make. Please forgive me for the grammar, I was always bad in Grammar since school

Article Previosuly mirror-posted by me at Global Thoughtz.

Anand

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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With this idea behind I am trying to categorize the tools which may be helpful for our readers to use according to their needs. Here are some twitter tools  along with the snapshots which impressed me and according to me will be easy to use even for a newbie to  promote his/her business .

1. Buzzom Premium http://premium.buzzom.com/

Buzzom Premium is very newly launched application which allows you to focus in your twitter growth. It has many functions to choose from but more essentially its spam filter, scheduler and monitor. These are the three basic functions over which the application is build.

Direct Message is full of SPAM and it is almost unusable now. Thanks to various gaming applications and welcome or thank you messages. I like Buzzom SPAM filtering for DM. It actually makes this feature usable.

Buzzom also provides a great way to visualize your Twitter growth and network’s activity such as tweets, Retweets etc. The service also has the auto grow and follow system to increase your network’s size. Scheduler allows you to schedule tweets at certain time and control it by specifying its repeat cycle for future tweets.

2. Twonvert http://www.twonvert.com/

Twitter is all about 140 characters of words. People are already got use to expressing themselves in 140 characters with shorthand notation and some ingenuity. But that takes time and when you are in hurry, its more frustrating. With Twonvert you can easily convert your tweets into SMS shorthand language and allows you to say more with less characters!

3. Wefollow http://wefollow.com/

WeFollow is the directory of all the people in the Twitter, who have added themselves to the list. It provides an easy way for you to find relevant people in twitter and connect with them. You can find all short of people from celebrity to technologist in the list. WeFollow.com helps you use your time efficiently by making your people search easy and fast.

4. Twitscoop http://www.twitscoop.com/

Twitscoop is the service which lets you search the real-time trend in the twitter. Twitscoop uses the dynamic tag cloud to show the most talked topic in an interactive way. You can also search for related keyword and finds its popularity in the Twitter network.

Overall, it allows users to “Mine the thought stream” provided by Twitter. Twitscoop’s algorithm cuts every English non-spam tweets into pieces (“tags”), and ranks them by how frequently they are used versus normal usage. Twitscoop can essentially be described as your real-time web’s monitor.

5. Twittercal http://twittercal.com/

Managing your calendar is very tedious. You may have to enter new task on the go and may not have access to web version of Google calendar. Now you can do that easily via Twitter, you just have to send a small tweet and it gets added to your Google Calendar.

It’s a free service that connects your Twitter account to your Google Calendar. Add events in a snap from your favorite Twitter client. Follow the 5 steps procedure to get started.

6. Socialtoo http://www.socialtoo.com/

Socialtoo is a paid service that lets you manage your twitter account by autofollow and unfollow tool. It also provides you basic statistics about your followers count and tweet count. It helps you manage your account and reduce the spam in your network.

It has interesting features like social survey that allows you to create survey that will allow you to understand your network much better.

7. StrawPoll http://strawpollnow.com/

Can you measure the sentiment of your network? Ets say you have 1000 people in your network, getting everyone’s opinion one to one is difficult. If you just want to measure if your network is Pro Apple or Pro Google, what do you do? Well Strawpoll is the tool you are looking for.

StrawPoll is the coolest way to follow the opinions of people onTwitter. It allows you to create poll and communicate with your network and understand their opinion.

8. TweetDeck http://www.tweetdeck.com/

Tweetdeck is the most popular desktop application for Twitter developer in Adobeair. It is very popular for its interface. It provides you a very easy way to maintain your daily twitter activities. Tweetdeck provides easy way to group your friends into different tabs and clean up the twitter stream. You can also search in the Tweetdeck and open a dedicated tab for the keyword; this allows you to track them easily. Recently, TweetDeck also has added TweetDeck Directory which is similar to WeFollow.

9. Stocktwits http://stocktwits.com/

StockTwits is an open, community-powered idea and information service for investments. Users can eavesdrop on traders and investors, or contribute to the conversation and build their reputation as savvy market wizards. The service takes financial related data and structures it by stock, user, reputation, etc.

User can add a set of specific stocks, save them to their own portfolio and limit the conversation around it or focus only on their favorite and trusted sources. Watch the whole stream or create your own filters. User can follow the best on the site, the best only in your areas of interest and in turn share your best actionable ideas. This is the best Twitter related financial site on the web does this in real-time.

10. TwitterSearch http://search.twitter.com/

TwitterSearch is the basic framework of the entire search engine that is present. It provides an easiest way to find out tweets related to keywords. It also has an advanced feature that lets you customize your query to find relevant tweets. It is small but powerful tool.  Once you get hang of it, it can be your most powerful tool of all. Beside search, it was shows the trending topic which can be useful to get hold of the perspective of twitter.

To Actually understand how to use twitter to promote your business here is a link to an awesome article by Chris Brogan.

P.S : All the rankings and stats are based on my personal opinions and experiences while using them.

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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Having both studied a Master of Science in Entrepreneurship and working in my 3rd startup (trying to apply the lean techniques that Lessons Learned made me aware of), I can say that my ideal is that entrepreneurship is a science. In reality, it’s a collection of Sciences as well as the act of Imagination AND Guts AND Agility, none of which are particularly scientific.

It’s a collection of sciences because no entrepreneur or team of entrepreneurs is undertaking just one activity, he, she, or they are doing many in parallel, some of which are business related and some of which are technological. Both have scientific foundations behind them.

Why the Business of Entrepreneurship is scientific is simple to explain. Businesses, starting or existing, can’t operate in a vacuum (for long). We have to obey financial restrictions, sell the idea to our investors, who themselves employ scientific means to measure whether the return on their investment justified, communicate to the market in effective ways, study the market, and project manage all the activities and people in the company. For most of these “wheels” already exist, so there isn’t always a need to reinvent them.

BUT, there is no replacement or science for guts, imagination, and agility in starting a business. You have to ignore many rules, you have to play dirty, and you have to be quick & flexible if you want to succeed. Maybe a management scientist can eventually plug those dirty variables in a formula somewhere. But I doubt it can be applied to any two startups successfully.

Vincent

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

Related posts:

1. E’ship diary part 3: Why I don’t like the term ‘entrepreneurship’
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Yes, we have all been busy doing things like moving to different countries and continents, starting companies, starting and changing jobs. I think Cecil is even well on his way to becoming a e2.0 authority, and judging by Fidji Simo’s tweets, I think she’s developing herself into an expert in retail—on-, off-, and hybrid forms. And that is amazing news and exactly what I always wanted from Tech IT Easy—a “workforce” that is productive outside of Tech IT Easy and contributes to its members’ lives on- and offline as well.

Which is why I still encourage anyone interested in technology and its commercialisation to join us, to develop and contribute their thoughts and expertise!

All that aside, what more can I wish for our readers and bloggers on this Christmas day? For one, I wish for a better 2010 and I am 100% certain that it will be. We all got a little roughed up in 2009, but what doesn’t kill us only makes us stronger! The Internet Boom & Bust… pah, I laugh at its impact: it lead to Le infamous nouveau Web, aka Web 2.0, aka the one where 37Signals had to remind us of the revolutionary idea of charging $$$ for products. I also laugh at Enron, as all its promised consequences of accountability haven’t affected the upper-tier of management one bit (and maybe never will).

But I don’t laugh at what is happening today, I’m happy about it. Between the magnificent state’ification of banks, the “new/old” lean approach to doing all business, and the threat of global warming, it’s another warning shot at us, the complacent human race who thought they had it all under control again. The world isn’t perfect and I hope that every one of those bumps bring us closer to making it better.

All cynicism aside, we live in a time where information is at our fingertips, where collaborative filtering and neuroscience help us better filter the relevant stuff to the top, where we can still publish news at a click, which is still an amazing concept, and where we all have GPS in our hands today, and augmented reality in our hands tomorrow. Yay, the innovative mind and yay, it’s practical outcomes!

Merry Christmas everyone and if you don’t hear from us before the 31st of December, have a great transition into the new year!

Love,

Your Tech IT Easy team:
Alex, Jeremy, Steve, Fidji, Georgia, Cecil, Vincent, Kari, Manu, Lucien, Matthias, Raj, Raphael, and Remy

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The opinions expressed within this blog are those of the authors alone. ©2011 Tech IT Easy. All Rights Reserved.

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