Went to the gym once. Didn’t work.

You’ve probably heard about things that didn’t work in someone else’s business. The story probably included an assertion that whatever isn’t working for someone else also wouldn’t so won’t work in yours. The tool itself is generally irrelevant. More often than not, the problem is a lack of consistency.

Execution isn’t easy. We do the wrong things. We do the right things at the wrong time. We fail to prioritize, or prioritize poorly – often doing the urgent rather than than the important. Each of those things have their own solution, tactic, or cure. The challenge is executing every day, every hour, every appointment – as appropriate for the solution, tactic, or cure. To be as effective and efficient as possible, all of these things require consistent execution.

We all have a ton of things to do. It takes a systematic intent to consistently eliminate tasks of no / low value, making room for the high value work our peers and customers need most.

Consistency gives

Consistency has a number of benefits. If you are consistently good, people will depend on you / your company – and soon get to the point where their expectations are that you will always do, say, and deliver what they expect. This clientele will tell people. Some of them, the most rabid types, will tell lots of people. A small percentage of them will practically take it as an insult if one of their friends or colleagues don’t use their consistent vendor.

Consistency gives your clients something steady to latch onto at a time when many of them feel there is little they can depend on other than themselves. Outside of your spouse and perhaps a few others, do you have a vendor you can depend on no matter what? One that you would bet your business on? Think about the peace of mind that would give you if you had that kind of vendor (or vendors) in place.

Consistency is a quality you can sell, price higher, and use as leverage when competing for a new customer. Anyone can make a single sale. Consistent vendors make that sale while claiming an asset – a new, long term customer.

Consistency takes

Do you have vendors or places you do business with as a consumer where you always have to remind about delivery or deadlines? Do you frequently have to correct a vendor’s work or invoices / paperwork? Do their work habits force you to be the one who must consistently follow up about promises, on-time delivery, service windows, quality and completeness? Is that the exception or the rule?

How does that make you feel? What’s it feel like the next time you have to purchase or get service from a vendor like that? Do you dread it?

Are you repeatedly changing vendors in an attempt to find one that you can consistently depend on? How does that feel?

Does your business track churn?

Churn happens when a business gets X new customers and loses Y customers each month. If you have to track it, you’ve probably got a churn problem. Maybe it reflects the direction and growth of your MRR (monthly recurring revenue) due to your business model.

Churn happens because customers cannot depend upon multiple vendors in your market. Yes, others are part of this as well, otherwise new customers wouldn’t be filling YOUR bucket that’s also leaking customers every month. Some may be new to the market, but a reasonable percentage of those new customers are coming from other vendors who aren’t taking good care of them. How long will you keep them? Consistency is a factor.

If you ever ask a former customer who churned away from you, they will almost always say they left because of price. Price is an easy excuse to use and it’s one they know you will be least likely to argue about. However, churn is rarely about price. More often than not, it’s the last straw after a customer has lost patience in the consistency of your product / service quality. First they get frustrated, then the investment seems like a waste, and finally, they’ve had enough.

No one gets into business to intentionally be bad at something. It takes effort. Wasted motion. Lost focus. Lack of intent.

Process by process, employee by employee, consistent execution improves quality. Going to the gym once doesn’t produce ideal results. Neither does inconsistent execution.Photo by Dan Harrelson

Do towns benefit from building 2 pizza teams?

What’s the big deal about building an environment that creates the ideal conditions to form a two pizza team? Having startups to talk about at the Chamber lunch is exciting, but this isn’t about improving your cool factor. Improving the finances of your town’s families is important, but there are bigger benefits that affect everyone in town: economic diversification and risk reduction.

What risk?

When 100 families in a town depend on one employer, the current and future health of that town depends on that company, their management, the market they’re in, the market of raw materials they consume (if any), the owners, and so on. One mistake of the wrong kind can put the finances of 100 families at risk – all at once. When 100 (or 1000, or 10000) families in one town depend on one employer, the risk to the finances of that town is higher than the sum of the paychecks involved. All of us can probably cite an example where one of these companies failed, was forced out of business, or was bought out / divested, etc. The reasons don’t matter as we rarely have control over them. Diversifying your local economy is one defensive strategy against such events.

It isn’t that we shouldn’t seek big companies (no matter what “big” means to your town) or grow them locally. We should, but we have to do more than simply seek large employers to the exclusion of all other strategies. Expect that this won’t be what many are used to or expect. Be ready to defend those efforts with progress reports and outcomes, rather than “we know better than you” opinions. You should expect to be questioned about your efforts. The quality of your plans, your transparency, and the frequency and candor of your progress reports will all contribute to getting more people on board.

The economic diversification that comes from the creation of an annual two pizza team will surely be slow, but few lasting things of this nature happen quickly. The political (not necessarily election-related) pressure on economic development teams to bring 100 or 1000 jobs to town at one time is tempting, but in most cases, it isn’t realistic. Enabling and encouraging the entrepreneurs in your town to build new payrolls at a steady pace while other efforts continue is best. You aren’t creating a competition – you’re making your community’s interdependent economy more resilient for everyone.

Job security comes, in part, from economic diversification

Not everyone is going to be interested in taking the leap and creating one of these companies – and there’s nothing wrong with that. However, those who don’t take the leap still need work.

Finding a new job is not a fun experience. It’s sometimes easier not to change jobs and employees. Given the difficulty of hiring and being hired, it sometimes seems like neither employers nor candidates want to go through the hiring / interview process one more time. Despite the mix of sometimes unsightly job / employee seeking situations, there are companies out there who want to find good employees, pay them fairly and keep them. Likewise, there are employees who want to find a solid employer and stay with them for a long time.

The companies that start off as two pizza teams and stick around are likely to be able to do these things. That they’re working toward giving up whatever job security they have *and* creating something new leaves the impression that they want something better. You’d think that they will want something better for their staff as well.

Jobs at these kind of companies often go beyond “just a paycheck”. The motivation for these startups is frequently rooted in the founders’ previous financial / job hardship and/or insecurity, so creating that kind of security for employees is a high priority. The job insecure folks in your community have a job, or two, or maybe three. When those jobs are at risk, and/or seasonal, and/or part-time, the stress and related cognitive load on that family affects everyone.

The obvious benefits of adding new (hopefully stable) payrolls to your town’s families are positive, but the benefits go beyond a particular family’s new source of income. Spreading the creation and stability of family economies across different industries and companies creates a resilience more towns could use. Photo by checkyourhead90 Photo by Jonathan Kos-Read

Your town can fuel the rise of two pizza teams

Last time, I noted that Amazon received no HQ2 (second Amazon global headquarters location) proposals from communities in a number of rural states. At the time, I noted that the decision to pass on that opportunity was a well-considered choice.

More importantly, I asked the following question:

What would the impact be if your community had five new, active payrolls of that size five years from now? “Technology” could be software, wood products, water purification, medical research, etc.

Payrolls “of that size” refers to two pizza teams, ie: a team small enough that you can feed it with two pizzas.

I’d like to talk about what communities can do to encourage the formation of two pizza team. Every community can gain from the benefits these teams produce.

You’re not too rural for pizza

Rural communities can benefit from the kind of jobs HQ2 will bring, without bringing Amazon to town. If your community manages to do what’s necessary to help build only one new 300-400K payroll in town every year or two – the benefits are substantial.

The initial question to address is “What should communities do to create a local culture that encourages the formation of these teams?”

Your town already has an entrepreneurial petri dish, but in most cases, new business creation currently depends on:

1) the bullheaded optimism of entrepreneurs (and sometimes, their access to capital), or

2) Desperate situations demanding that the impacted family do something, anything to create an income.

In both cases, these creations tend to be tied to a short list of highly-motivated (internally or externally) individuals. Some families have always started businesses, so their kids learn to do the same. Others are forced into it. Both groups experience varying levels of success.

We want to create conditions that make your entrepreneurial petri dish a bit warmer and a bit more nutritious, making it easier to grow something in it. A stronger entrepreneurial culture is more likely to hatch a creation that can survive on its own when transplanted into the real world.

While funding is important for some businesses, most two pizza teams start off as knowledge-based businesses that don’t need large capital expenses to get started. Capital needs will likely appear during periods of fast growth.

Fuel for two pizza teams

Two pizza teams need:

  • ideas that serve a hungry market
  • people with the right skills and the spare time to devote to their “side hustle”
  • the confidence to adjust & keep trying when things aren’t going so well

Communities don’t need an inventory of unserved ideas to hand out to wanna-be entrepreneurs. Instead, create conditions that consistently produce ideas. These include Startup Weekends, makerspaces, meetups, & coworking spaces.

Almost any clean, empty warehouse / retail space will do. Dedicated, fancy areas aren’t required. Start with a library or business conference room. Meeting in a clean, safe, empty warehouse or retail space is an inexpensive way to get meeting space while raising awareness of a space looking for its next productive use.

The keys? Create a constructive environment for discussion, formation, & execution of ideas – and get the right mix of people there.

How can community leaders help?

Every community has people with the skills to create a side hustle. What they often lack is experience, confidence, a group to brainstorm with and to ask “Does this make any sense at all?”.

What encourages people to have the confidence to suffer through the rough times? Experience. Mentors. Sounding boards. A community of business owners / side-hustlers who are going through & have gone through that bramble of thorns and roses.

Community leaders can leverage their connections to experienced business owners / managers & local angel groups to get them involved and gain access to meeting space. Like-minded people with the right skills & spare time meet each other at these gatherings. When experienced business owners add their voice, their insight & mentoring builds confidence in those trying to figure it all out.

The confidence part is important. When a small group of people is dedicated to turning an idea into a side hustle & then a payroll, they need the self assurance to weather whatever storms come over the ridge. They need know that it’s OK to pivot (ie: adjust their business and business model to reality) rather than quit.

Every community has a meeting space, experienced business people & folks looking to start a business who need advice & critical mass. Get them together.

Photo by cote

Do rural communities need Amazon HQ2?

After Amazon announced they would be building a second headquarters somewhere in the U.S., they received a predictable flood of urban tax incentives and offers of “Take my community, please” (apologies to Mr. Youngman). 238 of them, in fact, because few companies can say they’ll bring 50,000 jobs to a community and back it up with action. Amazon is one of them.

Why rural didn’t apply

If you look at the map, you’ll notice that no community proposals came from Montana, North Dakota, South Dakota, Vermont, Hawaii, Arkansas, or Wyoming. If you live in one of those states, you might be frustrated by their failure to apply.

I don’t believe it was a failure. It was a well-considered choice. In the past, I have chided some rural communities for not applying for community-transforming projects like Google Fiber. This time, no application was the right call for these areas.

Speculation in the tech press stated that Amazon received no applications from these states for reasons that are “unclear” and that it might be “anti-corporate sentiment“, or because these states were “off-put by the company’s preference for government incentives“. The reasons for the lack of rural applications seem pretty obvious if you live in a rural area.

Some examples, and a few counterpoints to the speculation:

  • Amazon’s stated desire is to build HQ2 in an area with a population of at least a million people. Several of these states have barely a million people total, much less a metro area of that size.
  • An Amazon HQ2 building with 50,000 employees would be the second, third, or fourth largest city in the Dakotas, Montana, and Wyoming.
  • No one in their right (ethical) mind would apply knowing that they can’t come close to filling 50,000 new Amazon jobs with local people. Amazon can build a successful data center here, but a new HQ? Nope.
  • These rural states don’t have the airport routes / seats / facilities that HQ2 will demand. We can build the facilities, but the seats and routes will take time. Upside: The additional routes and seats required to support HQ2 would benefit us as our low traffic numbers balloon our air travel costs to ridiculous levels.
  • These states already provide government incentives to other businesses, though not likely at the scale Amazon might be seeing. We have plenty of sizable corporations – even some multi-nationals.
  • Hawaii makes no sense due to massive amount of air travel required.
  • The ideal Arkansas metro area for Amazon HQ2 is in the northwest corner: arch-rival Wal-Mart’s back yard. No one in NWA is crazy enough to enrage WMT, even though the land availability, cost of living, and the necessary volume of in-context skill positions are available.

Yes, but we’re too rural for Amazon

Yes, you are – and it’s OK.

Even if Amazon lost its mind and came to your rural community – is that what your town really needs? Probably not.

While small, rural communities can’t get, don’t need and can’t handle hosting a facility the size of Amazon’s new headquarters, they’d still benefit from the kind of jobs HQ2 will bring. So what do you do to bring these jobs to rural communities?

The too-obvious choice is often to chase companies that are trying to move or expand from other areas. Rural communities don’t need tens of thousands of these jobs. In fact, they need fewer than they might think.

Suggestion: Think small.

Two pizzas

Jeff Bezos’ famous “two pizza rule” says if it takes more than two pizzas to feed a team, it’s too big. Figuring two or three slices per person, you’re looking at feeding a team of five to eight. Can your community do what’s necessary to help its people create just one new two-pizza-team each year?

You might be thinking “One team per year? Why bother?”

A team might be one administrative position, one founder / manager type, and three to five technical people (whatever “technical people” means). Figure a total annual payroll of somewhere between $300K and $450K. The total might be higher, but it probably shouldn’t be lower – unless you want to lose repeatedly lose people. Startups don’t need that.

What would the impact be if your community had five new, active payrolls of that size five years from now? “Technology” could be software, wood products, water purification, medical research, etc.

Next time, we’ll talk about what communities can do to encourage the formation of these teams.

Are you using comfortable tools?

Almost all work teams use tools. Sometimes these tools change over time, sometimes they don’t. Some tools have a long history and rarely change from their original form – other than perhaps the materials they’re made of. The pocket knife is a good example. While it was once wood, bone or stone, over centuries it evolved to steel and other metals. Today, you can buy a pocket knife in almost any form you want. If you have the right tools, you could make the knife yourself.

Comfortable tools, comfortable shoes

We can get so comfortable with a favorite tool that we don’t consider the use of alternatives. In some cases, we might be blind to alternatives or improvements. Either we don’t realize that everyone who generally does what we do has moved on to new, better, safer, or more productive tools, or we aren’t paying much attention to changes in our industry.

Tools become like comfortable shoes or a car that we’ve owned for a long time. They fit just right. They don’t give us blisters (real or mental). We become so adept at using them to perform our work that they become a part of us. We can use them to perform a task and find ourselves done with the task and realize that we performed the task without really thinking about it. At that point, work becomes much like muscle memory. We can do it inattentively or without focused thought.

While this sort of comfort and familiarity is a good thing, we need to be careful not to let ourselves be lulled into complacency.

Are your tools state of the art, or close?

When we don’t get outside of our comfort zone on tools – and this could be tools of any kind – things can happen to our work and our output that we never saw coming. If you still use a claw hammer for every nail you drive, the houses you build will be as sturdy as those built by someone with a modern tool like the pneumatic nail gun. The problem you might run into is your level of productivity would be the close to what it was 40 years ago. That might seem ok until your ability to complete a structure in a particular time frame is compared to builders who use nail guns.

The nail gun is an example and these issues aren’t limited to any single trade, skill, or career. Even if you love your industry’s equivalent of the claw hammer, it’s worth taking time to review the alternatives that have sprouted in the last year. Some industries experience tool changes quite frequently. In particular, software changes in many industries, but there are many other changes that occur frequently that you may not want to (or need to) switch to. Even so, stay aware of them.

Flavor of the month

Tools in some industries change so frequently that keeping up with them can put a serious dent in productivity. Thrashing around because you’re constantly changing to the “flavor of the month” tool-wise adds hidden burdens to your productivity and costs to the bottom line. This is one of those areas where you see software changes creating problems. This isn’t as much about the software industry as it is about the industry where the tools are used. The software business has plenty of challenges with flavor of the month technologies – but they aren’t alone.

If you feel like you are repeatedly tempted by the “bright, shiny object” tool-wise, stop to reflect a bit on what’s creating the desire to switch to another tool. Is it desire or need? Marketing tools frequently fall into this category, while proven, productive activities such as the manual labor of following up after a sales call are neglected.

Tool changes are often positioned as eliminating the need for a skilled craftsman (regardless of gender), or eliminating the need for a tool user with substantial training and experience. Safety is often a prime component in the introduction of newer tools. None of these things replace training, skill, and experience with a tool. Even with 3-D printing and similar technologies, there’s skill, experience and training at some point in the process.

Build a process with your team that evaluates new tools and gets people to stretch their comfort zone beyond the tools they’re familiar with. This tempers “random” tool changes & allows both experienced & novice staff to offer input & learn the business process for evaluating tools.

Photo by moonrat42

Selling someone else’s products

Have you ever thought about selling someone else’s products? When you sell someone else’s products,  parts of that vendor’s business obviously become a part of yours: their products and services. However, the reality is a good bit more complicated.

Be sure what business you’re in

When you consider selling someone else’s products, it’s critical to assess whether the product is germane to what you do.

For example, it isn’t hard to find stores selling fidget spinners. They’re an impulse buy that could add a small bump to daily sales, so grocery stores, convenience stores and the like could justify selling them back when they were hot.

However, it makes little sense to see these gadgets advertised on outdoor signage at pawn shops and musical instrument stores – which I’ve seen lately. The logic behind advertising out-of-context impulse items on a specialty retail store’s limited outdoor signage escapes me – particularly on high traffic streets.

Will it confuse their market? Will they lose their focus by selling a few $2.99 items? Doubtful. While they’re trying something to increase revenue, the emphasis on an out-of-context, low-priced impulse buy product is the reason I bring it up. It makes no sense for a specialty retailer.

When you start selling someone else’s product, there are questions you don’t want your clients and prospects asking. They include “Have their lost their focus?” and “What business is my vendor really in?”  These questions can make your clientele wonder if another vendor would serve them better.

Should you sell out of market?

I had this “Is it in context?” discussion with some software business owners this week.

One of the owners (not the tool vendor) is asking the group to sell the development tools they use to their customers & other markets. Ordinarily, this would be a head scratcher, since most software development tools generate their own momentum, and/or are marketed and sold with a reasonable amount of expertise. That isn’t the case with this tool vendor.

However, the discussion really isn’t about that tool vendor, even though they’re at the center of the discussion being had by these business owners. The important thing for you is the “Should we sell this product?” analysis.

Start the conversation by bluntly asking yourself if makes sense for your business to sell this product.

Adjacent space or different planet?

If your company sells to businesses that develop software internally or for sale to others, then you might consider selling a vendor’s software development tools to your customers. It might make sense if you sell into enterprise IT.

However, if you sell software to family-owned, local businesses like auto parts stores and bakeries, it makes no sense at all. You’re going to appear to be from another planet going to these customers to sell software development tools.

If you try to sell these tools in an unfamiliar market, then you’re starting fresh in a market your team probably isn’t used to selling and marketing into. The chance of losing focus is significant unless you’re leading your current market by a sizable margin and have plenty of extra resources.

Ideally, a new product line feels congruent to your team, clients and prospects. Even when it’s a good match, the work’s barely started as selling and supporting a ready-to-sell product requires a pile of prep work.

Your sales team needs training to sell the product and know how/when to integrate it into multi-product solutions. You need to include the product in your marketing and training mix. Your support team needs training to provide the level of support that your customers expect. Your infrastructure team needs to incorporate it into your CRM, accounting, website, and service management systems. Your deployment team may need training as well.

What if the new product’s vendor has problems?

Reputation damage is one of the biggest risks when selling someone else’s products, particularly if you have to depend on the other company to service and interact with your customers.

Does the product vendor provide support as good as yours? Do they communicate in a timely & appropriate manner? Do they service things promptly? Are they a good citizen in the developer community? These things are important in the software tools market. In your market, they may not matter.

The actions of the product’s creator reflect on you, since YOU sold the product to YOUR client. Carefully consider the risk/reward. Your entire clientele will be watching.

The ingredients of effective criticism

Today we’re going to use a common political event (and some football) to discuss the effective delivery of criticism.

Recently a new candidate joined a local political race. The new candidate’s campaign has spent plenty of time pointing out things that are broke, need attention, or didn’t go well. That doesn’t mean the candidate has nothing to say, nor that they have nothing valuable to add to the conversation about how their community is run. Even so, this “list” dominates their campaign while offering no specifics about their qualifications for office.

Criticism is not a qualifying skill

We all have the right to bring attention to things that aren’t working or need improvement. Even so, the ability to identify problems doesn’t qualify us to run the organization exhibiting those problems.

For example, my alma mater is (putting it politely) having a rough decade on the football field. It’s easy to note my team’s problems (or at least the symptoms), including their consistent inability to win a game after trailing at the half. When this doesn’t happen for six years, it stands out.

The ability to identify the team’s problems doesn’t qualify me to run a NCAA football program. That’s why I didn’t offer a solution. I might have theories, but management expertise doesn’t make you a coach.

The same kind of expectations exist for that political office. It’s real work. The ability to criticize isn’t enough. The job requires related experience.

If you want a job that requires leading the management of a $25 million budget, people expect that you’d have a fair amount of experience successfully managing a budget of at least low seven figures. Criticizing your opponent’s handling of the budget is fair game. Likewise, so is the public’s desire to hear about your experience and specifics about what you’d do differently and why.

If you want a job that requires leading the management of a team of ~900 employees, you should have experience successfully leading the management of a team of 100 or more. Tell us about your management successes, what you learned from your management struggles, and specifically how you’d make things better. Don’t think we won’t be taking notes and coming back to them to remind you of your suggestions if you win.

Criticism in the workplace has similar demands. If you provide context and propose specific solutions, great. If you’re simply complaining – does that help you, the company, or your target?

Embarrassing people isn’t criticism. It’s ego.

While I frequently discuss inept, unfortunate, or unproductive business behaviors I’ve experienced, I avoid mentioning the business. Why? Embarrassing an employee or business owner serves no purpose. It doesn’t improve the lesson / advice. It doesn’t positively serve the reader, or the business. It’s the kind of criticism that accomplishes nothing.

I prefer to shine a light on things a business can improve how they serve their customers. In turn, this gives the business a better chance of not just surviving – but thriving. It should also build job security for their team, and help the owner’s family benefit from the risk they took wh en opening a business.

To make your team’s feedback loop more valuable, teach them how to deliver effective criticism.

Criticism delivery determines the response

Whether running for office, grumbling about your team, or criticizing how you were treated in a local business, how you deliver that criticism says more about you than it does the recipient. It also plays a substantial part in how your criticism is received and the response you receive.

Criticism is not a bad thing. We all need it. It serves the recipient, not the one delivering it. Much of the criticism people given these days serves only the ego of the person doling it out – and does nothing for the person receiving it.

Ego-driven criticism looks like this: “(business / org / person) is terrible at (whatever). Fire them.

Effective criticism is intended and designed to help those receiving it, rather than drawing attention to the provider.

When delivering criticism, include specifics and where possible, suggestions for improvement. Describe the problem behavior / activity / outcome. Compare it to the desired behavior / activity / outcome. Discuss solutions. Ask how you can help. The outcome is usually what needs to be fixed, not the person.

Think about the best criticism you’ve received. What made it so valuable? Consider that when criticizing the work of others. You’re giving them a gift.

Photo by AutrementDit Toronto.

Why your growing company needs to work slower

You might have seen last week’s discussion of automating administrivia and clerical work simply as a systemization of the E-Myth. That’s fair, but remember that the goal was to reduce cognitive load on focus workers. We didn’t eliminate ALL administrivia and clerical work – and you can’t. Discussions on scaling a growing company rarely cover the burden this work creates. The key to keeping this work from bogging things down? Work slower.

Work slower?

A few years ago, Richard Tripp and I were talking about the challenges of installation and on-boarding in complex enterprise environments. He started the conversation by asserting that “Slow is smooth and smooth is fast.”

As he explained, you have to slow down your processes to improve them.

On a rough road, potholes, dips, and washboards make it difficult to drive safely at high speeds. On a smooth paved road, accelerating to and maintaining cruising speed is easier, safer, and more comfortable. The situation is exactly the same for a growing company’s admin and clerical work.

Note the emphasis on “and maintaining” in the previous paragraph. It isn’t fast to repeatedly accelerate, slow down, then accelerate back to cruising speed. It’s jerky and disruptive. If processes aren’t streamlined and capable of consistent speed and volume, then the work is neither smooth nor fast.

A flat tire on a busy highway

Process disruptions kill you when you’re trying to scale operations.

Fits and starts are demoralizing. One-offs to deal with random failures and issues consume a ton of time and take your team off task. This frustrates your team and delays work output – often backing up other work as a result.

These problems impact your operations like a flat tire affects travel on a busy highway. When a car has a flat, the impact isn’t limited to that car – it slows down the surrounding cars.

In your business, work (traffic) backs up, plus the task that suffered the failure (the car with the flat) is completely halted. Any work dependent on the stopped task is also at a dead stop. A shipment stuck in production can hold up packaging, shipping, the loading dock, invoicing, or other areas.

When you work slower, you create time and space that makes it easier to identify and eliminate the bumps and potholes in your processes. “Slow is smooth” takes shape. It’s about reviewing fundamentals, but also about the deconstruction and review of each part of the process.

Hummingbirds and governors

If you’ve ever watched a hummingbird fly, there’s not much to see. By naked eye, the wings are a blur at best. The bird hovers and appears to veer about as it flies. It seems anything but smooth.

In a slow-motion video, the beauty of a hummingbird’s flight is revealed. Every motion is smooth and consistent – motion that looks much different to the naked eye. Likewise, slowing down your processes and analyzing them step by step allows you to identify inefficient motion, poorly designed screens and paperwork, as well as unnecessary steps.

The elimination of inefficient motion isn’t the reason for a governor, but the idea is similar. A governor is a physical device that changes position as rotational speed of the governed mechanism increases. Eventually, rotational speed reaches a point where the governor moves into a position that cuts the throttle or otherwise limits the speed of movement.

Like speed, scaling reveals flaws

Governors are used to limit machine speed, giving the machine a means of protecting itself.  A mechanism without a governor could gain enough rotational speed to tear itself apart.

Your processes at at risk in the same way. If your business is used to shipping 100 items a day or onboarding 15 new customers a month, things change when you double those numbers – or add a digit. Where 100 shipments a day sustained you, 1000 a day might put you out of business. Under those conditions, an ungoverned not-so-smooth business can tear itself apart.

Smoothly-operated, well-rehearsed processes can accelerate to high speed and high volume without exploding – thus “smooth is fast“. You may need to get faster equipment to handle the volume, but faster equipment won’t fix a broken process. It simply breaks it at high speed.

Improving the efficiency and effectiveness of your work processes allows you to be ready to “remove the governor” at any time, without allowing the business to destroy itself.

Raise productivity by lowering cognitive load

Are you trying to figure out how to help your team become more productive? Traditional efforts to raise productivity will help, but are they enough? At some point, you’ll find that the law of diminishing returns will take over. Rather than give up, you & your team need to reassess the team’s workload and how it’s handled.

It’s important! It’s mandatory.

Traditional attempts at workload assessment usually include a re-prioritization of tasks. Regular priority assessment is a good thing, but not often a great thing. Sometimes it resembles “rearranging deck chairs on the Titanic”. What takes a re-prioritization from good to great is leaving your team open to not assigning a priority to EVERYTHING – i.e.: giving permission to not do a task. It’s OK to identify work as “work we don’t need to do”, or “work we don’t want to do”. However, your team still has to do this work because “It’s important!” and/or “It’s mandatory”.

There’s “mandatory because the law requires it”, but there’s a second form of mandatory that’s rarely talked about: “mandatory because I said so”. Some tasks legitimately fit this criteria, but many shouldn’t. The quote “Mandatory is one of the crutches we use when we can’t lead people.” speaks to these tasks. I’ll bet we’ve all seen this type of mandatory task in the workplace.

Mandatory doesn’t mean a person has to do it

Mandatory workloads tend to be administrative and clerical work placed on non-admin / non-clerical team members. Sometimes, it even includes administrative and/or clerical work placed on admin / clerical folks. Some of this work is necessary and important, like timekeeping for employees whose time is billed out to a customer. The rest should be subject to re-prioritization.

Your team has to stop doing unimportant work so that they can focus on what IS important. I’m sure you’ve heard and thought that before. Even so, we continue to put more “administrivia” work on our people. Sometimes this work is important, but if you look a little harder at it, you’ll find that much of it can be delegated. My favorite team member to delegate this kind of work to is “systems”.

Why do you want to either stop doing this work or delegate it to someone other than an employee? Cognitive load.

Every task you give a person increases their cognitive load. Take a high-value employee who does focused work for you. If in addition to that work, they also have five or more daily administrative / clerical tasks on their plate, those things have to be remembered.

Why does cognitive load matter?

Ever notice how you suddenly remember things at two am, or when on a walk, or while on an airplane? At two am, you’re usually sleeping. On a walk, your mind is free of all the things at your desk. On an airplane, the restrictive environment means your phone is useless and often, so is your computer. Those environments have a lower cognitive load, and suddenly, your brain remembers things again.

Extra tasks competing for brain power create “rush hour traffic” for the brain. Driving a car full of kids in heavy, urban traffic is more mentally draining than driving them on the open road. The complexity of heavy traffic and urban roads make driving more challenging. Add a bunch of kids in the car and.. well, you’re probably all over what cognitive load means. Add darkness, rain, and fog. Each layer increases the cognitive load your brain must manage in order to drive.

New administrative and/or clerical work increase the total cognitive load for employees who do focus work, decreasing the importance of their “real work”. Are these admin tasks more important than the number one task any random team member is expected to complete that week? My guess is that they aren’t.

Lowering cognitive load via systems

Work that requires deep thought is sabotaged by interruptions. We “clump” meetings together in order to reduce interruptions and increase available focus time. We clean our office to reduce clutter – and thus visual “noise” / distractions. Unnecessary tasks, office clutter and interruptions all add to cognitive load.

People under high cognitive load don’t need darkness, fog, or rain (interruptions / clerical work) added to their “drive” (workload). While these tasks can’t always be eliminated, they can often be automated. If someone is making a phone call or checking a website multiple times per day to determine if an action should be taken, is there a way to automate that determination? If you have systems tracking various aspects of your business, is someone manually tabulating that info? Is there a way to automate that tabulation? What can you eliminate or reduce? What can you automate?

Photo of Atlas by Simon Cope

The premium price lesson taught by craft beer

The craft beer explosion in the US over the last 5 to 10 years is a great lesson in premium price / premium product / premium services and customer ascension.

So what is the big lesson to learn from craft beer? Is it that you could make beer that only a certain percentage of the market will drink? Is it that you can put anything from talcum powder to motor oil in your wort as an ingredient and someone out there will want to drink it? Is it that you can charge for one pint what previously would have been a tolerable price for a six-pack?

But I don’t WANT an $80 diaper!

Those answers are all accurate at some level.

However, the biggest lesson is that in any market (including yours), there is a percentage of the market that’s willing to pay a premium price for a premium product. Products and services have had “Good, Better, Best” for years. Despite that, there are still many businesses out there that only offer a single product line with very little variation or options, premium services, or the opportunity to “ascend” to the next tier of product buyer.

These opportunities are not limited to automobiles, cigars, locally brewed beers, or any other thing. You can buy cheap toilet paper and you can buy fancy toilet paper. Speaking of, there are companies making a living selling diapers that cost $80 each.

While I don’t want to buy an $80 diaper, it’s clear that some portion of the diaper buying public does. That’s the trap that you can’t let yourself get caught in. It doesn’t matter that you and I aren’t interested in an $80 diaper. All that matters is that enough people are buying them. The same goes for a bottle of craft beer that might cost $12, $29, or much more. The challenge is finding a product that fits a market.

Premium price changes everything

In whatever you sell, there is almost certainly a premium price product or service opportunity – or both. You’ll never know where the price ceiling sits until you test it. We’ve all been offered an up-sell (want fries with that?), but this is different. Successful efforts typically result in a new tier of products and/or services. Sometimes, it reveals a completely different type of customer. It also allows ascension for some of the customers you have now.

Testing new product / service / price tiers could result in a new way of doing business for a subset of the people you serve. It may also reveal that there are additional price / product / service tiers between your existing regular and premium-priced options.

A successful “bar” that closes at 8:00 pm?

Montana micro-breweries are a fascinating example of finding an undiscovered tier in a market. They operate under a number of restrictions that impede their growth, including (recently raised) limits on the number of barrels they can brew each year.

Two additional restrictions that would ordinarily seem fatal to a traditional drinking establishment have instead created a new market tier.

First, Montana breweries with a taproom / tasting room may only serve 48 ounces (three pints) per patron per day. This might seem like a rather punitive restriction, but it doesn’t work out that way. First, most craft beers have a higher alcohol content than “regular” beer. As a result, three pints per visit is usually enough. Ever seen a bouncer in a brewery’s taproom? I haven’t. You’re more likely to see families and friends meeting together with their kids. Yes, in a taproom.

Second, Montana brewery tasting rooms cannot serve beer after 8:00 pm – at least not without getting a more costly / complex alcoholic beverage license. The traditional thought process would presume the 8:00 pm close dooms the tasting rooms. Instead, they’ve become gathering places after work, or before/after shopping and/or recreation. You’ll often see groups in a tasting room that you’d rarely see at a bar.

Without the typical late night hours of a bar, employees get home early enough to do some homework, put their kids to bed, or get a decent night’s sleep before their “real job”  (or college).  Likewise, these businesses avoid the occasional negative late night bar behavior that some places have to contend with.

While these limitations are restrictive, they’ve created a consumption tier that all but eliminates the negative behaviors sometimes associated with traditional bars.

The question is – what could be the premium-priced craft beer in your business?