About the Series “10 Tech Startup Lessons Learned”
PADT is a company focused on helping companies bring their physical products to market. As “We Make Innovation Work” for our customers, we learn a lot about what does and does not work in technology startup companies. In addition, we were once a startup ourselves and we now participate in Angel investing. All of this has taught us a lot of valuable lessons.
In this series we will share some of those lessons learned and explore the basic concepts and ideas that will help startups overcome the odds and become successful.
This posting is the second installment for our series. The first posting was “If You Build It, They Will Not Come.”
We hope that you find it useful and we look forward to sharing our thoughts on this topic with you.
There is a reason why so many business books and presentations use a picture of a guy on a tightrope. Business is all about balancing. But if you dig deeper, you find that in order to balance you have to do two things that are often in conflict – you must stay very focused on what you are doing while being flexible in how you react to things. Getting the right balance between these two approaches is critical to success in any business, but especially for a technology startup.
To understand why focus and flexibility are so important it is a good idea to remember that doing a startup is a process that involves many steps, often executed at the same time. The execution of each step costs time and money, and a startup has a limited amount of both. Therefore it is critical that you only execute the steps that will lead you to your goals. Doing anything else will lead to a squandering of precious resources and will result in your startup running out of funding or not getting to market in time.
The path seems obvious: come up with a plan, then follow the plan. Easy.
The problem is that no one knows what steps are needed when they start, and even if you have a good idea, everything changes all the time. There are a host of external factors that impact what you are trying to achieve. Things like the economy, competition, changes in laws, shifting consumer trends, and new technologies. You can plan for some of this, but not all of it. When circumstances change, successful startups react in a controlled but effective manner. This requires focus, flexibility, and the effective setting of goals.
Focusing on Focus
Being focused is not the same thing as making a plan and sticking to it. Focus is all about making sure you are paying attention to what is important, thinking about why it is important, and prioritizing your actions. It is about having an inner dialog with yourself and within your organization that directs your actions, allowing you to keep moving towards your goals as things change.
Sometimes it is easier to understand the importance of a concept by looking at its opposite. The opposite of focus, in this context, is distraction. In the world of startups distractions are often deadly. They sap resources and move your team away from what they should be doing. They can also lead to making the wrong decisions because you loose site of priorities.
By concentrating on your companies goals and relating decisions back to those goals, you can stay focused and avoid distractions. To do so we recommend the following steps:
- Any time you need to make a decision on if you should do an activity stop and assess it.
- Look at the activity in relation to your startup’s goals and decide if it moves you towards those goals and use that decision to label the activity as something to focus on, or as a distraction.
- Track the distractions for review in the future, they may become aligned with your goals as other things change.
- If it is worth focusing on, prioritize the effort required to complete the activity with respect to meeting your goals. Not just what the impact is, but the impact relative to the effort required.
- Continue to monitor actives with respect to your goals and their progress. Make sure that you lower the priority on activities that are not moving you towards your goals or that no longer address shifting goals.
In the end, you just need to have the discipline to keep your whole team focused on what needs to be done, why it needs to be done, and how you are going to do it.
Stretching for Flexibility
Way back around 500 BCE, a Greek guy name Heraclitus said “Nothing endures but change.” It was true then, it is true now. When creating a startup there is only one thing that is a sure thing – that things will change. The unexpected will happen and things you predicted will not. Worst of all, there is no way to avoid change. You have to accept that it will happen, and when it does happen you have several choices on how to deal with it.
You can resist it, push back, fight the change.. But in doing so you can often loose your focus and create resource sapping resistance. Another option is to ignore it, which is often the easiest response. The problem with ignoring change is that your startup’s goals may actually change and you do not even know it. Lastly, you can meet change proactively, embrace change, and adjust your activities to make the best of it. The issue with this approach is that you may make the wrong adjustments and stop doing what you should be doing.
As with most things, the best answer is a combination of all three of these responses, controlled by each unique circumstance. That is why a startup needs to be flexible. When change happens you need to stretch your perceptions and maybe your knowledge till you truly understand the change and how it effects your startup. Once you understand it in the context of your business, you can devices a plan for dealing with the change, or decide you can ignore it.
The most important part of flexibility is being able to honestly look at your product and your organization and change your views, your activities, and maybe even your organization itself. Being flexible is all about using change to deal with change. It is about being open minded.
Having an open mind and being able to listen to other peoples ideas is a critical step towards being flexible. This is often difficult for those with the drive and passion to create a startup. The self-confidence and determination that keeps them moving forward makes it difficult for them to except that change needs to happen or to let others decide what that change needs to be. Entrepreneurs need to be open to the ideas of others and step up as leaders to modify their plans based on outside input.
For an organization to be flexible, it must constantly stretch and push its flexibility, just like with muscles in the body. If a company is rigid and then tries to make a big change out of the blue, pain will result. A startup that has flexibility as part of its standard way of doing things can bend and twist as needed, when needed, without stretching things beyond limits.
The key to staying flexible and focused at the same time is setting usable goals and effectively using them. Goals are the tool that a startup can use to find that balance between focus and flexibility. They give everyone in the organization a shared set of guidelines to evaluate decisions with. If you have clear goals, your team can look at change, assess its impact on goals, and make intelligent changes.
Easy to say, hard to do. Setting up a concise set of goals and objectives is hard enough, but sticking with them and adapting them as the world around you changes is even more difficult. Whole books have been written on the subject of business goals and objectives. If you have not done so, it is probably a good idea to read one or two or read some articles on the web. Inc. Magazine has a good article from 2010 on the subject.
Some of the rules we use for establishing goals are:
- Goals must be real and achievable
- Chose goals that can be measured
- You should be able to explain why each goal is important to your company in one simple sentence
- Keep goals as simple and practical as possible
- Do not word your goals for outside consumption, they are tool for you and your team.
Whatever method you use, identify real world long-term and short-term goals that everyone in your organization can understand. Once established, make sure you review them and change your goals as you learn more and as things change. Then use your goals as a tool to help make decisions and guide your company through its growth towards success.
Thoughtful Controlled Adaptation
A common term in the world of startups these days is “pivot.” Do a search online for “business pivot” and you will be shocked at how many articles and blog entries are written on the topic. It is an idea that has come out of the observation many of today’s very successful software startups ended up being successful in areas they did not expect or initially go after. Fast Company has a good article on the whole “pivot” thing and where it came from.
Doing a pivot in a business is being flexible and making changes to address changing goals. That is good. However, what we see again and again is people justifying lack of focus or chasing after wild geese as a “pivot.” We know, YouTube started as a video dating site. Great for them. That does not excuse your shift from bio-contaminant detection to making custom dog collars.
If you pivot without control, without looking at what is going on around you, you will fall over. If you pivot away from your goals, then you will miss your target. The answer is to think and adapt to changing situations with control. Assess the change you are looking at, compare it to your goals, and if it make sense, plan the proper effort to implement the needed change. Make a conscious effort to thoughtfully work out your decisions.
The journey to success is a long one, with many distractions along the way. You can complete that journey if you stay focused, be flexible, and set and use goals.