Why a 3-year-old makes for a better leader than most adults.

I just came back from week long trip to Dubai where I got to spent a good amount of time with my 3-year-old niece. The more time I spent with her the more the realisation dawned on me that kids really exhibit the raw traits of great leaders better than most adults! Here’s why

 

  1. Kids keep asking WHY

 

Spend time with any kid and you’ll be drowned with a series of Whys. Why are you here, why are you leaving, why are your trunks wet? Then you say “because I got in the pool” which in turn is followed by ‘Why?”.

 

Kids start with Why. And so do great Leaders, as Simon Sinek so eloquently argues in his book by that name: Start with Why.
Why are we building what we are building? Why does doing what we do even matter? Why are we doing things this way? True that was a good way to do it yesterday but Why is it still relevant today? Why have we made these decision? Or – more importantly – why have we not?

 

If you keep asking why firstly you will eventually – with a few more wrinkles under your eyes – foster a culture of always ALWAYS challenging the status quo.  This is a must for any company that wants to stay relevant. You cannot afford to take anything for granted in business.

 

Secondly, you will instil a sense of purpose within your organisation. People will understand why things are happening, why they’re happening in the way they are happening, why their sweat and hard work matters, and therefore why they should get out of bed tomorrow and come back to work.

 

This holds true for customers as well. Tell a customer what he is getting and –  unless it falls in the rare category of being a total giveaway – they will consider it sceptically at first. But tell them WHY that thing will change their life, or that of others, and you’ve got them hooked. Their purchase now has a purpose, not just a utility.

 

  1. Kids like story-telling

 

Kids don’t do well with matter-of-fact talk as I found out the hard way. Dry factual statements don’t engage them. Stories do

 

It really is the same in business. Present your team, shareholders or customers with a matter of fact statement and they will at best give you a nod.  Dress it up in a story and you may put a smile on their face. You win people with stories.

 

Which is why great leaders are great story tellers. They are anecdotal, witty, humorous, and engaging. Think Winston Churchill.  They get the message across to you via mesmerising story telling.

 

Perhaps the best known example of this is Steve Job’s Stanford commemoration speech where he famously opens up by saying “today I want to tell you three stories from my life… that’s it, no big deal, just three stories

 

That speech was literally three personal stories, but within them a wealth of wisdom dressed up in such a way that it made the messages unforgettable. Had he just recited his words of advice like he famous ‘stay hungry, stay foolish’ in a straight matter of fact way it would not have resonated the same.

 

  1. Kids like to say NO

 

Ask a kid to share their candy with you, give you a hug, come play with you… unless you hit them in a good moment or bribe them with something their instinctive reaction is to say NO. Not ‘No because…’; just ‘No’

 

Running a company is quite the same. People will keep asking for more no matter what you give them. No customer is eternally happy. Give them a discount, they’ll keep coming back for more. Until you say NO. Give your employees some perks, a salary rise, a pat on the back… they’ll keep coming for more. Until you say No.

 

The groomed ‘MBA way’ is to be transparent with them, engage in dialogue, present them with your limitations, with your annual budget, you may even transparently share your P&L and show your razor thin margins expecting naively that they will just know better than to ask given how transparent you’ve been. Wrong. They will keep asking. Until you just say No.

 

Not that long ago I made this mistake. After I overheard whispers in my company PeoplePerHour such as ‘but if we are doing well why aren’t we getting salary rises or why are we sensitive to costs’.. I thought I’d address the issue the civilzed way. I spent hours explaining to my people, team by team, drawing charts on whiteboards showing transparently how our costs are rising in comparison to our revenues. I explained that the ‘delta’ (a terms that’s now become anecdotal in the company’) needs to be widening for a healthy business. That’s it plain and simple. An undisputed statement of fact – not a story.

 

Total waste of time. None of that stuck. And given that not everything can always be packed in story telling, sometimes its just commanding to simply say NO.

 

  1. Kids are instinctive

 

When you try to bribe a kid with candy they will look at you judgingly with piercing eyes, as if thinking “what’s this guy up to…”. They are too shrewd to fall straight in the trap.

 

The logical decision would be to take the ‘candy’ if it’s up for grabs. Customers would certainly do that without blinking once! So would your employees and your shareholders. Do you think they’d be like “hmm wait why is this guy offering us a dividend, sounds fishy”. Not a chance.

 

Lacking the tools to make a fully formed logical ‘analysis’ of a situation or follow the empirical evidence forces kids to use their intuition, or instinct. They operate ‘from the gut’ as Jack Welch used to famously swear by, much more than most adults do. It’s refreshing and almost always gets a better result.

 

Conversely having an over developed logical brain can be a handicap both in life and in business. Its like having a tool that’s too sharp for its own good. You tend to over-analyse, over-think things and get stuck in indecision. Indecision is – in the end – much more expensive than even the wrong decision. Have you ever seen a kid be indecisive?

 

There’s good reason why instinct matters. Firstly it’s the thing that differentiates us from a machine. Logic is limiting by definition, whilst intuition and its derivative – imagination – is boundless. Einstein put it perfectly:  “Logic takes you from A to B, but imagination takes you everywhere”. Man can no longer compete with computers in processing logical sequential thoughts. But we do better in scattered imaginative thinking.

 

Secondly, our limbic brain – the part of the brain that’s responsible for all our feelings such as trust, loyalty and intuition -– is actually more developed than the rest of our brain, and forms first at the core of the human brain. It’s the part of our brain that controls all emotions but can’t for example process language, numbers or logic. But its what tells us if something ‘feels right’. Decisions made with the limbic brain tend to be faster higher-quality decisions but our logical brain tells us to ignore them. Simon Sinek in Start with Why calls this the ‘overthinking’ syndrome and explains

 

“The more time spent thinking about the answer, the bigger the risk that it may be the wrong one. Our limbic brains are smart and often know the right thing to do. It is our inability to verbalise the reasons that may cause us to doubt ourselves or trust the empirical evidence when our gut tells us not to”

 

Very simply the reason gut or instinctive decisions feel right is because the part of the brain that controls them controls our feelings too.

 

  1. Kids are fearless

 

Being indecisive and fearful one could argue are both different expressions of the ‘overthink’ syndrome. But not quite. Kids demonstrate this too: sometimes you’ll see a kid go for it after evaluating the odds, whilst adults won’t.

 

If logic is our brain’s desire to process information in order to make a decision, fear is HOW MUCH information we need in order to be comfortable with it. To feel safe.  A high threshold on both is a double handicap.

 

Jeff Bezos recently said in another amazing memo to his employees   “most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow

 

So true.

 

Speed matters in business (and in life), so if you multiply all the decisions that are taken daily across an organisation by that extra 20%, it could easily be the difference between success and failure.  ‘High velocity decision making’ as Bezos puts it is crucial in remaining nimble or ‘Day1’ as he likes to call it.

 

In other words, seen in context with intuition: trust your initial gut as a first port of call, your limbic brain is telling something for a reason. But if you must deploy logic and analysis, make sure it doesn’t become paralysis.

Or hire a three-year-old!

Cut & Paste doesn’t work for startups!

One of the worst pieces of advice you can get when building a startup is the classic “Airbnb [or Apple or Google] does it this way, so should you”. Its incredible how many investors give that advice thinking you can retrofit substance to process. If it were only that easy to cut & paste there wouldn’t be any figuring out to do would there? Why is it then that first time entrepreneurs have a higher success rate? Because they are hungry, and their lack of knowledge is the best weapon. They are not afraid to ask the dumb questions. They think fresh and solve problems. Ignorance is bliss.

 

Last week I met up with two different first time entrepreneurs, super smart founders and CEOs both of venture backed business. We went for a beer to catch up and share war stories. PeoplePerHour is a little further ahead in the journey so I had the benefit to reflect on some of my many screw ups and do most of the talking while they enjoyed their beer!

 

We discussed how we manage our time, our team, how we handle meetings . What we do and don’t get involved in. I was not amazed that each of them were making the same mistake (which I also made many times). One said to me “our VCs said to me recently that Apple’s leadership team spends 3 hours just ‘talking about random stuff’ on Monday mornings… so we should do the same. It fosters creativity and innovation lalala.”  My instant reaction was “are you out of your fucking mind?” Firstly, there is a slight difference between a ten person startup and a company like Apple. Maybe at their scale talking casually about ‘random stuff’ with no agenda works because a) someone else is doing the hard work of executing and b) they may be having a good problem to have which is – where the heck to we invest our cash mountain next? Do you really think that when Apple started in a garage Woz and Steve Jobs just sat in a room talking about random shit waiting for a business to get built?

 

The other Founder I met up with similarly was spending all this time doing X because his investors told him that it worked for another portfolio company. That’s absurd logic. You will find tonnes of things that work for what are seemingly similar businesses but don’t work for you. The devil is in the detail. All that matters is what YOUR business needs NOW. That may change tomorrow. You can’t retrofit substance to process. You figure out what builds and sells the shit and fit process around it. And in a fast growing startup you probably need to rethink that every other month if not sooner.

 

At PeoplePerHour we went through this cycle multiple times. A process of holding a management meeting with everyone round the table sharing what they’re each doing worked well. Until it stopped working! So we changed it. Why did it stop working? Because we HAD to go from a phase where we needed to innovate and hence conversation was necessary, to a phase where it was all about straight line execution. In that phase, you need as little conversation as possible. You just need to roll up your cuffs and execute. You’ve figured out how to climb the mountain, so now you need to shut up and start climbing!

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An example of the worst possible service you can get – complements of Best Buy Inc.

I rarely slag of companies in public but this experience has been so appalling I feel the need to share it with the world

I recently move apartments so on September 4rd I duly commissioned GeekSquad (a subsidiary of BestBuy) for the second time (repeat customer no less!) to come and install my projector in my new place. I should mention this is a pretty heavy piece of kit, quite a high end spec that cost me over $4000

The GeekSquad team arrives. With ATTITUDE I should add. From the start one guy was constantly winging about how X or Y or Z was not mentioned in the work order. IT WAS. And I know that because I had the same issue last time so this time I itemized everything in granular detail. I even sent them the full spec, the amazon receipt and the whole shebang. They even mentioned that I had to move my own furniture around as they are prohibited to move other people’s stuff. Question: how the hell do you get a projector on the ceiling without moving something? Including the projector! Idiots. That’s already my equipment.

I left them to it and was unpacking other things to filter out their winging. A few minutes later I hear a loud BANG! One of the two idiots (they share a brain cell between them at best and that’s on a good day!) dropped the thing on the floor and smashed it.

Fair enough. Mistakes happen. I tried to keep upbeat as they reassured me I would soon get a call from their insurance to ‘sort it out’. Mean time their manager – another incompetent idiot called Miguel – called me to tell me the next steps. The only issue was – he didn’t know what they were! He told me he would find out and call me back

In the end they left me with an Insurance claim number and went their way.

The sequence of events that ensued is just a comedy. And this is just the summary:

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3 Defining qualities of great entrepreneurial leaders

http://upstart.bizjournals.com/resources/advice/2014/09/18/3-defining-qualities-of-great-entrepreneurial.html

Great leaders may possess a myriad of attributes, not the least of which are intelligence, charisma and natural charm. All of these things matter. However, you can be a great leader and not be naturally charming or very intelligent. In my time at PeoplePerHour I’ve learned a lot about leadership. I have come to the conclusion that there are three key attributes a great leader must have.

Vision

The ability to amass a great team, motivate and inspire them is plain useless if you don’t have a clear vision of where you need to go. Leadership is first about seeing the future and then about being able to figure out a feasiblepath to get there. It’s seeing the iceberg before the Titanic hits it and taking fast and decisive action.

It’s doing the one right thing rather than doing many things right. It’s being different, not following the herd, being controversial, and seeing what others don’t see. It’s having a nose for what’s coming and the eyes and ears to react before others do. Without vision, you can empower people all you like but you won’t get anywhere. You’ll have a following but no direction. You may make a great motivational coach, but not a leader. Every difficult situation needs a visionary leader to point the way and make a tough decision.

Influence

Once you have a clear vision (but only then), you need a sting following. That requires the power of influence. Whether you are in an existing leadership situation or the creator of a group, this is very hard thing to do. In either case, you are new to the situation and the odds are against you. Why should people trust someone new? The vast majority of people are resistant to change, no matter the odds. In order to fulfill any grand vision, you need to drive change. Otherwise you are just a puppet master holding the strings waiting for the show to end.

Influence people across the board — explain to employees the benefit of leaving secure jobs and come join you; convince investors to give you money at the very beginning, get customers and fans to support you, your bank manager to give you an overdraft, your landlord to give you a lease and rent-free period; and your wife to put up with sleepless nights, cold sweats and no pay. Carry that burden of influence with you. If you go down, you take more people with you than yesterday.

Courage

The third element is the most challenging. You’ve clarified a vision and built a following by charming, coercing, schmoozing…ultimately influencing enough people. After all this work, you realize that it’s only day one. Now you have your boat (more like a raft) and your compass. But you still need to cross the ocean. This is the final and true test of great leadership. It ultimately comes down to courage. Intelligence and knowledge are advantages of course, but without courage they are wasted.

Courage alone could and would get you there, albeit slower and with more pain. So the key question is: Do you have the courage to keep going when everyone tells you to turn back; to know you’re right when everyone says you’re wrong; to stick to your instincts when people call you crazy; to carry other people’s weight when they fall; to set the tempo and beat the drum despite how tired you may be? It’s your job to keep people together when they are drifting apart and losing faith, to give them courage but not false hope, to let go of some to save many, and to weather the storm but not bask in the sunlight when it ends — because it never does.

Vision and influence will make you a well equipped captain. But courage is what gets you there. On the other hand, courage alone makes you a fighter without a cause. You may be good at creating lots of noise, but to paraphrase Sun Tzu’s “Art of War”: that’s just “the noise before defeat.”

 

The 3 attributes of true leadership

“The ability to charm dogs off a meat truck”…   “When people want to follow you even if just out of curiosity” …  “The ability to make the other guys feel in charge”.  To “empower”, to “motivate”, to “inspire”…  The list of attributes to what makes a great leader is countless.  They all make a good read, but none of them fully capture the true essence of what makes a great Leader in a complete way, I believe

Great leaders may posses a myriad of attributes, no least of which are smarts, intelligence, charisma and natural charm. All of these things matter. However you can be a great leader and not be naturally charming or very intelligent, or many of the other attributes named. continue reading »

Are you thinking long-term enough?

Warren Buffet was once asked by Jeff Bezos a long time friend of his: “you are the second richest man in the world and yet you have the simplest investment thesis. How come others didn’t follow this?”  To which Warren Buffets responded: “because no one wants to get rich slowly” 

In a nutshell that’s what’s wrong (or rather what’s not quite right) with a lot of the investment community today, from public markets to private equity investors and unfortunately it trickles down into too many companies. You can’t time-box success. You can’t sprint a marathon. And you can’t measure success with speed but only by the  magnitude (and significance) of the end result.  Building to flip is easy. Building to last is difficult and you cannot take short cuts.continue reading »

Whats better than being the boss is being the customer

I was recently at a gathering of entrepreneurs and we talked about our challenges, what we like and what we don’t like about what we do. And one thing struck me: no-one in the group actually enjoyed being the boss (me included). And by that I don’t mean that they don’t value the independence. We all do. But we all see managing people as a necessary evil, a means to an end not the end itself.

And when i thought about it it actually makes sense. Entrepreneurs (or at least the true breed of entrepreneurs) are not people who rise up the ranks and become CEOs. They are mavericks, the round  pegs in the square holes, people who don’t abide by social norms or fit in  large groups be it social groups or corporations. What drives them is an itch to innovate, to create products that serve customers in ways that are either totally novel or just better than what’s out there already.

I’ve not heard one entrepreneur tell me that they started a business because their dream was to be a manager. In fact most exceptional entrepreneurs are terrible managers. They are visionaries who see what others don’t, they are go-getters who take risks and go out to build what they see. But they are not managers. They are too impatient, temperamental, too firey and passionate, and have high standards. Too high for most people to meet, at least consistently. Managing is something that comes with the ride and has to be thrown into the mix.continue reading »

20 Tips on becoming a better CEO

The best businesses scale faster than their people.  Learning to be a better CEO is crucial for entrepreneurs who don’t set off to me managers, they just fall into it by virtue of their creation. Below are my Top 20 learnings

1. Be fair

Fairness comes first. You can be tough and even brutal at times but be fair in your judgment, give credit when credit is due. No one wants to work for someone who is unfair. Even when you are let down, hold people accountable to it, but when push comes to shove swallow your pride. Be the bigger Man, after all you are CEO.

2. Show empathy 

Show empathy not sympathy. Sympathy is letting emotions rule you. Its feeling sorry for people. Empathy is getting under other people’s skin to understand them. As a CEO its your job to get under the skin of your customers, your staff, your stakeholders and figure out what makes them tick. Keep it human. Don’t let your success go to your head. Emotional intelligence is as important (if not more) than analytical intelligence in running a business.

3. Be the benevolent dictator 

True democracy does not work in business (if anywhere). Drop the ‘decisions by committee’, the never ending conversations. It will slow you down, create bureaucracy, indecisiveness, and will eventually kill you. Listen to everyone’s opinion, create healthy debate but then take a firm and binding decision.  Show decisiveness and conviction. Align everyone to your decision and march forward relentlessly. It matters less to be right all the time. You never will. You will be wrong some times. Its OK- learn to fail fast and realign. The benevolent dictator is the one who is decisive, takes action with best intent at heart.continue reading »