This post is about psychology. Inspired by one specific facet of motivation and behaviour that is often overlooked. Why does winning drive some people to achieve extraordinary things and leave others cold?
Let me start with a health warning. I am not a professional psychologist. I have never studied psychology or had any training in the discipline. You could say that I am not even a rank amateur in the field.
I do know one thing about psychology. It underpins everything in economics and business.
If you want to understand better. Let me make two recommendations.
For a great business perspective on psychology then listen to a world class amateur in Charlie Munger (on human misjudgement).
Or get the professional view from Thinking Fast and Slow by the Nobel Prize winner Daniel Kahneman.
(Note that Professor Kahneman is a psychologist yet his Nobel is in Economics.)
All I have to offer is observations of real people in all kinds of business situations over the years. Unsystematic and anecdotal evidence if you like. Much of it gathered through business activities that revolved around winning and losing. Or at least were characterised in those terms.
I have enjoyed many great, even elaborate social occasions in celebration of wins. I have listened to ten times as many speeches or presentations bemoaning the fact that we don’t celebrate victory enough. And sat around countless tables analysing and agonising over every detail of a campaign.
In every case, the definition of victory was a business deal. Often a big sale to an important customer. But mergers, acquisitions, new hires, promotions, partnerships, procurement agreements are also seen in the same terms.
Don’t get me wrong, I enjoyed the parties (although I am getting a bit old for these things now).
Yet something always felt a little hollow. I didn’t feel the same rush that bubbled and popped in many of my friends and colleagues. It took me many years to recognise the reasons. For me, winning the deal or making the sale is the beginning not the end.
Selling versus doing
I was drawn into consulting because I like to help businesses become better. Since I found my way into SaaS and startups, I have kept to the same focus. Grow faster, be more efficient, develop new strategies, change culture, improve margins, enter new markets and many more. That’s how I have fun.
Making the sale or closing the funding round are means to an end. They give me the right to start doing what I love.
Sales or deals are a hard and painful process. Fuelled by adrenaline, myth and lots of late nights. The energy generates excitement. But the result is no more than another box ticked. There has been no value for the client. Nothing has been billed.
Closing the deal is the start of something for me. The process of creating value. The pressure to deliver. The sense of achievement. All begin after the win.
I don’t feel stress in a deal. Only when the overture ends and the show begins. Delivering what I have promised is the greatest pressure. Seeing the benefits realised offers the only real job satisfaction.
My world is very much services. Its an environment where the customer only pays after the job is done. The service provider is only as good as the last experience. Perhaps this means securing an engagement can never really be a win.
Yet I think the same principle holds true for product. If I pick your product off the shelf and pay for it, the sale is made. Is it good for your business if I hate it as soon as I open the box. No. Again the process of value and the customer relationship only begins after the sale.
Leopard or Impala - What makes the SaaS ecosystem?
I believe there are two basic types here. But the traditional type A/ type B comparison doesn’t work. So lets call them Leopards and Impalas instead. (I have also heard ducks and eagles but that was from an idiot so lets move on.)
I choose Leopards as the symbol not Lions because Lions are mangy, smelly, lazy scavengers in the wild.
Leopards are the hunters. Silent killers who stalk their prey and live for the hunt. The leopard is a beautiful, natural machine. Sounds pretty cool huh?
Then we have the antelope. I choose Impala to represent this crowd. It is the most common species in the Kruger Park and they are also sleek and stunning. Plus they are about the biggest antelope a leopard would take on as prey.
They gather in herds to defend against predators. When one moves, they all follow. The group takes precedence over the individual every time. The alternative is death.
By now its clear which type you want to be. And this type of image is common and widely accepted as a motivational tool. Hunters and farmers. Predators and Prey, Winners and losers. You can hear that motivational speaker revving up as I write.
But stop a moment and consider this. Impala graze the grasses, bush and trees. They keep the savannah clear and pristine. And they thrive and grow in huge numbers.
There are 2,000 leopards in the Kruger National Park……and 160,000 Impala.
So which species is more successful? Which model of evolution would you rather follow? Maybe that superficial impact is not so convincing.
I loved Yuval Noah Harari’s book Sapiens. One of the ideas that struck me most came early in the story of human evolution. Around 10,000 years ago our ancestors made the move from hunter/ gatherers to farmers. We developed reliable crops and gained control over a handful of animal species.
Its natural to talk about domesticating cattle and grains. But did man domesticate wheat or wheat domesticate man?
The Chairman's View
Its obvious that leopard and impala are both essential to the eco system. I think the same is true in business. Those who see a sale as victory are needed to drive through the obstacles and pain of the sales process. This is especially true for Enterprise SaaS.
Those who are only happy when their customer sees value are also essential. That’s how great products get built and excellent service is delivered.
A great business has a good mix of these two types. Its worth taking the time to recognise them and make sure you are developing that type of diversity in your team.
Both types are equally vital to creating value in your business. Too often I see rewards skewed towards the leopards. Sales are seen as some kind of rainmakers. A special breed who deserve super rewards.
This is a mistake which is embedded deep in business culture. The myth lasts long and spreads far. But sales do not generate value. They may close the deal. Success is a product of every element of the team.
Remember this when thinking about incentives and rewards. And think about it when you are building a business. Building a sustainable business requires the whole team.
Complaints about meetings are one of the hardy perennials of management. Alongside email, dealing with millennials and the stupidity of the C suite, you will hear this in along any corridor and around every water cooler.
Begin at the beginning
If you have a startup mindset, you may be tempted to think this is a real world problem and therefore a big opportunity. Spend any time on the subject and you will quickly learn that there is a solution out there already. Effective meetings are based on a well understood formula.
I could make this longer but you get the picture. And this is not new. Everyone in every business knows this.
Occasionally a new wrinkle appears. For example, Scrum or lean software development often relies on short, sharp meetings where everyone stands up.
This sounds new and smart. Yet the UK Privy Council has been meeting standing since time immemorial. (Note: This is literally true. Time immemorial is defined in English Law as being any time before 6 July 1189 and the Privy Council definitely predates this. Gotta love those lawyers!)
And I have never heard anyone hold this body out as an exemplar of efficient and decisive business meetings.
The hidden value of meetings
The truth is no-one can stick to these rigid rules. Meetings have a social value over and above their business purpose. Colleagues work in different departments or may be scattered across buildings and locations. In field work like sales, meetings may be the only time some team members return to base.
Even in small close knit teams live software developers, the daily or weekly meeting serves a purpose. Some things are just better shared with a group than in a one to one discussion. And Shakespeare’s Antony could never “cry havoc and let slip the dogs of war” over a coffee in the forum. It needs an audience, a meeting.
People like getting together and chewing the fat. No amount of logic and discipline over minutes and actions and agendas will ever change this. Human behaviour will eat any rationalist meeting approach for breakfast. Along with the biscuits and the bacon rolls if they are provided.
The other end of the telescope
I should apologise at this point. I will get to the other end of the telescope but my real point about meetings is that we should start in the middle. The “other end” would be working backwards from the actions to determine how meetings should be run. Tempting but no more likely to overcome human psychology than the traditional approach.
Instead my starting point is another common attitude. How often have you heard something like “I’m not sure if [insert name of meeting] is a waste of time but I always try to go along because its fun.”
Malcolm in the middle
That quote is the definition of a successful meeting. The attendees are motivated to attend. They enjoy being there. And they want to participate. Given these preconditions you can achieve anything.
So instead of starting with the purpose and agenda, go to the middle and build out.
How can you make this a meeting that people will want to join?
Bring together a group of people that like each other or feel they can learn from each other or have some other clear motivation to be in the same room together. Choose a time slot and venue that suits people’s diaries. If possible give them some additional motivation like free doughnuts or a couple of beers.
Once people want to be there you can think about what you want to achieve. This could be big decisions. But it might also be smaller things. For example, the core of the meeting might be to brief the team on a new strategy. The outcome you want is for each attendee to take away a couple of personal actions to make it work.
There is no need to have a hard line on actions and accountability. In this situation, that will feel like bullying not management.
And you want to people to enjoy the meeting. Otherwise, all that effort is a one off. They will come to your first meeting but not the next one.
Agendas are not required by Law
The final element is to think about what is needed in advance.
Most people like to know why the meeting is taking place. So a clear purpose is a minimum requirement. A simple statement like “Monthly Team Meeting” can be enough. No need to get evangelical.
For many meetings that is all the pre-work you need. Regular meeting have a rhythm of their own and an agenda is rarely necessary. An agenda and material to read in advance may be required. But there is no rule that says there must be an agenda.
A lot depends on timing. In a startup or a deal situation things can move fast. Advance notice can be tough to organise. I can remember, during a takeover bid, holding a Board meeting at midnight and scheduling the next one for 4 am.
Set agendas can be a straitjacket rather than a control. Especially in a startup. This week’s big issue can be superseded by the time you sit down to have the meeting. Any preparation should be set in the context of what is required for a good meeting. Not just a wish list of what you would like to talk about.
The Chairman's View
So there you have it. An alternative formula for good meetings. Plan how you can make the meeting good fun and add social value. Then set out what you can achieve - be realistic. And finally do the minimum needed in advance. No agenda without a reason.
One other thing. Most of this article is written in the context of the person drive ing the meeting. I have sort of assumed the reader is in a leadership position. CEO or founder for example.
And there is no doubt good meetings require good leadership.
Everyone has a role to play in this. Even if you are just a small cog in the business wheel. Come along to the meeting with the right attitude. Enjoy the discussion and work to make it fun for others. Make a note of your own actions and get on with it. Don’t wait for the minutes.
Leadership is about you, not about job titles.
This particular learning has been front of mind for me during the past week. And things right v the right thing turns out to be a good way of shining a light on some of the more frustrating moments.
Are we making it easy for startups to do business?
I like to focus on helping entrepreneurs and companies. There are plenty of other smart people and organisation trying to help in the same way. You would think that making life easy for founders would be important. And on the face of it, Scotland and the UK should be a good place to achieve that.
There are a handful of key measures Economists like to turn to when explaining the relative economic performance of different countries. A favourite is the Ease of Doing Business index compiled by the World Bank. The UK ranks 7th in this list and 16th for the specific category “Starting a Business.”
Yet it doesn’t seem to work out that way. So often a promising startup pitch becomes entangled in a web of process and bureaucracy
Or tangling SaaS in a web of complexity?
One recent experience sticks in my mind. The entrepreneur had a strong, simple idea in a high value life sciences niche. Life sciences is not my speciality but this lady was the best entrepreneur in the sector that I have seen in the last 4 years. It was all clear and compelling. Questions were answered with confidence and little bit of brio.
Then we got to IP.
And found what felt like dozens of unanswered and unanswerable queries. Many of which lay in then hands of an organisation that I know is committed to helping companies like this get started. Yet the founder was left unable to get to any clear answer. Never mind a simple one.
And there are plenty of other areas where the ecosystem designed to help has enmeshed startups in complexity they don’t need.
On the very same evening I heard about challenges related to complex shareholder arrangements for a company that has not product yet and has not started trading. Questions surrounding the best way of ensuring that a startup qualifies for EIS or SEIS, the two excellent tax incentives that exist in the UK. And another entrepreneur worn down by the time and effort required to go through the process for a pitching competition designed to give startups free money.
This happens all the time.
Sometimes its the founding team that initiates the problem. In other cases, the system designed to help is just too process heavy. But every time there is more people like me and other senior mentors could be doing to help.
Matters of shareholder law and contracts, tax incentives, distribution of public money and IP are all important to get right. Risk and complexity do exist in these arrangements. The way this reality is approached is wrong.
Complex solutions are offered and pursued. Or worse, the situation is allowed to go unresolved. Professionals and others weigh the options while the startup tries to move forward. In time, the weight of this uncertainty becomes crushing. A huge obstacle to investment. And a real drain on the time and energy the founding team needs to get things moving.
The Chairman's View
Too often (and I include myself in this) experienced professionals hear the problem and switch straight into doing things right mode.
We all need a big dose of doing the right thing mentality.
In the shareholder example above, there was a lawyer in the room. The entrepreneur explained what he wanted to achieve with his co-founder. Rather than taking him at his word, she challenged the underlying thinking. Take an alternative approach and get a simpler, faster, cleaner solution.
Great work Julie.
Advisors need to look for the simple way through. Resolve obstacles and move forward. Or to be clearer, get shit done. There is nothing worse than confusion and uncertainty. Not knowing your IP rights or shareholder structure kills any investment and the business with it.
So the job of an advisor is to make it easy for entrepreneurs to focus on innovation getting in front of customers. That is doing the right thing.
Competitive pitching drives a whole lot of bullshit.
Its become one of the centrepieces of every startup ecosystem. If you want to build a reputation, grab some PR, grow your network, win cash prizes and generally just fit in, you need to pitch to win.
Founders are groomed by a whole coterie of experts and supporters. How to hone your message? How to pitch your startup? Get yourself investment ready? Business is framed as a race and only the fastest and strongest are winners.
Kenny Fraser is the Director of Sunstone Communication and a personal investor in startups.