The world's richest man says everyone needs feedback beyond one-word descriptors.
Bill Gates, who recently reclaimed the title of the richest man in the world, took to the stage earlier this month for a TED talk on one of his pet causes: improving the quality of education. Specifically, the Microsoft creator focused on the need of quality feedback for teachers.
"We all need people who will give us feedback. That's how we improve," Gates told the audience. He continued:
"When Melinda and I learned how little useful feedback most teachers get, we were blown away. Until recently, over 98 percent of teachers just got one word of feedback: satisfactory. If all my bridge coach ever told me was that I was 'satisfactory,' I would have no hope of ever getting better. How would I know who was the best? How would I know what I was doing differently?"
Gates feels thorough peer evaluations, as well as evaluations of teachers by students, might help teachers improve in their career. As an example, Gates used the high-achieving province of Shanghai, China, noting their key to success has been "the way they help teachers keep improving."
"They made sure that younger teachers get a chance to watch master teachers at work. They have weekly study groups, where teachers get together and talk about what's working. They even require each teacher to observe and give feedback to their colleagues."
In other words, real dialogue engendered real feedback.
Like teachers, employees need feedback from their boss. Rather than rely on impersonal one-word evalutations, identify specific aspects of the job workers need to improve on.
How have you helped your employees improve?
A group of community-minded start-ups hope to ease the burden of college tuition with the concept of crowdfunding.
Striking out on your own is hard, but it's even harder with college loan debt.
It's no surprise, then, that a number of start-ups have popped up recently with the mission of tackling America's student loan crisis.
According to Federal Reserve Bank of New York, this debt has almost doubled since 2007 and is nearing $1 trillion. In fact, it's already surpassed the mark of auto loan debt, which is somewhere in the neighborhood of $783 billion, and credit card debt, which stands at $679 billion.
With almost 40 percent of student loan borrowers owing up to $10,000 and 30 percent more owing up to $25,000, these start-ups have their work cut out for them.
Here are six hoping to lessen the burden:
Campus Slice This "social funding platform helps you slice your tuition bill by getting support from your family and friends," says its website. By setting up an education and funding goal, and then inviting family and friends to help reach them, students can effectively crowdfund their education. Supporters are asked to make small monthly contributions, thereby keeping costs down while providing the student with a steady flow of income.
GiveCollege On this crowdfunding site, parents must register their child's 529 college savings plan on GiveCollege's platform, taking care to mention fundraising opportunities--birthdays, holidays, graduations, etc.--and invite friends and family to contribute.
By selecting the type of college parents want their child to attend, GiveCollege can predict the cost of the tuition. "We do this based on the college type you chose, your child's age, the average cost of that college currently, and then the average increase in the cost over the past few years," says Angela Merrill, co-founder.
GradSave This start-up aims to crowdfund college tuition, allowing young people to receive monetary birthday and holiday gifts that directly go toward college savings plans, CEO Marcos Cordero told Inc.
"Friends and family can contribute directly to their savings in lieu of other temporary gifts," so graduates can "focus more on accomplishing dreams of entrepreneurship rather than on paying back loans."
Pave With Pave, prospective students can set up an "innovative social-financial agreement." What does that mean exactly? Students accept a one-time payment from backers in exchange for "a small, affordable percentage of income over a period of 10 years," sort of like selling stock in themselves. The success of the prospect is in their best interest, so backers might opt to provide career guidance, mentorship, and network connections.
Tuition.io This start-up is "saving students and graduates time and money, while working with the lenders to streamline the entire process so that everybody wins," says founder Brendon McQueen. Like Mint.com but with a focus on loan debt, Tuition.io helps users manage their student loan portfolio by providing helpful reminders, personalized advice, and tools such as customized payment plans.
Upstart Similar to Pave, this start-up lets grads barter funds for "a small share of their future incomes," per its website. "The idea of Upstart is, can you provide a window of economic freedom as well as some guidance and mentorship for people that want to take a non-traditional path?" says founder Dave Girouard.
The innovative production company received top honors for its brand-driven content this week.
It's no secret the advertising production company B-Reel is changing the industry. The company made waves last year with the viral sensation The Wilderness Downtown, and this year it released The Beauty Inside, an interactive branded film that invites viewers to play the lead role.
On Friday, B-Reel announced it had swept the prestigious CLIO awards, winning not one, but two Gold distinctions in the Film and Branded Entertainment categories. Other recent award wins include six One Show awards, two Golds for SXSW, five Art Directors Club awards, and four Webby awards.
"The Beauty Inside is a truly integrated project, where the boundaries between traditional storytelling and user interaction is totally blurred,” Pelle Nilsson, executive producer and founding partner, said in a statement. “And it shows that a great collaboration between agency and production company is what makes for outstanding execution."
B-Reel, which has its roots in Scandinavia, has traditionally shied away from straightforward ad work, even as it lacked the technology.
"Limitations are frustrating, but they can also trigger a really creative side in you," Petter Westlund, the company's chief creative officer, said of the company's hacker mentality. To date, the company has created dazzling ad campaigns for Mitsubishi, State Farm, Doritos, and Google.
The Beauty Inside is not the first B-Reel production to receive accolades this year. Both that film and another short for Google Maps Cube received numerous nominations and won four Silver Pencils and one Bronze Pencil from The One Club, which promotes excellence in advertising and design.
B-Reel currently runs six offices worldwide and five divisions, including commercials, content, digital, feature films, and products.
Dr. Dre and Jimmy Iovine gave USC $70 million to fund a degree for creative entrepreneurs. The program's success may depend on these things.
The program, featured in The New York Times, sounds like an entrepreneur's dream come true. Beyond attending an academy conceived by the mind behind the hip hop hit, "Let Me Ride," students will dive into the business world by way of music, marketing, patents, and prototypes. The four-year program culminates in a senior thesis project, in which students team up and spend a year designing a prototype.
Iovine and Dre told The Times' Jenna Wortham they never expected to start a university program. But at a time when Internet giants like Yahoo are acquiring young start-ups in order to stay relevant, the degree offers the hope of discovering the next Steve Jobs. That's a good look for USC and a strong selling point for cash-flush VCs, who might scour the campus in search of young talent.
The only question is: Will it work?
The true test of the program's success depends on three factors, says Chris Vance, a Kellogg School of Management graduate and CEO of the start-up Playground Sessions.
Vance says, "It's going to come down to the strength of the curriculum, the teachers, and admissions committee's ability to accept--and nurture--students with that entrepreneurial spirit, which is a difficult thing to teach and define."
Given USC's track record for turning out top-notch talent--both Don Bayne (Trader Joe's) and Henry Caraso (Dollar Rent-A-Car) graduated from the Marshall School of Business in the late 1960s and early 1970s--this endevour should have no problem churning out winners.
Although, Vance is wary of any entreprenurial program that is too narrowly focused on business. "It has to have a strong liberal arts foundation," Vance stresses. "Philosophy and even foreign language should be taught on top of the more focused coursework." He agrees that the marketing curriculum will be important because "you've got to know how to sell your product," and that working in groups helps to "develop leadership qualities and listening skills." The latter is what makes an entrepreneur sensitive and aware of the fact that "the best idea is the product of many," he says.
Despite some early pitfalls, the social network has successfully made the transition from start-up to publicly traded company.
It's the eve of Facebook's one-year IPO anniversary, and what a strange year it's been.
The Menlo, California-based company has successfully ginned up revenue to the tune of $1.46 billion in its first reported quarter, up 36 percent from $1.06 billion a year ago, according to The Wall Street Journal.
But while the company has made good on its decision to ramp up advertising, the jury's still out on whether users appreciate it.
According to The Journal, the days of relying on desktop ads in the right-hand column of its website, which the company did before filing for its IPO, are all but over.
Facebook's begun running ads for the first time on mobile devices and in its News Feed, and created "special widgets" for ads that promote installments of third-party applications. The company also launched a now-fledgling e-commerce store, which some say has dilluted the user experience.
To be fair, Facebook admitted a year ago that it was "not originally created to be a company," but was "built to accomplish a social mission--to make the world more open and connected." The company has succeeded on both counts, of course, but as The Journal points out, the idea that revenue would stem from user engagement hasn't "been enough to push Facebook's stop back up to its IPO price last May of $38.
Although that's not to say Facebook hasn't tried. After changing its tone on revenue last year, the social network made efforts to connect with advertising clients, going so far as to organize boot camps for employees and trips to meet with bigwigs like Procter & Gamble.
To date, Facebook has not delivered on all its shareholders' expectations, but some companies told The Journal the revenue-friendly attitude has encouraged them to spend more money on the site. Online retailer JackThreads.com, for example, says he's taken advantage of Facebook Exchange, a real-time marketplace that sells ads based on what sites users are visiting.
The missing link between intelligence and performance is grit, says Angela Lee Duckworth.
Angela Lee Duckworth, a former consultant at McKinsey, knows all about pushing past limits.
At the age of 27, Duckworth left her high-flying post in management consulting to teach math in New York City's public schools. As a teacher she realized some of her strongest performers didn't have "stratospheric IQ scores," but would fare better on their tests than their smarter peers.
What was the missing link between their limited abilities and their performance? Duckworth knew immediately it had to be grit. All the students could learn the material if they worked long and hard enough at it. Innate intelligence wasn't a factor--what mattered was doing the work.
"Grit is passion and perseverance for very long-term goals," Duckworth said in a recent TED talk. "Grit is having stamina. Grit is sticking with your future, day in, day out, not just for the week, not just for the month, but for years, and working really hard to make that future a reality. Grit is living life like it's a marathon, not a sprint."
Perhaps the most remarkable thing about grit, she continued, was how little scientists understand it. So far, the best idea she's heard is growth mindset, the belief that the ability to learn is not fixed and can change with your effort.
"We need to take our best ideas, our strongest intuition, and we need to test them," Duckworth said. "We need to measure whether we've been successful, and we have to be willing to fail, to be wrong, to start over again with lessons learned."
How have you applied grit at your business?
Harvard Business School grad Angela Newman left a high-paying consulting career to launch her own line of high-tech women's undergarments. Below, she shares five tips that any start-up CEO can learn from.
When Angela Newman was getting an MBA at Harvard in 1994, creating a line of undergarments couldn't have been further from her mind. "Never in a million years," she laughs now. But after graduating with her MBA in 1996, she landed a consulting position at McKinsey where she became an expert in textiles. It was something that was already in her blood. She grew up North Carolina, the heart of the U.S. textiles industry, and for many years watched her father hard at work as an executive at Milliken, a high-tech textile company that was big on R&D.
In 2009, Newman started developing what would eventually become Knock out!, a line of specialized undergarments made from odor- and moisture-absorbing fabric. In April, Newman beat out some 130 global entries to become the first woman-owned business to win Harvard Business School's Alumni New Venture Contest. Below, Newman shares some of the lessons she's learned from spending 11 years in the textiles industry and five years at the helm of her own company.
1. Play the Field
Every founder has "positions" they love to play, but this is a hazard in a start-up! With my passion to make undergarments, I spent nearly all of my early time on R&D and production. I eventually had to force myself--sometimes over strong objections--to get involved in EVERY area--including IT, legal, distribution and customer service. My goal was to gain an understanding, not necessarily do everything. Knowing enough about each area to ask the right questions and establish the right measures should be a part of every CEO's tool kit. Plus, it keeps life interesting!
2. Stay close to the customer
With all the breadth of work and pace of change that occurs in start-ups, it is easy to lose contact with the most important aspect for success of any business--the customer. We don't have a big market research budget, but I get valuable information by going direct to our wholesale and retail customers on everything from marketing messaging to prototype testing. These unfiltered customer opinions help us avoid mistakes and actually enhance the overall relationship between our company and our customers--which is invaluable in our over-marketed world.
3. Enter business competitions
Start-ups are often operating on a tight budget and everyone is going 200 miles per hour, so the idea of adding some non-critical item to the TO DO list is not popular. But the benefits business competitions offer cannot be overlooked--feedback on the concept, new contacts, and publicity to name just a few. I entered Knock out in three business plan competitions within our first two years--investing over a full month of my time toward these contests. Was it worth it? Absolutely! Knock out won the Harvard competition and was chosen one of the Top 15 Global Startups by Kauffman Foundation. The payoff was enormous. Experienced feedback, money, many contacts with venture investors and faculty, and lots of publicity.
4. Don't forget to live
No person can keep up the start-up pace indefinitely. It is easy to become engrossed in the business and forget friends, family, fitness, and hobbies. Every founder must learn to step back and enjoy life--not only will it improve health and happiness, but it will provide the much underappreciated time to take a step back and reflect on the business. I never miss my gals trips.
5. Be willing to let go
Every entrepreneur will tell you the "new venture" is more like a new baby. Full of energy, endless needs, joyous and frustrating all at the same time and all consuming in the early days. But just as babies grow up and become more independent, so should the startup. Building infrastructure, hiring great people and making yourself "expendable" should be the goal of every startup that wants to grow up.
Four simple, destructive behaviors that doom a marriage--and a business.
Kim Kardashian and I have one thing in common. Neither of us would know the other if we tripped over them.
Before a few days ago, I was aware that she's famous, that she's had reality shows and a sex tape, that she had a 72-day marriage to the NBA's Kris Humphries, and that she has more Twitter followers (17.8 million million as of last count) than all but three U.S. states have people.
But then, the other night, a friend posted a link on Facebook to Scientific American: "How to Have a Longer Marriage Than Kim Kardashian."
I clicked. I read. I learned. I learned about Kim Kardashian--but I also learned some great tips for running a business.
The article was based on a study of married couples that lasted 14 years (about 71 times the length of the Kardashian-Humphries marriage). As I read, I realized that psychologists John Gottman and Robert Levenson's advice about saving a marriage also adds up to great practical advice for leading stakeholders in your business.
Gottman and Levenson didn't actually study the Kardashian-Humphries marriage, but they wanted to identify early signs that couples would split. So, they asked 80 Midwestern married couples to describe a recent argument. They recorded how the couples interacted with each other--and then they tracked them for 14 years.
Here's the amazing part, according to writer Melanie Tannenbaum:
Gottman and Levenson eventually realized something incredibly important: They didn't actually need to note down all that much. In fact, there were just four behaviors that could be used to predict which couples would still be married 14 years later -- with 93 percent accuracy.
Gottman and Levenson refer to the troublesome quartet of behaviors -- contempt, criticism, defensiveness, and stonewalling -- as the Four Horsemen of the Apocalypse. (This is where the Kardashian part comes in, because Tannenbaum cleverly illustrated each behavior using clips of Kardashian and Humphries arguing on TV.)
Avoiding these four behaviors might be good for a marriage, but they're also an excellent guide for any business leader who wants to improve communication. So here's an examination of the four, along with what you can do to avoid them in your business.
1. Avoid contempt by building a culture of appreciation.
Contempt "is a potent mix of anger and disgust," Tannenbaum writes. The Kardashian clip she chose to illustrate contempt shows Humphries telling his soon-to-be-bride that her career is "essentially worthless" during a heated debate over what state they should live in.
To avoid contempt, Gottman and Levenson advise leading by example, with constant, proactive, respect. This might mean giving credit for accomplishments, but also offering admiration for their work in things that you don't do as well. (Think of the marketing person who shows sincere interest and respect in how the product developers learned their craft.) It also means demonstrating that you, as a leader, expect the same kind of respect in return.
2. Make criticism about actions, not people.
Gottman and Levenson draw a distinction between personal criticism and legitimate complaints. Tannenbaum illustrates this with a video clip in which Kardashian tells Humphries that his messy tooth-brushing habits are "gross" and that people like him are "one of [her] pet peeves."
The old adage, "praise in public, criticize in private" has fallen out of favor, so it's even more essential now that you promote a culture in which expressions of contempt are verboten. People need to think about whether they're legitimately criticizing their colleagues' performance, or launching more ad hominem attacks.
3. Avoid defensiveness; be responsible.
The best offense may be a good defense, but defensiveness only gives offense. Tannenbaum illustrates this with a clip in which Kardashian blames Humphries when she loses of a $75,000 pair of earrings in the ocean--refusing to accept her possible responsibility for say, wearing $75,000 earrings in the ocean.
Gottman and Levenson advise avoiding defensiveness by actively accepting responsibility when things go wrong.
"This doesn't mean shouldering all the blame," Tannenbaum writes, but simply acknowledging your acts and omissions that may have contributed to someone else's less-than-stellar performance. Doing so might help you quickly navigate the personal minefields in a difficult situation and approach the real problems.
4. Don't tolerate stonewalling.
They say the opposite of love isn't hate, it's apathy. To illustrate this Tannenbaum chose a clip in which Kardashian told Humphries she did not plan to take his last name.
"This clearly bothers him," she wrote, but "rather than talking this out and coming to some sort of compromise or reasoned conclusion, Kris completely shuts her out."
Stonewalling can be a behavioral response to stress, she continues, "accompanied by increased physiological responses like an accelerated heart rate, higher blood pressure, and sweating." If you feel yourself reacting in this way, or if you observe it in your employees, Gottman and Levenson's advice is to "engage in something called 'physiological self-soothing,' which basically just means taking deep breaths and trying to mindfully relax."
In other words, take a deep breath, count to 10, and remind yourself that your business (or your relationship) is well worth the price of this momentary stress. As H.G. Wells said, "The crisis of today is the joke of tomorrow."
The fast-growing data visualization software company puts Seattle back on the IPO map.
Tableau Software, the Seattle-based data visualization software company, joins the sparsely-populated ranks of tech start-ups that have gone public so far this year, pricing its stock at $31 per share for Friday's IPO.
Under these pricing terms, Tableau will have a market capitalization of $1.7 billion, Forbes reported. The company is offering up 5 million shares Friday, while stockholders are offering up 3.2 million, GigaOm reported. Shares will trade under the symbol "DATA" on the New York Stock Exchange, and co-founder and CEO Christian Chabot rang the opening bell this morning.
Tableau's first-quarter revenue in 2013 reached $40 million, up more than 60 percent from $24.7 million in the same period last year, Forbes reported. Even if pricing stays flat all day Friday, GigaOm's Derrick Harris wrote, the company stands to rake in $155 million from its 5 million shares.
The company has landed on the ranks of the Inc. 5000 for five consecutive years starting in 2008. That year, the company had $13.2 million in sales revenue which increased 373 percent to $62.4 million in 2011.
Tableau is the first Seattle-based tech company to go public since Zillow's public offering in July 2011, GeekWire reported.
Yes, crowdfunding is cool. It's democratic. It's disruptive. And it's a bad idea for a lot of start-ups.
There are two completely different ways of looking at crowdfunding. It is either a) the best thing to happen to start-ups since Red Bull; or b) while sometimes useful, it’s no serious substitute for other sources of money, including family & friends. Even bootstrapping.
This may not endear me to some of my friends, but increasingly, I lean towards the latter.
Yes, I know, I know. Crowdfunding is revolutionary. It lets you raise funds without sacrificing ownership or having to face relatives across the table at holidays, or needing to promise a return besides a free sample of your product or some other “reward.” At least until the SEC weighs in with rules on how you can crowd-source equity investors, you don’t need to do much of anything to apply for that money except create a decent color scheme and tell a nice story. Even so, crowdfunding has drawbacks. Here are three:
1. It makes it too easy to kid yourself
Ever written a business plan? If you have, you know how much painstaking thought you have to put into crafting mission statements, identifying supply chains, forecasting sales and determining costs, etc. It’s like going to college--you put in the effort to show what you’re capable of. Granted, not every professional investor will demand a business plan, as such, but all of them will demand to get under the hood of your business proposal. Until you’ve validated every decision you made in creating your company and developing your product, you’re not getting anywhere with them.
With crowdfunding, it’s a bit different.
Even if you have a real business in mind--as opposed to, say, a campaign to cover your expenses while you study art in Florence--you know one thing: No one on Kickstarter, Indiegogo or their imitators is going to ask you to estimate your cost of customer acquisition or the size of your potential revenue streams or any other tough business questions.
Yes, running the numbers is hard, let alone using those numbers to win over skeptical investors. But there’s a reason for that. Business is hard. Convincing real investors that you’ve got what it takes is your company’s first reality check. Crowdfunding can let you postpone reality, but not indefinitely. It’s better to ask the hard questions before you’ve burned through a year of your life and $100k of other people’s money.
2. It isolates you from people who can actually help you
Raising money from professional investors forces you to be think hard about your company and be honest with yourself. But it also gives you the benefit of having real, seasoned experts thinking hard about your company, too.
A seasoned angel or VC can help you decide, say, whether to incorporate, how to cope with a cash crunch (which you will have, trust me), and where to turn for advice about a thorny business development question. Crowdfunding may connect you with seed money, but ultimately your company stands a higher chance of success with the benefit of the tactical savvy, strategies for market capture, and smart financial practices that a seasoned investor can provide. Also, a well-connected veteran with a serious stake in your success can open doors that a pack of starry-eyed strangers chipping in $50 apiece simply cannot.
3. I'd never recommend investing in a crowdfunded company. What does that tell you?
I recently reviewed a crowdfunding proposal from a company that makes nutritious snacks using a global supply chain in West Africa. The company is looking for $50,000 on indiegogo.com to fund production. The campaign offers 11 contribution categories, with perks ranging from a personal thank you on their website to a weekend in Napa complete with wine tastings, hikes, and quality food.
After researching this company's team, it became apparent to me that no one had any financial experience. In fact, only one team member had any qualifications listed on the crowdfunding site at all. If you are serious about starting and building a company that lasts, why would you want to surround yourself with company like this?
Realizing your dream as an entrepreneur is hard. Crowdfunding sites, in my opinion, distort the dream. Granted, funding can help supplement other sources of money and help you try out a product, but the true test of a business is what happens after the funding is done. And that’s when you’ll need the discipline, expertise and sense of urgency that comes putting your own money at risk or that of serious investors who expect a real return.
One YC partner makes an exit, while Paul Graham introduces five new ones--including Groupon founder and ex-CEO, Andrew Mason.
Y Combinator founder Paul Graham took to his blog yesterday to announce the hire of four new part-time partners--including Groupon founder and ex-CEO Andrew Mason.
The other part-time partners, who will advise the next class of YC start-ups, include Michael Seibel, the founder of Socialcam, Steve Huffman, the co-founder of Hipmunk and Reddit, and Dalton Caldwell, the co-founder of Imeem and App.net.
Kevin Hale, the co-founder of Wufoo, will join YC as a full-time partner.
"We've known all these guys for years and we can already tell it will be great to work with them," Graham wrote. Harj Taggar, the first-ever YC partner will be leaving the firm.
But the big news here is the surprise return of Andrew Mason, the Groupon founder who was, for all intents and purposes, canned from his last gig as Groupon's CEO. He's not just becoming a part-time partner at YC, either. In a blog post on his own site--timed with Paul Graham's post--Mason had a few announcements of his own.
"If there's a silver lining to leaving Groupon, it's the opportunity to start something new," Mason wrote. "I've accumulated a backlog of ideas over the last several years, my favorite of which I'll be turning into a new company this fall."
He doesn't offer many details about the new company, but Mason also used the post to announce a third new project that's currently in the works--a music album targeted at young people entering the workforce.
In his words:
I came to realize that there was a real need to present business wisdom in a format that is more accessible to the younger generation. It was with this in mind that I spent a week in LA earlier this month recording Hardly Workin', a seven song album of motivational business music targeted at people newly entering the workforce. These songs will help young people understand some of the ideas that I've found to be a key part of becoming a productive and effective employee.
We'll be sure to stay tuned.
Yahoo is eyeing the blogging platform Tumblr, but Facebook might beat it to the buzzer.
It's beginning to look like Facebook might spoil Yahoo's acquisition party.
The search giant has been eyeing Tumblr for awhile, according to All Things D, and CEO Marissa Mayer has been on an acquisition spree--ten companies to be exact--ever since she took the reigns nine months ago.
According to sources close to the corporate development team, Yahoo believes Tumblr could bring them the key 18 to 24-year-old demographic it needs to seem relevant and youthful.
However, David Karp, one of the blogging platform's founders and chief executive, has been seen around Silicon Valley nuzzling up to another tech bigwig who goes by the name of Mark Zuckerberg.
Karp was first spotted at the Facebook Home launch, reports Giga Om. Facebook also has a reputation for snapping up startups, with Instagram being its largest (and most successful) to date.
A Facebook spokesperson declined to comment, but Giga Om seems to think both companies are eyeing Tumblr due to its mobile ad push. Mayer has said she's focused on mobile, and Tumblr owns nearly 108 million blogs and 50 billion posts, with 117 million visitors a month, according to comScore. Karp's company is rumored to be valued at $800 million.
"For Yahoo this could be a much needed foray into mobile advertising and also into pushing new native ad-formats that help diversify its ad business away from the usual web advertising," says Giga Om.
Serial entrepreneur and mentor Jeff Hoffman writes about his experience aboard the floating accelerator Unreasonable at Sea.
I'm amazed to see an explosion of global interest in entrepreneurship in the last few years. Nations on every continent are turning to entrepreneurs to address unemployment, create jobs, stimulate economies, and innovate new ideas.
A great example of this flurry of activity is Unreasonable at Sea. Created by the Unreasonable Institute in Boulder, Colorado, Unreasonable at Sea is an inventive and impressive undertaking in which 11 start-ups travel on a ship to 13 countries to try and launch their ventures in multiple global markets in a condensed period of time. During the days in between ports of call, the entrepreneurs continue working on their start-ups with the help of seasoned mentors (like me) on board.
I wrote this dispatch last month somewhere off the coast of Gambia, between stops in Accra, Ghana, and Casablanca, Morocco. The entrepreneurs and their products on the floating incubator gave me hope for a better world. One team developed a solar powered hearing aid that is allowing thousands of deaf people in underdeveloped nations to hear for the first time. Another team made a low-cost, non-invasive surgical device that is making surgery available to rural villages where surgery was never available before. A third group created a low-cost stove that will allow families in emerging nations to prepare their own food in places where they could never cook their own meals before. And there's eight more.
It's encouraging to see a generation of young people who want to make the world a better place, and are launching companies to achieve that goal. But the uniqueness of the Unreasonable at Sea voyage makes this an incubator like no other. As they build their start-ups, the entrepreneurs visit potential markets and immerse themselves in on-the-ground activities with the real potential buyers of their products. They hold focus groups in India, visit villages in Ghana, test products in Myanmar, and meet with distributors in Vietnam. It's not only a life-changing experience, it's a turbo-charged entry into global markets that few entrepreneurs will ever be exposed to.
This kind of outside-the-box thinking, from the creators of Unreasonable at Sea, mixed with incredible entrepreneurs and mentors on the ship, come together to push the boundaries of entrepreneurship and social responsibility to exciting new levels. I can already tell it will benefit millions of people on every continent long after this journey is over.
These eight tips will make your business travel easier and cheaper.
On Sunday May 19th, I will finish the tail end of an epic journey that started March 12th and included, Ho Chi Minh City, Phan Thiet, and Phu Quoc in Vietnam, Dubai in the UAE, Bath, Brighton and London in Great Britain, not to mention, San Francisco, Silicon Valley, Berkeley, Philadelphia, Atlanta, Atlantic City and Washington, D.C. During this entire time, I stopped home in New York City for only nine days.
I had weather ranging from 100 degrees and 90 percent humidity to 35 degrees with wind and rain. I needed to dress casual, business casual, in a suit and tie, and I needed workout clothes as well. I traveled in planes, trains, and automobiles as well as tubes, subways, buses, cabs, trolleys, and often by foot for three or four miles to get to my destination.
It was a blast! I learned a few things have changed in travel recently, so here are eight of my latest and most useful tips for the occasional traveler as well as the seasoned veteran.1. Set Up Your Phone and Credit Cards Before You Leave
Roaming is still expensive, but most smartphones work on wireless in foreign lands. Call your carrier and check your options. Sometimes, you can buy a phone with time for cheap which is well worth it for the connectivity. Let your credit card companies know you are going to distant lands or you may find yourself cutoff at the worst time. You'll need your card available for the best exchange rates.2. Invest in Decent Luggage
There is nothing worse then broken luggage on a long trip. For a few hundred dollars, you can get indestructible, easily packable roller bags that are well worth the investment. I have used only two bags in the last 20 years thanks to Briggs and Riley. For carryon, I switched to a backpack. This Tumi T-Tech is my new favorite. It's big enough to carry all I need but it's light, compact and with leather trim looks nice for any meeting. I keep my luggage packed with all my toiletries and travel items ready to go at all times. And don't forget to pack a swimsuit because you never know when you'll need it.3. Wear TSA Friendly Clothes
TSA is the worst part of travel these days. The new scanners require no items on your person. I wear slip on shoes and drawstring pants to avoid the belt issue. Put all your pocket items in a light jacket or sport coat while in line so you can just put the whole coat in the bin. It's still a hassle but you might be able to skip the whole thing with TSA Pre™.4. Check Your Bags
Yes really! Thanks to new electronic tracking systems, today there is less than a 0.3 percent chance of luggage being lost. Plus, little time is saved by keeping it with you. In most airports, by the time you actually disembark, go to the bathroom, train to the main terminal and get to baggage claim, your luggage is nearly there. Meanwhile, by checking, TSA is faster, you can pack any size shampoo, avoid scrambling for overhead space, and you get an easy, lightweight walk through the terminal. You can avoid fees with frequent flyer status or an airline credit card. Then enjoy plenty of room to relax on the plane. For a little more legroom, after take off, take your carryon from under the seat and tuck it behind your legs. It acts like a footrest and allows you to stretch your legs.5. Bring a Book (an actual book) and a Pillow.
E-readers are fine, but any flight will leave you with over 90 minutes of non-electronic time. This is my favorite reading opportunity. I always keep a new novel to entertain me and I never have to charge it. My other must-have is this new Samsonite adjustable pillow. I shaped it for many uses on planes, trains and for use in hotels. It beats any inflatable by far.6. Get a Small Laptop
As a writer and video guy, I find tablets (even with keyboards) grossly inadequate for serious editing work. And sadly, my MacBook Pro 13" was proving too big to open on some domestic coach flights. I love my new MacBook Air 11". I tested it successfully in the tightest of spaces, and I love how light it is. If you prefer PC, get a small netbook. The cloud helps you use a small laptop for travel even if you need the big screen at home, and you'll be thrilled with the portability for walking and full features out and about. Don't forget a power adapter for all those weird plugs.7. Use Cabs as a Last Resort
Taxi cabs are hands down the most expensive form of transportation in most cities. They're convenient for short distances if traffic is not terrible, but public transportation is best. Do some research and use the subway, metro or underground. You'll save a ton of dough and get to see the flavor of the city by people watching. Or better yet, if you can time your meetings appropriately and if weather permits, take long walks and really experience the foreign lands you're visiting.8. Consider Airbnb
I've stayed in my share of hotels, which were mostly fine. But Airbnb is now my lodging approach of first choice, especially in foreign lands. I used it twice on this adventure for three nights in Dubai and six nights in London. In each case, I had my own room with all the amenities of any hotel, and my hosts were delightfully friendly, and better at inside knowledge than any concierge I've known. I stayed in beautiful homes at a total cost savings for the nine nights of more than $2,000 overall compared with hotels in the same vicinity.
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Forget shiny objects and distractions. How people who grew up with nothing, people like you and me, build big-time success.
There's way too much focus on amorphous concepts like leadership and entrepreneurship these days. If you spend enough time around successful executives and entrepreneurs, you quickly learn that none of them ever set out to become either. That's just not how it works.
The more I think about it, if I came into the workforce now instead of 30 years ago, I'm not sure I would have made it. Frankly, the odds are much slimmer now. There's just too much distraction, too many shiny objects, too much information keeping people from focusing on what really matters.
Make no mistake: It's still possible to make it big. It just takes some focus, and the ability to tune out the noise and the pomp. This is how real people who grew up with nothing end up making it big in the real world.
By making their own luck. They say luck is when preparation meets opportunity. That's absolutely true. Take baseball. When you get a high fastball right where you want it, it doesn't do any good if you can't hit it out of the park. You've got to be ready when that break comes.
By trusting their gut. I don't get crowdsourcing; it makes no sense to me. When everyone collaborates and has to agree on everything, you don't get innovation and you don't get great work. Sometimes you just need a focus group of one.
By making smart decisions. There's a good reason why smart people do well in this world. They can reason. They don't throw caution to the wind based on one data point from a source that isn't credible. There's simply no way around it. Good things come to people who make good calls.
By taking risks. The single biggest reason why the vast majority of people go nowhere in life is because they don't or won't take risks. They take the easy way out, the path of least resistance. You don't make it big that way. Ever.
By finding big problems that need to be solved. There's a huge misconception that innovation is mostly about inventing or coming up with cool new things. More often than not, innovation is about figuring out what people really need or want but can't have or afford.
By saying "sure, no problem" a lot. If you're always telling people why you can't do something, if you parse everything and nitpick, I've got news for you: You're not going anywhere. If you want to make it in this world, learn to say, "sure, no problem." Practice. It's good for you.
By working their tails off when they need to. Sure, there are people who became rich and successful the easy way. There must be. But I've never met or known one. Not one out of thousands. So forget it. If you're not ready to work your tail off whenever you need to, settle in for a life of mediocrity. And one more thing. First you do the work. Lots and lots of work. Then success happens. In that order.
By focusing on what really matters. You know all the personal branding, blogging, tweeting, liking, messaging, posting, status updating, and social networking everyone spends all their time doing these days. None of that matters. Period.
By negotiating hard. And getting equity. Whether it's your own company or a piece of somebody else's, if you want to make it big, you've got to get a piece of the pie. The catch is that nobody wants to give it up, at least not easily. So you've got to negotiate hard. Do it. It'll pay off big-time.
By finding ways to resolve their issues and complement their weaknesses. I keep hearing about strengths-based leadership. What a crock. If you've got big issues or weaknesses that are holding you back, you need to face reality and find a way to either resolve them or partner with others who can put up with you and fill in the gaps.
By listening and learning from smart, accomplished people. This is the argument for getting out in the real world and working for a stellar company or two while you're young. You'll learn how things work in the business world. You'll learn how to manage. You'll learn the ropes from people who've actually accomplished what you aim to do.
By doing. Nobody ever got anywhere by sitting on their butts and saying, "Someday I'll do that ... maybe tomorrow." Successful people are people of action. They do things. They get things done.
Now go out and make it big.
Are your employees afraid to disagree with you? Here's how to help them stand up for their opinions.
As the CEO of my online marketing company VerticalResponse, I'm actively involved in the day-to-day and right now I've got 12 direct reports. They span from coordinators to SVP level so I'm dealing with a varied bag of experience and know-how. My team understands that as involved as I am, each one of them is empowered to chart the course for their projects, make decisions and get stuff done to meet our individual and collective company goals.
I was in a meeting with my director of content marketing the other day and she asked me a pretty interesting question... " How do you like to receive push back?" She was asking because not everyone feels comfortable and confident pushing back on the boss (me in this case). It got me thinking about this; as the boss you have to take the fear and risk out of the equation for your employees concerning taking a stance. Allow them to:
1. Just Do It
Imagine that your employee already feels intimidated and scared. Let them know that you hired them because of their expertise, experience and knowledge about what they do. As the CEO or boss, you don't know everything about everything--that's why you need them and want them to share what they know, even if it conflicts with something you think or say. Of course, the feedback should be communicated in a respectful and business appropriate manner--something like, "I disagree here because I have some data from a recent customer survey that our customers prefer X, not Y," is preferable to "You don't have a clue. I know what our customers want."
2. Stop Agreeing
Have you ever been in a meeting where there was that person that shook their head and agreed with everything that was being said, but then walked out of the meeting and slammed everything and disagreed? Passive-aggressive agreement serves no one especially when it comes to business. Allow for an environment where people feel like they are being heard and can say what's on their mind.
3. Have a POV
Your employees are smart otherwise you wouldn't keep them around, so allow them to have an opinion and bring it. Having differing points of views and opinions is the stuff that great products and companies are made of. Being part of the big idea or a collaborative process means everyone speaks up, shares and takes risks. Provide that safe environment where employees can speak up, be heard and be valued for it.
You may be at the top of the org chart, but you admittedly don't have all the answers. You need and depend on your team for information, solutions and getting stuff done, so make sure they feel included in the decision making process all along the way. For instance, if I'm in a meeting and someone asks me what I think we should do, I often turn the tables (in a good way) and ask them what they recommend.
Using the example above, if I ask what someone thinks and then ignore their response, you can imagine how they'd feel. So no matter what, you must actively listen to what people have to say, consider it and take it in, no matter how strongly you feel about it. Otherwise, you'll be a hypocrite and no one wants that.
So how do you handle it if you just don't agree and need to make a decision that your employee doesn't share? Being honest and transparent is your best bet. Let your employee know that you've heard what they had to say, that you really value their opinion, but for [insert the reason] this decision needs to be made. Most employees get that as the boss you have to make tough choices sometimes, and as long as they are considered and valued in the process, they'll buy in and support it.
How do you prefer or handle getting push back? Got any advice to add?
The captain of the world's most ubiquitous social media platform talks leadership, disruption, and why he follows Mia Farrow.
There are certain things you’d expect of the CEO of the fastest growing, most disruptive, 140-character communications platform in the world. For starters, you’d expect him to spend a lot of time thinking about the future, much of which his company is driving. You’d expect him to be scrambling to keep up with explosive growth. You’d expect him to be pithy: anyone viewing the world through 140-characters updates ought to be pretty good at concise expression. And you’d expect him to be surprised by nothing.
Well, three out of four isn’t bad.
Dick Costolo’s path to CEO of Twitter has actually been full of surprising twists, and the company he runs has been a continual source of amazement--to him as well as everyone else. Costolo came to Twitter in 2009 as COO and took over as CEO, supposedly temporarily, when co-founder Evan Williams went on paternity leave. (Moral: Don't go on paternity leave.) He was interviewed this week by Jason Mendelson of the Foundry Group at the annual meeting of the National Venture Capital Association, the venture capitalists’ trade group. The following is an edited version of his remarks.
On his not exactly straight career path
Costolo was a classic engineering geek at the University of Michigan. To fill out his degree requirements in his senior year, he began taking acting classes--and wound up stage-struck. On graduation, he spurned tech job offers to head for Chicago and the famous improv comedy troupe, Second City, where he worked alongside, among others, a young Steve Carrell.
Acting is a hard profession. After Second City, I was getting auditions for things, but I didn’t get any parts. I guess in retrospect that was all part of my career strategy.
What launched me toward Feedburner? Well, the Internet happened. When I saw Mosaic, I thought, “I gotta do this.”
I founded and sold a few companies. Feedburner was my fourth. [It sold to Google in 2007 for a rumored $100 million-ed.] Carrell and I were recently reviewing where everyone in Second City with us had ended up. Steve turned to me and said, “Too bad things didn’t work out for you.”
But I do think the theater background has helped. One of the things that I think I do well as a CEO is that I’m present. When I’m with my employees, I’m there in the moment. That’s something you learn in improv, where what’s here right now is all that matters.
On starting up outside Silicon Valley
Taking the helm of Twitter meant moving to Silicon Valley, which Costolo views as a mixed blessing.
It's absolutely possible to do start ups outside of the Valley. I loved Chicago for the same reason Warren Buffett likes Omaha. When you’re outside the Beltway, as it were, you are spared a lot of distractions. You’re not always being told “This or that is a great deal. Everybody who knows anything is getting into it.” I remember one can’t-miss deal in particular. The company raised a lot of money and went out of business six months later. There’s a benefit to not having to deal with that stuff.
Another thing: The competition for developer talent is really tough in the Valley, It’s remarkable how much attention you have to devote to making sure you have the most appealing work environment. It’s distracting always to have to worry that if my company doesn’t have the best burritos all my developers are going to leave.
In the midwest there’s not so much competition. You should think about the work environment somewhat, but you can focus less frequently on the quality of the burritos.
On management and leading
Twitter had 50 employees when Costolo joined. It now has 2,000. Not surprisingly, Costolo spends a lot of his time recruiting, hiring and trying to maintain a coherent company culture.
I try to spend a lot of time with people outside my direct reports. The view from the top is totally distorted. If you only spend time with your directs, you have no perspective on what's really going on.
For example: One time an employee came to me and asked whether employees should be having one-on-ones with managers or not. His manager where he used to work in the company had one-on-ones every week; the manager in his current assignment didn’t believe in them.
That’s when I realized we had no consistent management style at Twitter. People just carried over what they had learned the last place they worked. They’d just think, “This is how we did it at Google, or at eBay.”
So I created a management course, and I teach it myself because I want my managers to realize how important it is to me that they manage correctly.
One thing I try to impress on all managers is that they make sure everyone on their team understands what they understand. When that happens, office politics kind of drift away. You don’t have people saying, “What are those guys doing over there in that group? They goof off and don’t work the same hours we do." You don’t have people saying that kind of divisive thing.
I also try to set an example by telling the staff when I screw up. That is super-important because it empowers everyone to say to me or to their manager, “I screwed up. What should I do?” I want everyone on my team doing that and not covering up mistakes and not getting help they need.
A lot of young managers think they have to be omniscient. They think, “I’m the manager, I’m supposed to know that.” I tell them, “It’s not your job to be omniscient. It’s not your job to make all the decisions. It's your job to make sure the right decisions get made.”
Remember, as a manager, you’re totally transparent. If you’re making decisions about things you know nothing about, your team will see that and they will realize you’re going to make their life miserable. You need your team’s trust and you build that trust by being honest.
On Twitter’s role in change--and culture
One of the things that amazes me about Twitter is the way it utterly eradicates artificial barriers to communication. Things like status, geopolitics and so on keep people from talking to one another. Those go away in Twitter.
You see exchanges that would never happen anywhere else. You’ll see a woman in Canada direct a question to Paul Kagami, prime minister of Rwanda and get an answer. I remember seeing a rapper bragging that making the first million is the hardest. Within seconds T. Boone Pickens tweeted back that the first billion is a lot harder.
But my favorite Tweet started with Sara Sliverman. She was saying that if being around your family annoys you--this must have been during the holidays--just pretend you're in a Woody Allen movie. Mia Farrow tweeted back. "I tried that, and it didn't work." I followed Mia Farrow immediately.
Another reason to spend an evening with Humphrey Bogart or Peter O'Toole -- you just may become a better leader as a result.
Lawrence of Arabia (1962): Make them believe in the win-win
The film opens with T.E. Lawrence (Peter O’Toole) in a basement drawing maps for the British Army. It’s not a glamorous position, but Lawrence manages to show his superior officers he has a keen understanding of the Middle East. Reluctantly, they send him into the desert to conduct intelligence work, and he eventually camps with a Bedouin tribe that is desperate to protect its land from the Turks.
Lawrence begins as the ultimate outsider, but in a short period of time he becomes a primary leader. How did he do this?
He understands the needs and nuances of the Bedouin and politically engages their leader, Prince Faisal (Alec Guinness). More important, he understands that to be trusted he has to present himself not as an internal expert, but as servant-leader acting on the Arabs’ behalf. Lawrence’s success is grounded in his ability to persuade the Bedouin that siding with the British is a win for both parties.
There is a footnote here in that in the short-term, Lawrence is able to accomplish his goals. Those who know British history know that this was not ultimately a win-win, although Lawrence was clever enough to cast it that way. Even though he shows a servant attitude, he understands that he has to get the Bedouins on his side.
The Caine Mutiny (1954): Keep them in your corner
But when Nicholson inspects the enlisted men’s efforts at building a bridge he is horrified at their spotty work, improper organization, and bad planning. He assumes command of the project and begins to design a better bridge.
When asked why he is helping the enemy, Nicholson firmly states that he is doing nothing of the sort. He argues that he is boosting morale, disciplining the prisoners, and upholding the British Army’s reputation by doing the best job possible.
The completed bridge is eventually attacked by allied forces and strangely Nicholson fights to protect the bridge--his bridge. In the ensuing battle he finally realizes the error of his behavior and asks himself, “What have I done?” A shell blast knocks him to the ground and he slowly gets up. But the pain is too much for him. He stumbles and falls on the detonator, demolishing the bridge he worked so hard to create.
Nicholson knew how to lead a team, but he forgot the overriding, larger goal of the war. He only realized his error when it was far too late. Leadership can sometimes be an intoxicating, distracting force that blurs common sense and straight thinking. The Bridge Over the River Kwai reminds all leaders that they must never forget their bigger mission.
The Bridge Over the River Kwai (1957): Don’t forget your mission
Lieutenant Commander Phillip Queeg (Humphrey Bogart) is put in charge of the Caine--a run-of-the-mill U.S. naval ship. The first day on the job, Queeg makes it known that he runs a tight ship that follows all naval regulations. He doesn’t like shirttails hanging out and he doesn’t like protocol overlooked. The men on the ship are in a constant state of lamentation. Certainly, their old captain, who endeared himself to the men, wasn’t as tough and certainly not as demanding.
In a fierce storm, Queeg orders the ship to follow its intended route instead of turning around to avoid dangerous weather. The crew mutinies. When they make it to shore, the Navy investigates the mutiny and holds a trial. Queeg is found incompetent because of his neurotic attention to detail, but we have to ask--was he really? Queeg was an accomplished navy man with a stellar record. Perhaps his subordinates were just lazy and lacked the courage to follow their leader into the storm. The Caine Mutiny asks tough questions about leadership and what leaders can and cannot do. Queeg ultimately failed not because he didn’t have the necessary expertise and knowledge, but because he didn’t bother trying to win over his crew pragmatically.
The Guns of Navarone (1961): Make sure they work together
Granted, this isn’t your average leadership challenge. But to many, the group dynamics will be familiar. Each man in the team has a specific skill set that’s important to the mission, but each has a problem trusting the other.
The film examines the interactions between the men as they set out. Mallory keeps the team together, but does it without heroics or a lectern. As the mission nearly unravels, it becomes clear to each team member on how dependent they are on each other. Mallory takes a group of individual experts and methodically creates a team capable of working together.
Twelve Angry Men (1957): Give them time to work out their differences
Juror No. 8 (Henry Fonda) is the only jury member who believes that a Puerto Rican teenager living in New York City may not have killed his father.
The other 11 jurors are irritated with Juror No. 8. Not only do they feel the case is cut-and-dried, but they have social plans and don’t want to deliberate late into the evening.
However, Juror No. 8 insists on reviewing the dubious facts, and argues that he can’t watch a teenager hang on such weak evidence.
Again, his fellow jurors mutter disapproval and restate their desire to go home. Juror No. 8 demands another vote--this time a secret one. The ballots are counted and to everyone’s surprise another “not guilty”’ vote crops up. Juror No. 8 sees a light at end of the tunnel.
Twelve Angry Men puts team dynamics under a microscope and examines how groupthink, personal motives, and prejudices can inhibit a team’s performance. However, Juror No. 8 exhibits how true, fact-by-fact, pragmatic discussion can convince people to think in different ways. Moreover, Juror No. 8 takes things slowly and gives times for differences to be ironed out. He doesn’t streamroll everyone with his views, but rather talks them to his side.
Going global isn't only for big players. How a far-flung workforce can benefit small businesses.
When you think of multinational corporations, certain names probably pop into your head. But, there is a completely different kind of global company: the micro-multinational. Daniel Barnett founded and runs one of these companies, WorkEtc, an all-in-one business management platform.
WorkEtc's company headquarters sit in Australia, with development teams in China and Romania, a chief technical officer in Malaysia, local support in the UK, U.S. and New Zealand and a dedicated sales team in the U.S. "We operate in a 24/7 global marketplace," Barnett said, "and as a start-up the only way of staying open all hours and keeping lean is with remote teams."
Managing people on multiple continents has some difficulties, but it can be done. The first thing you have to do when hiring people who may never set foot on company property is hire way above the skill level you think you need, according to Barnett. "There is the temptation when hiring people in cheaper overseas market to hire at the same skill level or experience that you would locally. You immediately think, awesome, I can get this same quality person for half the going rate downtown! It never works out like that. You inevitably lose some productivity to time zone differences and often non-native English speakers require additional instruction. But hire above the level you were looking for and you can easily recover this and then some."
Hiring can be difficult as well. WorkEtc often recruits people who have been end users of the software, which caters to business owners, so most of the employees know what it's like to run their own business and work independently. Even so, no one is hired straight out. Barnett gives a three month trial period to see if the person really can handle being part of a global team while working completely independently. Barnett says the three months really aren't necessary: He can tell if it will work out within the first two weeks.
And what are the keys to success? It's not technical skill, as everyone who begins the three month trial has that. It's the ability to become part of the team--not an easy task when you never meet your team members. WorkEtc uses a "Daily Report" to make sure everyone is on the same page and as a tool to get to know each other. At the end of each employee's workday, everyone--including Barnett--must fill out the daily report. This isn't some sort of complicated, technical report. It's just four items:
- What I worked on today
- What are the challenges I have
- How I overcame those challenges
- What I'm working on tomorrow
While the main focus of the answers are business related, employees are encouraged to mention other areas of their lives as well. This helps build relationships among team members who may never meet. And while this report seems simple, several people in the trial periods have been unable or unwilling to write up daily document; they don't stay on after the trial period.
When a trial period is unsuccessful it can be painful on all sides, Barnett says: "One person, a year ago, was late to Skype meetings, and missed one or two daily reports. I had to give them the hard news. The person was not entirely shocked, they knew they hadn't met expectations.
These kind of things become very, very important in a remote environment. I mean it's not like you can just lean over the cubicle wall and pull someone into a meeting if they're late or have forgotten."
Another thing that you need to think about with a multinational workforce is that everyone needs good communication skills--including telephone skills. Often people who are brilliant at complex technical work are uncomfortable getting on a live call and talking. Email and IM are great tools, but actually talking with your team can solve problems in half the time. So, it's a skill Barnett screens for.
What are the advantages of having a micro-multinational over a regular small business? Well, for one, the employees love their independence and telecommuting. One employee in Los Angeles was able to give up a daily 60 minute commute each way. Another employee in the UK has a disability that makes regular trips to an office difficult. A third, who is Australian, was able to keep his job even after he relocated to Malaysia to be near his wife's family. Definitely a benefit for the employees.
Not everyone is suited to this type of job, but for those who are, the micro-multinational can be a successful small business model.
Wharton management professor Matthew Bidwell talks with Inc. editor-at-large Leigh Buchanan about the nuances of measuring employee productivity.
A recent newsletter from the University of Pennsylvania's Wharton School addressed the lack of clarity over what constitutes productivity in an office. Among other commentators, management professor Matthew Bidwell weighed in on the problems with using "crude numeric tools" to achieve desirable behavior.
Inc. Editor-at-Large Leigh Buchanan spoke with Bidwell about the trouble with traditional productivity metrics.
Organizations place so much emphasis on people developing their intellectual capital. But there aren't a lot of tangible outputs for that. Does that discourage people's willingness to spend time on it?
Learning, developing intellectual capital, these things are very hard to measure. So are other desirable behaviors, such as helping people. And of course the more you measure those things that can be measured, the more attention people pay to that, and not to the things that are more difficult. Setting clear goals for people motivates and engages them. If you use metrics for those goals then the other things tend to get ignored.
So helping colleagues and other what you call "citizenship behaviors"--recruiting, mentoring etc.--are sacrificed to productivity metrics?
It's about tradeoffs. People see the costs of citizenship behaviors much more clearly because they see them as coming at the expense of exceeding their targets or whatever is being measured. So you have to ask yourself, as the manager, what is more important? In a lot of organizations you may feel helping is nice but not so critical to our success. In those cases, yes, I'm prepared to sacrifice some of those citizenship behaviors. In other environments you might make a very different judgment.
How do you encourage citizenship behaviors?
You can let it be known that [employees] will be rewarded. A lot of organizations have 360-degree reviews where they try and incorporate feedback from peers to get a sense of who is helping others. And there are some cultures where the expectation is if someone needs your help then you will give it. In those cultures people understand that there are sanctions for not helping. So you can never measure it as well as more tangible things. But you can certainly get a sense of it.
What you can't have are wishy-washy metrics of "people say this guy is very helpful," and then the hard dollars they brought in. It becomes very hard for organizations to resist the temptation to pay more attention to the hard dollars.
Do employees generally dislike productivity metrics?
I guess it depends, in part on what you are using them for. We know that people like feedback. Not necessarily performance evaluations--they hate those. But they like to know how they are doing. Productivity metrics help people say, "I had a good day today. Yesterday, I had a less good day."
That's especially true if rewards are tied directly to the metrics. Very high-performing salespeople who get high commissions are very, very focused on their productivity metrics. There's a lovely video we sometimes show in class of Nordstrom's highest-performing salesman. In it, he says it's all about I want to know exactly how much money I'm making each day, so I know what my paycheck is going to look like. In those kinds of jobs, productivity metrics actually help people get excited. In other jobs they might be a distraction.
I guess if the company doesn't have metrics then managers will just use their judgment about how an employee is doing, which can be problematic.
Most managers try to anchor their judgments to something. If they can't measure your outputs, they may measure your inputs, like whether you're staying late at work. We tend not to like those cultures, where what is important is that you are in the office, not what you actually achieve.
As a manager, talking about the quality of someone's work is hard. We can sit here all day and argue about whether or not something is high quality. Measures have objectivity about them. They make it much easier to justify a decision.
Are there some professions where metrics don't work--very creative ones, for example?
We think of academia as being this great haven of creativity. But it's actually quite metric-oriented. People want to know how many papers you have published, how frequently they have been cited, what are the student evaluation scores you have received. Scriptwriters might be evaluated on how much money their movie made or the ratings on their TV shows.
How do you help employees weigh productivity when deciding how to allocate their time? You probably don't want to say," quantity matters more than quality so don't worry whether it's any good."
Nobody is going to say that. People quickly get the message based on who gets the bonus, who gets promoted, who gets fired. It's much less a stated policy and much more what organizations do in practice.
Is there a correlation between individual productivity and leadership?
A lot of behaviors that correlate with productivity are going to be important in a leader as well. You want somebody who has the ability to focus on the task. You want someone with a goal orientation. Still, there are certainly people who are very good at getting things done but not so good at working through other people.