Alignment as a $36M Running Value

The SaaS company WorkBoard announced it closed a Series B round for $23M to total out its fundraising to $36M to date. At this point with their revenues tripling year over year, they have market validation. With more complexity and faster growth, keeping the main thing the main thing is a core business challenge for many of today’s businesses. They are providing extreme value.

Even if you outline the steps and processes for your team, you don’t necessarily have alignment right away. That challenge of alignment is part of the continuous hard work of leadership. Having tools that align work with goals with strategic priorities is a giant help.

Business intelligence, Salesforce.com Dashboards, analytics and SOP’s are helpful tools to creating clarity on what needs to get done for team alignment. I think most managers have the responsibility to create clarity and then get alignment from their team members. It can be a grind. What’s in one person’s head as important may not necessarily be true for others on the team. That can create breakdowns or mediocre outputs.

Also, team members can be working on things that simply don’t matter or have much lower priorities.

Everyone I know that is growing their business has the problem of alignment and clarity. The problem is amplified by the speed of change and volume of information that clouds our thinking.

If you can be in the alignment business, which is largely the work today, it’s big money and opportunity. Knowing what to do, doing it well and doing it consistently with a team is often elusive.

We have plenty of knowledge, tools and connection. We need the leadership to make what we often know are important items work like a machine based on what we value as important.

Are you in the alignment business?

Big is Much Harder Than Small

Just because something is working on a small scale does not mean it will work on a larger scale.

You might be able to buy and sell a few computers or hardware but running a division of Hewlett-Packard or Dell is a different game altogether. The amount of resources to manage to get an output has layers of complexity that require deft juggling and trade-offs.

You can have an assistant providing customer service in your consulting, law practice, or professional services. This can alleviate the ongoing bottlenecks to deliver your work with quality and timeliness.

But if you have to scale up and go 10x in clients, data and information flow, by necessity, you will need more people. Now you are in the game of talent management and having to coordinate everyone to align, work and execute in a concerted and cohesive fashion.

Small works because the inputs and outputs are relatively simple. You can satisfy the requirements of your customers by simply working harder. You have a lot of room to make mistakes. You can be sloppy. It’s small, so tweaking how you deliver, sell, market, and support your customers can be done with quick decisions and actions.

If you are big, you have to move many more pieces. Your team is locked into a workflow. They learned to do their job within an architecture that takes more energy to turn should you change your mind. And you have to get them not only acting the way you envision but thinking with you on what is important and how their work matters.

This is why small can be appealing. You don’t have to run an efficient operation all the time. You simply have to stay ahead of customer expectations.

When you get big, you have to manage the team’s expectations and your errors can be more costly. It’s hard to shift to a new process, system or way of doing things when you have new information that you want to act on.

If you are small currently, you will have a challenge in scaling up. And it’s not trivial. The last thing you want to do is underestimate the costliness. Running a big operation demands more. If you’re not up for the hassle, then consider the luxuries of staying small.

Perhaps use the ambition and bandwidth to build something else small and run it in parallel. See if you can gain the net revenue with less hassle this way.

Have you found challenges in scaling up? Do you like small or big?

Your Business Systems Are the Product

bi-triangle-color
From Rich Dad’s Robert Kiyosaki’s B-I Triangle tools and resources.

If you are an entrepreneur or investor in a business, it is so critical to heed the advice and framework that Robert Kiyosaki shares in his appeal that systems, not products, need your focus.

Simply put, “Money always follows management.”

It’s takes a special person to be an effective entrepreneur. There are trade-offs and myriad problems to solve which get more complex the further you grow your business.

Sometimes, we can overemphasize an area because it might be a comfort zone. If you come from a legal background, you might take too much time on legalities and hedging risk. If you have been a salesperson, then it’s easier to pay attention to getting the next deal than aligning the communications and workflow. If you are a marketer by background, you may be tempted to obsess about the look and feel of artwork that is more than good enough.

I agree with Kiyosaki that having a good enough product with a stellar business system is much more important than the opposite. We have a world filled with amazing products. Every day we are presented with something awe inspiring. Yet, it’s hard to move us to buy.

Take a walk through a Brookstone, and you see innovation and creativity to the hilt. But they are considered novelties compared to what is familiar, reliable and fits within our worldview.

Heck, a boring product that people buy regularly like shoes can become remarkable because the business system behind it creates extreme value in reliability and delivery. Zappos did not get into trying to make better shoes. They made a system for delivering the shoes you like in an elegant way.

So, if you are trying to pursue that next great idea, consider where you put your efforts. Maybe increasing your product’s quality actually has a diminishing return.

What if your leverage and impact comes from improving your business systems, and that has a much higher impact on your revenue?

Some systems you can improve:

  • How you sell.
  • How you position.
  • How you communicate and collaborate internally and externally.
  • The enabling platforms and technologies for keeping your business going.

These are all important. Consider which of these systems require more of your time and energy and focus on them uniquely.

These business systems are the actual product.

How strong are your business systems compared to your product?