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Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
Day 4 Morning   Operations, Chuck Colford And Brian Hurley
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Day 4 Morning Operations, Chuck Colford And Brian Hurley

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  • 1. Lead to Win “The time has come,” the Walrus said, “To talk of many things”… “Operations” - Lewis Carroll June 23, 2009 Chuck Colford and …A great many things indeed Brian Hurley Lead to Win
  • 2. Operations – Not such a dirty job It can always be worse… Slide 2 Lead to Win
  • 3. Scope of Operations •  Finance •  Human Resources •  Engineering •  Manufacturing and Supply Chain •  Customer Support •  Product Management •  Marketing •  Sales •  Site Management •  ICT •  Board of Directors •  Investors •  Advisors Slide 3 Lead to Win
  • 4. Scope of Operations •  You will not be an expert in all domains – and don’t need to be •  You do need to know how to build a team and get results from the team •  You do need to know about where the bear-traps are – learn from the mistakes and pain of others Slide 4 Lead to Win
  • 5. Agenda •  The Team •  Steering the Ship •  Selling Related Finger Food •  Money Related Fun •  Burnt Flesh Potpourri Slide 5 Lead to Win
  • 6. Self-Awareness is Important to Operational Success •  Know yourself •  Cover your weaknesses •  Hire people who are better than you to strengthen the team •  Learn from your mistakes… or better yet, from the mistakes of others Slide 6 Lead to Win
  • 7. Hiring Great People •  Structured interview approach against a written role description to probe if they are suitable candidates •  During initial call: –  Be explicit about what the expectations are in your start-up relative to a big company – better to scare them away then hire the wrong person –  Share company’s objectives and vision – they must want to be part of the quest –  Share your company culture – it must resonate •  Invest time and resources on candidate selection in stages, e.g. –  Call with designated internal recruiter –  Meeting with hiring manager –  Meetings with other team members –  Reference checks –  Offer/negotiation Slide 7 Lead to Win
  • 8. Hiring Lots of Great People Quickly •  Get a professional to lead the effort •  Centralize the effort and establish a pipeline process •  Prepare a hiring collateral package •  Only bring in working staff for good candidates •  Get creative on attracting attention and buzz •  Great people know great people •  Keep the bar high http://www.ottawabusinessjournal.com/288580326461284.php Slide 8 Lead to Win
  • 9. Terminating People Who Don’t Fit •  Formal employment agreements make things easier –  “Without cause” terms should be defined in contract •  Engage HR professional – easier to do it right than to deal with consequences of a poorly executed termination •  Treat employee with respect •  Never hire anyone you are not willing to fire –  Avoid hiring founder’s relatives or spouses –  Avoid hiring friends –  Avoid hiring investor friends or relatives –  etc •  If you ever enjoy firing people you should consult a doctor Slide 9 Lead to Win
  • 10. Rock Stars (“Big Names”) Can Help or Hinder •  Big Names can help •  Big Names can Hinder –  Experience –  Big ego –  Open Doors –  May not actually work –  Reduce interval to sales very hard –  Help recruit –  May not deliver on •  Typical Roles commitments –  May not hang around –  Advisor long –  Management –  May work to replace the –  Board Member founders •  How –  May try to redirect the –  Personal relationships and company into a introductions company they want to –  Don’t be shy do (or have done in the •  Why past) –  Exciting Vision –  …. –  Upside –  People –  Personal visibility –  Access to people or companies –  Retired and bored Slide 10 Lead to Win
  • 11. Hiring is NOT your only option Best of both •  Escape your “employee mindset” experience worlds is –  Many of you will bootstrap and grow by contracting possible – –  So why then is the natural instinct to fill up with employees? Contract •  Advantages to using contractors first and hire –  “Try before you buy” – Easy to escape bad recruiting decisions if good fit –  Limited obligation – reduces your liability –  Supports variability of your business –  Good sub-contractors can become great advocates •  Disadvantages –  Less “loyalty” (often overstated – HBR “They’re not your people”) –  More turnover & recruiting efforts to replenish –  Grant incentives may not apply (SRED, et.al) –  Harder to establish “brand” Slide 11 Lead to Win
  • 12. Outsourcing by Function Getting the •  Very common to outsource things that are not: right –  Your core competency expertise –  Where you build value when •  Common functions required may be –  IT, Website development & maintenance critical to –  Office Manager, Clerical, Payroll success –  Bookkeeping, Accounting –  Legal Counsel, IP (Patent Agent) work –  HR –  Specific Subject Matter Experts (SMEs) as required •  SRED or IRAP write-ups •  Sales, Marketing Slide 12 Lead to Win
  • 13. Outsourcing – Thinking Outside the Box Consider all •  Pay an open source or shareware developer to possibilities! install, personalize or add a key feature to their Do what makes application so it better serves your business sense. •  Rather than cash: Can services be bartered, paid in stock or warrants? •  Variable rates: Pay one rate pre-revenue; then top up to premium rate post revenue? Slide 13 Lead to Win
  • 14. Subcontractor Agreements These are •  When dealing with subcontractors, where you direct the work, NOT rocket you should always put in place a standard sub-contractor science – agreement. •  Why? your legal –  Rate, payment schedule, GST in/out, termination notice periods counsel will are clearly established have one. –  It legally identifies them or their corporate identity including Use it! business/GST number –  Defines who owns IP –  Liability: what if they damage clients facilities, breach security? –  NDA, confidentiality requirements. Any security clearances or checks required –  Reporting requirements; Scope of work defined. –  Supports you when audited “So – what is this cheque you wrote for?” Slide 14 Lead to Win
  • 15. Advisors Can Fill Gaps Inexpensively •  Engage experts to be advisors: –  In areas of weakness (e.g. sales) –  Where it is too early to hire a full time person –  Where they can provide a customer perspective –  Where they are a potential partner or channel to customers –  To provide credibility •  Limited time commitment – a few hours a week or a month •  Advisor compensation: –  Free – usually as long as the work is interesting, pleasant and not excessive –  Stock –  Retainer/honorarium/contract (i.e. cash) Slide 15 Lead to Win
  • 16. Agenda •  The Team •  Steering the Ship •  Selling Related Finger Food •  Money Related Fun •  Burnt Flesh Potpourri Slide 16 Lead to Win
  • 17. Managing Teams – Vision, Culture “There go my people. I •  Vision must follow them, for I –  Points the way, generates am their excitement and common purpose leader” •  Culture – Mahatma Ganhdi –  Sets the context for independent and group actions in situations not formally specified, establishes norms Slide 17 Lead to Win
  • 18. Managing Teams – Take Charge •  Only one leader –  Not a democracy “When in –  All the founders can not be the CEO command… •  Set Roles and Responsibilities –  Reporting structure – formal organization chart take charge” –  Decision Making Authority –  For work and people management – not rigid communications silos –  Orients new staff •  Setting Objectives –  Company, Individual –  Must do, WBN •  Staff performance management –  Dealing with low performance –  Dealing with disruptive individuals –  Regular reviews and feedback •  Staff development –  Informal, formal –  Selective apprenticeship Slide 18 Lead to Win
  • 19. Managing Teams – Day to Day •  Regular staff meetings – efficient, regular (even if you are not there) •  Action registers – with follow-up and load balancing •  Make compromises explicit and formally managed •  Common (enforced) secure file repository (more on this later) •  Common (simple) reporting –  Limit formal reporting to what is required to get the job done and consistent with phase •  All-hands meetings – inform, motivate, celebrate, socialize •  Transparency – be open in sharing information and responding to questions •  Accessibility –  Open door policy –  Management by walking around – engage, ask to hear the problems and over -communicate the vision/plans/successes –  Skip-level lunch meetings – inform, engage, socialize •  Carry the water when required •  Lead by example – your actions define the acceptable “norm” •  Formal policies as (and when) required, e.g. use of open source, working from home, vacation management, travel, expenses Slide 19 Lead to Win
  • 20. Bringing the Team to Bear •  Listen more than you talk –  Use active listening techniques where you summarize for understanding and confirmation •  Seek out and engage all team members –  Control group discussions in a positive manner to draw out the quiet members •  Use delegation effectively and frequently •  Learn and use common methods to allow a team to: –  Make decisions –  Solve problems –  Develop new ideas –  Learn from the past and look to the future –  Engage in continuous improvement –  Manage conflict constructively Slide 20 Lead to Win
  • 21. Delegation •  Clearly define the task Bring everyone to –  What bear on –  When building the –  Scope of authority business –  Resources available –  Reporting requirements •  Select the best person for the job •  Train your staff for the tasks •  Motivate people by trusting them •  Get and give feedback –  How do they feel about their progress? •  Let the assigned people to do the work! –  Avoid jumping in or interfering Slide 21 Lead to Win
  • 22. Problem Solving Techniques •  Appreciation - Extracting maximum information from facts •  5 Whys - Getting quickly to the root of a problem. •  Cause & Effect Diagrams - Identifying likely causes of problems •  Affinity Diagrams - Organizing ideas into common themes •  Appreciative Inquiry - Solving problems by looking at what's going right •  Flow Charts - Understanding process flows •  Risk Analysis and Risk Management •  SWOT - Analyzing your strengths, weaknesses, opportunities and threats •  PEST Analysis - Understanding "big picture" forces of change •  The Marketing Mix and the 4 Ps - Understanding how to position your market offering •  The Ansoff Matrix - Understanding the different risks of different options •  The Boston Matrix - Focusing effort to give the greatest returns •  Porter's Five Forces - Understanding the balance of power in a situation •  Core Competence Analysis - Get ahead. Stay ahead. •  USP Analysis - Finding your competitive edge •  Critical Success Factors - Identifying the things that really matter for success •  The Greiner Curve - Surviving the crises that come with growth •  The McKinsey 7S Framework - Ensuring all parts of your organization work in harmony www.mindtools.com Slide 22 Lead to Win
  • 23. Leveraging Creativity •  Reversal - Improving products and services •  SCAMPER - Generating new products and services •  Attribute Listing, Morphological and Matrix Analysis - Creating new products, services and strategies •  Brainstorming - Generating many radical ideas •  Reverse Brainstorming - A different approach to brainstorming •  Reframing Matrix - Looking with different perspectives •  Concept Fan - Widening the search for solutions •  Random Input - Making creative leaps •  Provocation - Carrying out thought experiments •  DO IT - A simple process for creativity •  Simplex - A powerful problem solving process •  TRIZ - A powerful methodology for creative problem solving www.mindtools.com Slide 23 Lead to Win
  • 24. Decision Making Techniques •  Pareto Analysis - Choosing what to change •  Paired Comparison Analysis - Working out the relative importance of different options •  Grid Analysis - Making a choice taking into account many factors •  PMI - Weighing the pros and cons of a decision •  Force Field Analysis - Analyzing the pressures for and against change •  Six Thinking Hats - Looking at a decision from different perspectives •  Starbursting - Understanding options better by brainstorming questions •  Stepladder Technique - Making better group decisions •  Cost/Benefit Analysis - Seeing whether a decision makes financial sense •  Cash Flow Forecasting with Spreadsheets - Analyzing whether an idea is financially viable •  Decision Trees - Choosing by valuing different options www.mindtools.com Slide 24 Lead to Win
  • 25. Decision Making – Who, What, When Key concepts: •  Who owns the responsibility? –  Designated –  Delegated •  What stakeholders are affected? •  Quality - Are all the facts and alternatives known? •  Time - How long until the call must be made? A BAD decision is one that: –  Is made by the wrong person - Violates delegation or authority –  Does not consider the impact on the stakeholders –  Is unsupportable by the majority of stakeholders –  Is made in haste (before facts and alternatives are understood) –  Takes too long (occurs too late to have impact, squanders resources) Don’t confuse a bad decision with a bad outcome Slide 25 Lead to Win
  • 26. Decision Making – Calling the Shots Leadership When the person who owns the decision is known (lets assume it is always is you), various styles may be employed to make it: situational! 1.  You decide alone. 2.  You seek information and then decide alone. 3.  You consult with individuals and then decide alone. 4.  You consult with the group and then decide alone. 5.  You share the problem with the group and you all mutually decide what to do. •  None of the above are wrong. •  The person who owns the decision chooses. •  When choosing to consult for information or advise, be careful not to send the wrong signals – if you plan to make the call yourself. Slide 26 Lead to Win
  • 27. Decision Making – Balancing buy-in with Action •  Since the Magna Carta – the King has not had absolute power: Very few –  The CEO serves at the pleasure of the Board decisions –  The customer can take their business elsewhere are fatal – –  “They’re not your people” – They can leave with 2 weeks notice Get on with –  So… Buy in is important it! •  You must balance need for “buy-in” with need to move forward •  You will fail if you try to please all the people all the time –  Leadership is not about popularity –  All your decisions will not be loved (It sucks to be you - get over it!) •  You will exhaust yourself and your team if everyone needs to be involved in everything –  Use decision style #5 sparingly – for serious or “bet the company” issues –  Beware compromise – It produces horrible results! Compromise is often a position that no-one supports. –  Instead, strive for consensus – A decision that everyone can agree to support (rather than undermine) Slide 27 Lead to Win
  • 28. Decision Making Tips – “House Rules” 1. Wait until the last minute - but not a minute later. "If you're not going to do anything differently tomorrow by making a decision today, then don't make it today. Situations change; markets shift. That's not an excuse to procrastinate. But the best decisions are just-in-time decisions. You should decide as late as possible - but before you need to take action." 2. Don't be afraid to argue. "Conflict is good for an organization - as long as it's resolved quickly. Unresolved conflict is a killer. That's why real leaders deal with conflict head-on. They take individual feelings seriously, but then they get beyond those feelings. One way to make progress on a tough decision is to agree on what the question is. Agree on the wording and write it down. Debate often stems from having different ideas about what's being decided." 3. Make the right decision, not the best decision. "People can spend months debating the 'best' decision without actually arriving at any decision. Every decision involves risk. And if there are 10 ways to do something, 8 of them will probably work. So pick 1 of the 8 and get going. Life's too short. You have 10 more decisions to make after this 1." 4. Disagree - and then commit. "Not everyone gets a chance to decide, but everyone should have a chance to be heard. Without at doubt, the most vigorous debates yield the best thinking. But once a decision is made, you should not be able to tell who was for it and who was against it. Fully supporting decisions that have been properly made is a condition of employment." - Dave House – Bay Networks Slide 28 Lead to Win
  • 29. Conflict Management •  Conflict is natural - happens in every organization •  Conflict is good – brings out different points of view •  Unresolved conflict is a killer – stops progress, destroys teams Slide 29 Lead to Win
  • 30. Conflict Management – Straight Talk •  Address the issues directly with the person with whom you have the conflict –  You may have misunderstood –  They may have misunderstood –  They may not have all the information you have –  You may not have all the information they have •  If possible do it privately and 1 on 1 Slide 30 Lead to Win
  • 31. Conflict Management – Straight Talk If you are in disagreement: If someone disagrees with you: •  State up front that you disagree – •  Listen to their position explain why •  Do not be defensive – consider •  Ask the other person to state alternative options why they came to their decision •  Actively listen and feed back what •  Do not attack you think you heard •  Actively listen – ask questions •  State your position and get clarification – be open to •  Ask questions – be receptive to change change Slide 31 Lead to Win
  • 32. Conflict Management – Straight Talk Recognize the conflict Address directly Gather more data or State your case meet with consultant Listen YES Discuss Need Agreement NO information/ consultant YES NO Implement Escalate Slide 32 Lead to Win
  • 33. Time Management •  Time management is extraordinarily important! •  Self-discipline •  Key elements of effective time management: –  Goal Setting –  Activity Planning –  Prioritization –  Prioritized To Do Lists –  Scheduling –  Managing Interruptions http://blog.iqmatrix.com Slide 33 Lead to Win
  • 34. Avoid Busywork from Investors •  Investors will tend to use their portfolio companies –  To extend their own personal research and support groups –  Which defocuses you and sucks time and energy –  Common practice is to call up a portfolio company to do research on other deal flow items •  “What do you think about…” •  “I need a white paper on…” •  “How would your offer stack up against…” •  Even if you delegate, you will be dragged into discussions later •  It is a slippery slope –  Carefully balance collaboration goals with need to keep your business focused on winning customers. –  Once you have done a few, the precedence is established and it is more work to wean them off –  Be mindful what is occurring. Slide 34 Lead to Win
  • 35. Meeting Tips •  Very few meetings make you any money – minimize these –  Always ask yourself “Why do we need to have this meeting?” –  Know before it starts – Know what you will have when it is done. •  Not everyone needs to be in every meeting –  When you have a small team, it is important to manage time well since it is so scarce. –  If a key player is missing consider rescheduling; rather than having the same meeting twice. –  Bring who you need to meeting but not more then you need •  “Start on-time/finish on-time” is a cultural thing –  You will set the example and lead culture – You get what you demonstrate and tolerate. –  No golden rule, but avoid mixed messages. •  Informal (break and meal) times are often highly productive –  Frequently seen to be more valuable than the formal portion – Don’t skip these –  Especially when bringing multi-site people together –  For off-site meetings to pay; you need to keep people together off-hours to extract the value •  Get in the habit of documenting –  Purpose, Participants, Agreements and Actions –  Blog, Wiki probably better than email –  You can then see if you are getting value, –  And if you are following through Slide 35 Lead to Win
  • 36. Meetings - A Team Model (Projects) •  Core Team: •  this is the project team accountable for the Listeners deliverables •  the team sets it’s objectives and plans •  members are on the team for the project duration Subject Matter and commit to be at all team sessions Experts •  should identify a set of Subject Mater Experts , or Interested Presenters for info/skills required Core •  Subject Matter Experts, Invited Presenters: Team •  are prepared to provide info or give team detailed technical guidance Invited •  are not required to be at team meetings unless Presenters needed by core team •  are able to use their time in team interaction more effectively The •  Listeners: Curious •  people with applicable interest in the outcome of the team •  may be on distribution for all team minutes •  can send info to team or give feedback Slide 36 Lead to Win
  • 37. Agenda •  The Team •  Steering the Ship •  Selling Related Finger Food •  Money Related Fun •  Burnt Flesh Potpourri Slide 37 Lead to Win
  • 38. Don’t Let People See the Dog •  PowerPoint template – fonts, colors, format •  Email signature •  Logo variants allowed – on dark or light background, with tagline and without •  Letterhead template •  Business cards template and common vendor to produce •  Brochure template •  Establish basic common collateral set: company /product awards, corporate overview, product overview, etc •  Domain name and standard email naming convention, e.g. fname.lname@bigcompany.com –  Don’t use personal email addresses for business purposes! •  Professional website – even if only one slick -looking page •  Use a professional to polish important presentation slide sets, e.g. www.bittnerdesigns.com Slide 38 Lead to Win
  • 39. Sales Management Basics •  Define: –  Sales plan – target customers and characteristics –  Sales process – steps from qualification to close –  Sales pipeline – estimate volume at each sales step, ratios don’t lie –  Sales targets – quarterly, core element of business plan –  CRM tool – Salesforce, SugarCRM, etc •  Staff to ratios as necessary to meet your sales targets •  Hire appropriate to your stage and your sales model –  Not all “sales” roles are the same (e.g. hardware/software) and include roles such as: Business Development, Channel/Partner Development, Sales, Inside Sales, Marketing, Technical Sales Engineer, Product Manager •  Establish compensation plan based on need/phase –  First sale? Volume? Margin? New Market Penetration? •  Weekly sales team reviews –  Review from CRM tool – make it the bible –  Look at what isn’t working – adjust, adjust, adjust –  Replace sales staff that are not a good fit or are not delivering Slide 39 Lead to Win
  • 40. Lead to Win Example 2009 Pipeline Pipeline Stages Unique Launch a Application Application Application Complete Website new Downloaded Submitted Accepted Phase 2 Visitor Business Conversion % From One Stage to the Next 100% 3% 12% 80% 84% 50% Numbers for LTW To Generate 1 New Business 900 27 3.24 2.59 2.17 1.08 Slide 40 Lead to Win
  • 41. Tip: Not all Customers make good Leads 3 types of pre-sales “customer encounters” Customer Leads not same as Lead Customers 1. Baiting the Hook • Must differentiate amongst the three to –  Generate awareness, interest, pull use finite resources/time wisely. –  Demo, Trade Show, Press, Partner or channel • Early wins are about relationships recommendation –Must manage to a small number of 2. Product validation simultaneous trials - staggered –  Get your product right windows; make each one “feel” –  Alpha Trial, Beta Trial, pre-GA soak special. 3. Customer acceptance • Managing expectations is just as –  Generate revenue important as managing deliverables. –  Lab Trial (CAT), Bake Off • Validate before you scale up. • In ramp – methods change – Can’t make each customer feel special. You may blow your brains out if you try to do validation with #3 (Early adopters are a different breed) Slide 41 Lead to Win
  • 42. Calling on Customers - Tips Treat EA’s •  Respect the customary dress codes with great –  Business attire as appropriate to the locale respect – •  Manhattan, TO Financial District – Suit & Tie (gents) They can •  Pressed shirt, Belt literally open •  Silicon Valley – No tie; Golf shirt; jacket probably or close –  When was the last time those shoes were polished? doors –  Personal grooming is important – Haircut, Shave… •  Take an extra shirt –  Coffee spills happen at the worst times! •  Be on time –  Traffic sucks in big cities (even if you know they way) –  I usually skip hotel breakfast; get to the client’s building early and eat nearby –  If so, take toothbrush and/or mouthwash to freshen up before meeting •  An umbrella can be a life saver Slide 42 Lead to Win
  • 43. Contain Feature Creep Resist the urge to add in “features” before the core product works. - Graphic - – Peter Evans (Riverdale Partners) Slide 43 Lead to Win
  • 44. Agenda •  The Team •  Steering the Ship •  Selling Related Finger Food •  Money Related Fun •  Burnt Flesh Potpourri Slide 44 Lead to Win
  • 45. Money Related Fun Stuff •  Managing Cash •  Managing Cost •  Managing Equity Slide 45 Lead to Win
  • 46. Budgeting and Cash Management Airplanes How Any Firm Fails: Run out of Money crash when Starting altitude they run out + rate of climb x time Dollars (& credit) on hand + Money IN of altitude - rate of descent x time - Money OUT --------------------- prematurely. must be > 0 to survive (unless you --------------------- must be > $ 0 to survive are over a runway.) Cash is your altitude! EVEN IF THE PLANE IS PERFECT! NO MATTER HOW GOOD THE IDEA! •  Someone in the firm MUST be responsible for managing cash flow –  Monthly projection of what is coming in / going out –  Accounting package or spreadsheet is fine –  Closer management when the cash is getting low –  Keep track of all liabilities –  Always remit your payroll taxes! Slide 46 Lead to Win
  • 47. Watch Cash Outflow & the Bottom Line Are you tracking to plan? Getting better or worse? Net Cash Flow •  Early detection creates more opportunity to work the issues. Slide 47 Lead to Win
  • 48. Group Benefit Plans •  Your company can buy coverage similar to big firms –  Dental, Vision care, Prescription and Hospital •  Typically need 6 members or more –  Varies by supplier •  Small groups will likely need medical evidence for each participant –  Histories –  Medical tests •  Suppliers: Insurance brokers or Canada’s large Insurance companies •  Beware: US coverage can be VERY expensive •  Initial US coverage options: –  Use COBRA and pay their benefits cost –  Pay a monthly supplemental benefit for them to use for a private plan (which goes away when company plan is in place written in as part of employment contract) •  Possible to put in place self coverage –  But make sure it is capped (unlimited exposure would be bad!) –  Understand administration effort required Slide 48 Lead to Win
  • 49. Travel Cost Tips (Small team) •  Even as a small team, you can manage your travel costs well Always a –  Plan ahead; arrange multiple visits on each trip balance of –  Visit your local travel agents – find one who wants your business time vs. and book through them; Saves you time money – –  Leverage your client’s corporate rates/travel agent Don’t waste –  Negotiate with hotels; Ask for the day manager; Visit while on other trips. Even on a few trips this can make a difference $100/hr time –  www.priceline.com plus BetterBidding.com (see for something www.mahalo.com/how-to-successfully-bid-on-travel) that can be –  Flights: www.flightnetwork.com (Canada) www.webflyer.com done for $10/ –  Hotel FFPs – Save on food, internet, phone hr –  IP Phone or Skype work well in many locations –  Beware cell-phone plan roaming charges; hotel LD charges •  You can go too far! –  Safety is important –  Location is important –  Cleanliness is important Slide 49 Lead to Win
  • 50. Travel Cost Tips (Large team) Control •  Travel approval process – control, control, control – what, who, why – do you really need 2 people at the same Process conference? Mandate •  Travel and expense policy – limits, expectations on what is considered allowable/reimbursable, rentals, hotel rates, meals, sundry, entertainment, economy/biz class, etc •  Designate one person who is authorized to book and manage all authorized travel arrangements – consistency, speed, expertise, accountability -- $10/hour versus $100/hour labor •  Traveling to same location repeatedly (or having staff come to main office repeatedly) – negotiate a special rate at a hotel and mandate its use, rent an apartment •  Use corporate credit cards – tracking, simplify expensing, make it easier for employees Slide 50 Lead to Win
  • 51. Avoid Costs (time, goods, legal) Due to Theft •  Locked filing cabinets •  Locked management offices •  Locked, controlled access to labs •  Controlled access to labs •  IT staff access to files/systems •  IT security (control of root/admin passwords), password logs •  Document shredding, e.g. ShredIt •  Employee badges and electronic access •  Sign-in of guests •  High value asset control and security, e.g. processor chip vault, laptops •  Desktop security, e.g. locks, passwords •  Laptop policy, e.g. lockup in desk afterhours, locked to desk during day •  IT security, e.g. WiFi WPA security, SSL VPN, Firewall •  After-hour access •  Backup of all desktop, laptop, server data, e.g. incremental and off-site storage/rotation of backups Slide 51 Lead to Win
  • 52. Costs – Tips for other than travel •  Space –  Sublet from someone who has downsized –  Share with others –  Beware the long term lease commitment! Fixed costs can be deadly •  Capital Equipment –  Borrow from someone who has it –  Buy used (eBay, Kajiji, Craigs list, your peer network …) –  Auctions (Going out of business sales) –  Bank lease to cover •  Your banker can help with these (secured credit easier to get, but likely will not finance the full value of the asset) Slide 52 Lead to Win
  • 53. Maintaining Shareholder Records •  Your corporate lawyer may be a good place to keep your minute book •  They may also have facilities to securely store founders stock certificates so they never get lost – ask. –  It can be a major issue if those stock certificates get lost –  They may be needed for surrender to close certain exit deals •  They or you will need to maintain a Shareholder’s Register: –  Simple 5 column spreadsheet –  Who owns what Date of Issue Name Address Shares Class April 1, 2009 John Smith 1 Endless Loop, Cupertino, 1000 Class A Common CA, USA Slide 53 Lead to Win
  • 54. Cap Table – Example (pre Series-A) $100,000 = $0.20/share Private investor 500,000 negotiates to buy 12.5% of company Post-money Valuation 4,000,000 x $0.20 = $800,000 Contributed Capital ($100,000) for $100,000 Pre-money Valuation $700,000 Slide 54 Lead to Win
  • 55. Cap Table – Example (post Series-A) VC negotiates to invest $4M pre + $4M new = $8M post $4M, and “gives” you a $8,000,000 An Up Round  pre-money value of $4M 10,000,000 = $0.80/share Post-money Valuation 10,000,000 x $0.80 = $8,000,000 - But you must top up Contributed Capital ($4,000,000) option pool to 15% first Pre-money Valuation $4,000,000 Slide 55 Lead to Win
  • 56. Cap Table – Example (post Series-A) VC negotiates to invest $4M pre + $4Mthe added ESOP Dilution! Must factor in new = $8M post $4M, and “gives” you a pre-money value of $4M $4,000,000 $8,000,000 = $0.67/share 6,000,000 = $0.80/share An Up Round An Up Round  10,000,000 Post-money Valuation 10,000,000 $0.80 $8,000,000 11,175,000 x $0.67 = $7,450,000 - But you must top up Contributed Capital ($4,000,000) option pool to 15% first Pre-money Valuation $4,000,000 $3,450,000 Slide 56 Lead to Win
  • 57. Cap Table – Impact of Dilution & Valuation •  In this example: –  Founders holdings more than doubled (grew by $1.4M) –  Your Angel did not get crammed down (it was an up-round), but they did not participate pro-rata on the follow on –  The VCs used the Option Pool trick to give you a seemingly higher pre money value –  You lost control – you are now an employee, and the VC’s have enough options to incent/recruit your replacement Slide 57 Lead to Win
  • 58. Ways to Use Stock Options •  Attracting Talent –  Sharing in success / upside –  Negotiation flexibility •  Retaining Talent –  Key employees •  Incentives to Drive Results –  Give bonus options on completion of a milestone –  Can be partially vested upon award •  Cash Conservation –  Give more options, less cash Slide 58 Lead to Win
  • 59. Agenda •  The Team •  Steering the Ship •  Selling Related Finger Food •  Money Related Fun •  Burnt Flesh Potpourri Slide 59 Lead to Win
  • 60. Potpourri - Definition 1.  A combination of incongruous things 2.  A miscellaneous anthology or collection 3.  A mixture of dried flower petals and spices used to scent the air Slide 60 Lead to Win
  • 61. Know Your Personal Risk Tolerance •  As an entrepreneur – know your risk tolerance •  Look at the worst possible outcome scenario for you personally – financial loss, lost reputation, lost opportunity, etc •  Can you live with the worst possible outcome? •  If not – stop now Slide 61 Lead to Win
  • 62. You Need Support •  Launching a new business is – hard work, long hours, stressful, can take you away from home for long periods of time, reduces your earnings at the front-end, can deplete your savings, … •  Ensure you have the support of your spouse and family Slide 62 Lead to Win
  • 63. Multi-site operations for young companies Essentials •  Access to mail •  Files –  Gmail; imap; hosted exchange; Webmail via your ISP •  Email •  Access to Calendar –  Gmail; hosted exchange; Plaxo; Tungle •  Voice •  Contacts Database •  Schedule –  Gmail; hosted exchange; Plaxo; Linked-in •  Voice/Voicemail Make sure –  SIP (BYOD); Primus; Vonage; Skype; Good cell plan your •  All data must be secure repository is –  SSH, VPN access to home office; between offices –  Laptops should always have encrypted storage; and cable locks (in office backed up and on the road) –  Never trust a computer you don’t know – Assume it is compromised Keep all •  Centralized document repository needed –  SharePoint; Hosted server; Yahoo Groups; Google Docs (ITutility.net is a templates local player) there! –  Multiple people in groups need to collaborate – so authentication and security controls are essential Slide 63 Lead to Win
  • 64. Company Knowledge is Gold •  Knowledge is core to any business – product, design, customer relationship contact information, market research, HR information, marketing collateral, financial planning information, etc •  Must be centralized not distributed in an adhoc manner or held in people’s heads or held on people’s laptops or on scraps of paper… •  Uniform access to knowledge multiplies the team’s effectiveness •  Need to protect against people hoarding knowledge -- what happens if they leave or are terminated? •  Setup as appropriate CMS, file repository, CRM, ERP •  Enforce and audit usage •  Ensure backed-up •  Ensure secure Slide 64 Lead to Win
  • 65. Live IT-free •  Avoid internal IT infrastructure (e.g. servers, internal applications) •  All basic business functionalities are available as an online service •  Cheaper then doing it yourself, e.g. hosted exchange, hosted SharePoint, hosted QuickBooks, hosted SVN, hosted CRM •  Less staff, less staff playing with IT, more functionality for less cost, backups handled automatically, available anywhere, pay as you grow, enforces a company standard Slide 65 Lead to Win
  • 66. NDA Practical Perspective •  Use to protect your ability to patent IP •  Have a standard set of papers •  Clear process on who signs and authorizes changes •  One person responsible to receive /confirm and file the signed agreements •  Assume everything you say or share will eventually end up with a competitor Slide 66 Lead to Win
  • 67. Legal - Read the Fine Print on all Documents The big print often draws your attention from the truly important messages Slide 67 Lead to Win
  • 68. Cheques & Fraud Prevention •  Authorizing outgoing cheques –  Good practice is to have 2 authorized persons sign cheques above a specified dollar amount; Some organizations require two for all –  Sign as “Authorized Agent” or “Authorized…” – not personally –  NEVER pre-sign cheques •  I shouldn’t have to tell you this, but I’ve seen it done! •  Endorsing received cheques (yes Virginia – This is why we Invoice) –  Rather than have an authorized person sign them – have the person who receives mail – STAMP them “For Deposit Only”. –  They may ONLY be deposited in the Company bank accounts. Slide 68 Lead to Win
  • 69. Pay Attention to Your Signature Line •  You will sign lots and lots of documents running your business •  Only authorized officers can bind the company into contracts •  Pay attention to the signature line – Exactly on who’s behalf are you signing (“as”, “for” or “per”) –  Make certain your company name is complete and correct –  Ltd. Limited Inc. ,Inc. Corporation Corp. are not the same •  At law, if you sign on behalf or a company that does not legally exist, you may be personally undertaking the liability MYCORP, INC. THE SMITH FAMILY TRUST Per: Per: ________________ ________________ John Smith John Smith Authorized Trustee MyCorp President Slide 69 Lead to Win
  • 70. Sh*t happens – Get over it! If something has been done wrong – Don’t fret; Just fix it! Don’t compound problems. Learn from mistakes. Slide 70 Lead to Win
  • 71. Learning from the Past Those who •  Hold “Good/Bad/Ugly” working sessions after each don’t learn major milestone – product, sales, financing, etc from history •  Typical meeting flow: are doomed –  Brainstorm using sticky notes – Good, Bad, Ugly to repeat it. –  No ass-covering – open, honest, non-rationalizing –  Group sticky notes into “like” –  Rank the groups in each category •  Embrace and celebrate the Good •  Reflect back on the top Bad and Ugly items –  Why, how could have been avoided or mitigated, etc •  Reflect forward/brainstorm on what to do differently •  Develop forward looking actions Slide 71 Lead to Win
  • 72. Perseverance is Critical to Success OPTIMISM WEEKS OR MONTHS The Dark Night of PESSIMISM the Innovator UP TO TWO YEARS Slide 72 Lead to Win
  • 73. Exercise Roundtable discussion Topics of 11:00 - breakout meetings interest 11:30 - breakout presentations back to group (10 minutes each) 12:00 - breakout presentations done Group discussion Sound off! 1, 2, 3, 1, 2, 3, … you get the idea? BREAK OUT GROUPS 1.  Cash Conservation –  What can you do to save cash –  What non-cash assets do you have and how can you leverage them 2.  Survival Game –  Linear phases of start-up company growth –  Of topics and suggestions presented - what is most important and at what phase and why 3.  Time Management Tips –  Discuss and prepare a presentation back to the group on your best time management tips –  What are the top time management mistakes you have made and why? Slide 73 Lead to Win
  • 74. Wrap •  The walrus having drunk too long from the fire hose… took a much needed break. Good luck – And Thank-you Slide 74 Lead to Win
  • 75. Effective Executives Acquire •  Ask “what needs to be done?” knowledge they •  Ask “what is right for the organization?” need •  Focus on opportunities rather than problems Convert •  Develop action plans knowledge into •  Take responsibility for their decisions effective action •  Take responsibility for communicating Make the entire organization feel •  Ran productive meetings responsible and •  Always use “we” and not “I” accountable Slide 75 Lead to Win
  • 76. Build and operate effective Boards Upon completion, you will know about: •  what entrepreneurs and investors want from Boards •  gaps in Board memberships And you will be able to: •  select Board members •  define Board responsibilities •  help Board operate effectively Lead to Win
  • 77. Entrepreneurs want Boards to: •  Help obtain key resources (e.g., capital, information, partnerships, customers) •  Provide services (e.g., legal, mentoring, expertise) •  Guide changes in business strategy and respond to opportunities and crises •  Promote the company’s reputation Lead to Win
  • 78. Institutional investors want Boards to: •  Monitor executive behaviour, performance and compensation •  Select, control and replace the CEO •  Be independent from management •  Act in the interest of shareholders •  Guide changes in business strategy and respond to opportunities and crises •  Guard against infringements of the law Lead to Win
  • 79. Board emphases •  What Boards emphasize depends on: –  Company’s stage of development –  Number of outside vs inside directors •  Early stage Boards emphasize resource acquisition and services •  Mature stage Boards emphasize executive performance, legal issues and community impact •  Outside directors emphasize reviewing executive performance, employees and community •  Inside directors emphasize shareholders concerns Lead to Win
  • 80. Build an effective Board •  Select members who the CEO views as peers and have the time •  Each member must bring at least one competency •  Board as a whole must have knowledge of all important issues and major stakeholders •  Board members must be able to work together •  Significant proportion must be independent and not subordinate to CEO Lead to Win
  • 81. Build an effective Board Select members who: •  CEO views as peers •  have the time •  bring at least one competency Ensure Board: •  has knowledge of all important issues and major stakeholders •  is able to work together as a team •  has a significant proportion of independent members Lead to Win
  • 82. Define Board responsibilities around •  Development of detailed strategies that produce large amounts of pixie dust •  Development and evaluation of strategy implementations •  Development and evaluation of CEO and senior management team •  Management of crises •  Monitoring legal and ethical performance of executives and company Lead to Win
  • 83. Operate Board effectively •  Define Board responsibilities •  Bring Board members up to a minimum level of knowledge concerning key issues they may face •  Welcome constructive feedback •  Have Board decide how it will work as a team in time of crisis •  Have Board members interact with customers, employees and suppliers •  Provide information that is accurate and timely in a clear way •  Provide information from multiple data sources •  Provide scoreboards that measure company performance in the eyes of different stakeholders •  Define a process for employees to contact Board about illegal or unethical practices •  Review development plans and appraisals for key executives •  Motivate Board members through recognition and money •  Schedule enough time to examine facts and make decisions Lead to Win

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