Trust, But Verify

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If you want to grow your business, you have to have good people to delegate functional work to. Otherwise, you become the bottleneck and risk making customers unhappy.

Many years ago, I remember learning the lesson of delegation early while working an engineering project. I had a designer working on new revisions for drawings of a machine assembly I was engineering. We talked about what changes needed to be made. I repeated and reviewed the specific changes with him.

Well, I thought by talking through those modifications that professionals get their job done because that is inherent. I had not learned to trust, but verify.

A few weeks later, after we went to prototype and fabricate of the parts, the assembly did not fit together. I was perplexed. I frantically measured all the components and to my dismay, I found that we produced parts from old drawings. There was a mix-up in what was communicated to the toolmaker.

I thought the designer had handled the updates, but that was an assumption. It was a very expensive retooling because the revisions were not communicated to our manufacturing partner.

We had many other revisions that were managed fine previously. This happened to be one of those that did not get communicated, though the work was done.

My business education benefitted though the project budget ballooned from my mistake. I learned a very hard lesson to trust, but verify. When you have teams or disinterested parties, the risk is high for a bad handoff or miscommunication.

Trust, but verify is risk management. We need it because, despite good intentions, humans are fallible. We are terrible at executing consistently. When there’s a handoff, I like to:

  1. Explain what I need
  2. Have the person let me know they understand by explaining back
  3. Documenting it with an email
  4. Reviewing if we met the spec/requirements of the handoff
  5. Provide praise and gratitude for a job well done

I think that last point of gratitude is important because it makes working together easier the next time based on trust. Also, I like letting people know what they did well. We all need encouragement and honesty as feedback.

You may have heard the phrase, “Trust, but verify.” Usually, people learn this lesson from pain. Hopefully, you can create your own approach that consistently makes handoffs and delegations a core, robust way you grow your business through delegation.

The Lucky Fool and Reality

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“It manifests itself in the shape of the lucky fool, defined as a person who benefited from a disproportionate share of luck but attributes his success to some other, generally very precise, reason.” – Nassim Nicholas Taleb, Fooled by Randomness

If you haven’t read Taleb’s book, he does a masterful job of pointing out how our perceptions fool us, especially from the rare, high impact events we experience. We have biases that are hard to overcome. In the case of the lucky fool, we lean towards taking credit for the good luck that happens to us, and we blame outside forces and people for the bad things that happen. Tragically, our human nature distorts our perception of reality.

The Simple Dollar wrote a great essay on tips for increasing your good luck and decreasing your bad luck. It’s practical advice assuming you can overcome your own bias towards the luck that flows through your life. As the essay states, “We are all the lucky fool.”

There are opportunities galore that are there for the taking for those that are ready for luck. You have to be prepared, optimistic, open and competent to see and act on deals that are timely. Here are some weekly and daily practices to make luck bend your way and protect your downside from bad luck:

  • Treat all people with kindness and respect. Noone has to deal with you otherwise. And you need people to deal with you for luck to happen.
  • Be a person of value. Observe needs and work to help people.
  • Increase your value every day by what you know and who you know.
  • Make a daily habit of doing mindful self-care for your mental, spiritual, physical and emotional self. Pick something in each category and do it every day – read, work out, pray, and enjoy good people, for example.
  • Sow and reap. What you want, give more of. It’s the law of attraction you put to work.
  • Be a funnel of good ideas. You have to be learning, capturing and sharing. Connect your ideas or things you find helpful with the people you care about in specific, helpful ways. You need a good system for this.

I try to practice these habits to keep my probabilities of good flow high and reduce the probability of downside things happening in my life. I want luck, but not be the lucky fool as life and opportunities happen each day.

How do you increase your luck?

Reduce the Handoffs to Increase Efficiency

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Every handoff in your business is a failure point. When one person is handling information and moving execution to the next step, often you can get things done without many mistakes or delays.

When you have to hand off a lead, support call, requirements, or project task, it’s risk. What if the information is not correct? Is there nuance and clarity that have to be transferred?

Many projects need teams to deliver. But often, when we are growing businesses, we simply get fat and waste can build up. There are often unnecessary handoffs where it can be faster with less errors by cutting out steps, people or information.

With this season of downtime, what if you took inventory and got rid of handoffs that no longer make sense?

Look at when a customer starts their engagement with your company. How much work do they have to do before they get contacted? Can you automate the first touches?

Here are some other ideas to drive throughput by eliminating or reducing handoffs:

  1. Where does a request get bottlenecked? Consolidate the work with one person or automate the task using software.
  2. Set the expected response time for team tasks. Track this for 30 days. If you get a 3 day average response for something that should take 1 day, get the responsible parties involved and set up a new incentive to meet the customer expectation.
  3. Map out your steps. See if you can cut out steps that do not add value.
  4. For work that needs to be highly responsive, hire a support vendor or get a virtual assistant. It will force you to define what has to be done and you can manage accountability.
  5. Cut out any middlemen and replace it with direct service or engagement.

Handoffs usually develop because we hope to get some kind of efficiency, but we don’t revisit whether we have failure in speed or unnecessary mistakes. Take it back to simplicity, and care about your customer by removing the waste that simply happens because of unexamined workflow.

As the New Year is commencing, you can tighten your workflow up by looking at all those handoffs which create problems and bottlenecks.

Where are you finding handoff issues?

Eliminate Meaningless Work

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We can laugh at the paper shuffling reference as a bygone era, however, you would not be hard-pressed to see manual processes still being run today. Regardless of the efficiencies, cost-savings and better customer experience of digitization, old habits can die hard, especially in businesses.

Never mind if your livelihood depends on such inefficiencies. Innovating a workflow can easily eliminate the need for headcount.

It’s scary when efficiency keeps rolling back the tide and exposing waste. What may have been necessary or productive once is now either wasteful or meaningless work. This goes for digital processes as well.

There are cheaper, faster coders that can deliver an app from anywhere in the world.

You don’t have to manually enter data from one system to another. Using a tool like Zapier can automatically push data wherever you want. Or just make rules between your apps with IFTTT.

Bench is data mining, commoditizing and automating bookkeeping at scale.

Alibaba gets product entrepreneurs prototyping, testing and domesticating products.

Being a middleman these days can be quite wasteful, especially if you are in a production process. Better to figure out how to be more valuable and use the speed to get better results.

Meaningless work has a rapid half-life, especially when business owners and managers are squeezed to deliver better results and profits. Furthermore, you and I are consumers. We are part of the demand audience. We are snobs. We insist on food being delivered instantly, hotels being seamlessly booked and a car to pick us up when we push a button on our phone. Imagine some paper shuffler processing our requests and bottlenecking the exchange.

In your own work, take a look around and get rid of waste. You may have more time with automation. That’s a good thing. Now you can take the extra bandwidth and put the energy into the main thing that produces results for your customers.

Look across your business. It’s required that you eliminate waste. Consider Toyota’s Taiichi Ohno’s moral stance in growing your business, “It is not an exaggeration that in a low growth period, such waste is a crime against society more than a business loss. Eliminating waste must be a business’ first objective.”

Quick Waste Elimination Tips:

  • Write out the steps you do from attracting a customer all the way to putting money in your bank account. What steps can be removed or modified?
  • Write down all the software and apps you use. Get rid of 20% of them.
  • Find the 10% of best customers you have. Meet with them and do bigger deals.
  • Get rid of paper. Move information into systems.
  • Make it easier for a customer to buy from you or get support. Increase the speed and responsiveness.
  • Design a continuous recruiting process for talent.
  • Define who you like to work with. Only work with those people.

Well Meaning Terrible Advice

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I can see why people often want someone to simply listen rather than give their opinion. The person with the problem knows more than you do about their situation. When you don’t have skin in the game or know the nuances of a predicament, your advice can come off as arrogant and insensitive.

It’s a brutal and hard world, and often we simply need to process or share what’s happening with those we trust to get clear on our convictions.

If we are a friend or trusted advisor, the temptation is to come with answers quickly. Sometimes, it’s well meaning. We want to help.

Other times, it’s irritating. There are often underlying reasons why a decision was made or sins overlooked. And the problem can get enshrouded in friendships, power dynamics, family alliances, owed favors, and many other relational factors hidden to what seems apparent to solving a problem.

It’s hard to unpack those spiderwebs and you can get terrible advice in the process if you share incompletely. “Yes, don’t you think I know that? But how do I keep the relationship?”

These days, I try to practice the following:

  1. If I have problems to share, measure the person. If they can’t help, don’t share. Better to go for a run instead and sort it out emotionally and strategically.
  2. If someone is sharing their problems, listen with care as much as possible. Try to understand what they are not saying.

It saves resentment on both sides when I can stick to these practices. What I find is that most people know how to solve their problems. It may be a hard call they don’t want to make. It may be a relationship they don’t want to compromise. It may be they don’t want to be inconvenienced.

Or, some people even love their problems. It makes them feel important.

I think it’s magical when you can walk with another person, make a difference and really care. But, it takes sensitivity, acumen and love to make good advice work well.

One thing for sure, you can’t go wrong with humility in any situation.

Responsiveness

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I left a message for a company yesterday again. They have still not called me back. I am thinking about moving on. Too bad. There’s a lot of business that could come their way. I tend to be a loyal person to the things I like.

In this instant, 24/7 world, there is this illusion that we can always obtain world-class service. That’s not true. I think we want it. But then we end up with a phone tree, wait times and no follow-through.

Business is still people. And people are hard to move towards responsiveness without leadership.

I still smile when I call my accounting software, FreshBooks, for support. Two rings into the call and I get a live person! It’s impressive. I love their responsiveness, and I tell my clients and friends about them every chance I get. They are part of my team, and I’m a fan.

There are a few other partners that have also set up their business around responsiveness. It keeps me delighted, and I stick with those partners. I trust them.

Maybe it’s my own need for quality. I practice mise en place. I believe in being responsive and love delighting people with a high level of service and care. That’s how I see it. Good business is about truly caring about another person and helping them get what they are looking for fast.

I don’t think that it’s a lot to ask. And I do believe most customers are looking for care and responsiveness. You don’t have to go far to hear the complaints of bad service or sloppy follow-up.

Can you imagine if your brand stood out because of your responsiveness? If you are constantly in a crisis or tripping over your own clutter and disarray, forget it. You won’t make it happen. You don’t care enough.

But, if you want to stand out, I bet opportunities and attraction make their way to your doorstep from a habit and setup of being responsive in all your dealings.

How can you make responsiveness part of your way of doing business?

Maintaining Energy

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Pushing on your work takes an intense amount of energy. And without energy, it’s hard to maintain consistency, perseverance and results. Energy is not a given. You have to foster your routines and habits to keep peak performance going.

I like to hike, play tennis, trail run and snowboard to get me into a bigger world and get the blood flowing. If I miss days, I get crabby and unproductive. The world becomes smaller and my problems become bigger.

Sometimes, when I am thinking about a deal, for example, and how to structure it, I will head out for a long walk. I don’t think about it. I get into freeing up my mind and simply sweating. Somewhere along the line, or when I’m finished, my legs and heart get worn out and that creative kick comes out. This approach tends to work well for me. I may sit down for another four hours and push on creating. I have new energy.

There’s this giant temptation to skip the habits that spend me, relax me or divert my attention. However, those habits are too important to sideline. Managing the ebb and flow of my enthusiasm, energy and focus matter towards getting results and pushing on all the fronts I care about with clarity. That’s why I consider managing energy part of work.

We are not simply brains swiveling on a post. We are whole beings that push our work out from emotion, determination and knowledge. There’s a lot of quality difference in our output from how we feel in the course of a day and how much energy we are bringing to our relationships and problem solving.

I think finding what works to keep the energy high is simply good business.

Dealmaking Is Slow then Fast

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I love dealmaking. I agree with Robert Ringer’s observation about dealmaking:

“There are no statistics to prove it, but after years of experience, I’m absolutely convinced that dealmaking is the highest-paid profession in the world.”

I think the creative pieces and bringing ambiguous, and often disparate parties and value together, is exhilarating. Great deals help everyone to win and get what they want.

Designing those deals requires insight and many cycles to drive a win and agreement. It’s why I often tell business partners that dealmaking is about going slow. Then fast.

The slow part of deal making is the art of the deal. Building rapport and relationships. Establishing trust. Putting the ideas forth that might take root. These are the building blocks that go faster with established relationships and much activity, but in the beginning of new ventures and relationships, they are slow to put forth and germinate. Often times, you have to push hard.

Fortunately, deals are everywhere. They need leadership, vision and management to develop. If you sell a known product, then your dealmaking has a lot of the components already set up.

If you have a custom, creative dealmaking offering, then there is a lot of time collaborating, designing and creating something from nothing.

I think that one of the best strategies is to be ready. Mise en Place. Anticipate that new conversations, opportunities, relationships and timing will come in the next weeks and months. Being ready by doing your homework, studying, gathering insights, having fast, efficient systems, and getting smarter are required to support the slow part.

If you have done the work then the fast part tends to take care of itself. The convergence of the details, negotiating, having solid agreements and delivering value transitions the dealmaking over to keeping your commitments.

You can always get better at the fast part. The slow part is where the payoff is if you pay attention to your approach, preparation and cadence. Where can you improve?

Prototyping Your Idea

There’s a saying that the enemy of the good is perfect. The longer I am in business, the more sensitive and skeptical I get of perfectionism. When I hear fixation on some endless detail that is not necessarily going to prove an idea, the less I want to invest in the venture or the person.

Ultimately, when perfectionism that results in diminishing returns becomes the focal point, the more a deal can go sideways.

When there is ambiguity and uncertainty, the goal is to find proof that your idea is valid. Designing a solid prototype that tells you whether you should refine, scale and go forward with your idea is the best strategy to hedge the risk of failure.

A little planning can go a long way. But, here’s a sequence you can use. Go small and get more information so you can go bigger as you overcome the uncertainty.

  1. What is the concept you are trying to sell? See if you can pitch the idea to ten people and see what the reaction is.
  2. Pre-sell the concept and see if you can make a few people happy with a prototype of the idea in in your product or service.
  3. Develop the use case around your delivered prototype.

The goal is to take marginal risk and get massive insight and information from each step. Then invest more as you see how people like or dislike what you are seeking to deliver.

This is true for customer service, business processes and delivered products.

How can I deliver a prototype?

Designing this first phase and watching closely on the adoption of your idea will tell you the next step. You can gain comfort in investing further or killing your idea altogether.

Troy Carter of Lady Gaga and Atom Factory Kept Learning and Unlearning

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I like spending the weekends thinking, learning and relaxing. The weeks are such a grind and intensive with deal making and doing business. Today, I was having some reflections on the NPR podcast, How I Build This: Lady Gaga & Atom Factory: Troy Carter. I embedded it above and you can find the transcript here.

Troy Carter managed hip-hop and pop superstars as well as built a venture fund. He is remarkably honest, humble and sober. I respect him as a businessman and how he kept integrating what he learned and unlearned. He kept parlaying his skills and exploring avenues to create opportunities from hip-hop to pop music to social media to investing in startups. Even with his heartaches and successes, as many an entrepreneur goes through, he self-actualized, as he shared,

And just to be honest with you, the thing was I just said I want to wake up every day and do cool [expletive]. That was the mantra for me personally.

I can relate. We have to keep true to our inner compass and find fresh, relevant ways that we fit, apply our value and create opportunities in this fast-changing world.

In sharing this podcast, my friend Joseph over at InDev Capital and I were having some takes on Troy Carter’s podcast. I like what he said based on his work with emerging market real estate and the inherent skill and push it takes in his business,

Most everyone goes through “The Dip” and that is where the learnings are.

Well stated, for sure. Entrepreneurs understand this too well. They do pay the price for everyone else. Those learnings become cash flow, empires and job creation.

If you get a chance, listen to the podcast while driving or hanging out. Share some of your insights in the comments below. I would enjoy hearing your take. Enjoy and keep growing.