Steve Blank has one message for startup founders - Get out of the building
So what happens when founders go out of the building and have to do sales with no previous experience? This is what happened to me. I had no experience of how large companies work.
Here are a few lessons I picked up from my experience of selling to large companies.
1. Network - There is only one way to break into large companies independently, that is via your contacts and network. Go back to your alumni association, your family, your school and college buddies. Start working on your networking skills. Networking is all about first finding a common interest (say Open Source or you went to the same school) with someone and then getting to personally know them - their family, interests, goals etc.
2. Find the right audience - If you are selling a business product, find business users who may benefit from the solution, if you are selling a technical product, go to the technical users. If you are not sure, go to the business users - they are likely to find a use for your product.
3. Be patient and consistent - Large companies are usually bureaucratic and paranoid about startups. But even within large enterprises there are early adopters. Once you get someone interested in your service, keep them in the loop. Remember if someone takes interest in you, they will give you a pilot or refer you to someone
4. Dress and present well - Large companies are used to smart (power) dressing and glitzy presentations. Make a good presentation, polish your shoes, wear neat formal clothes and talk confidently and clearly. Be prepared to flash a knowing smile as often as you can. Everyone likes people who look and behave like them. So try and mirror your contact.
5. Blend in the culture of the company - This may be difficult if you are not too experienced, but try and look for signs. Are your prospects specific or vague? Do they act important or humble? Are they paranoid or risk-taking? Are they formal or casual? Tailor your pitch accordingly and try to fit into their culture.
6. Communicate and be serious about commitments - Once your foot is in the door, keep your contact in loop. Startups usually fail to grasp or estimate the true costs of executing a project. So it is best to under-promise and over-deliver. If you think you are going to run over deadlines, keep communicating. By communicating, you will get valuable feedback about how your project / pilot is progressing and if you need to make any changes to your solution or approach.
If all this is not for you, then you do not have the temperament to do large company sales... like me :-) All of this is usually time consuming and expensive. This is why enterprise products are so expensive!
Monday, September 27, 2010
Saturday, September 25, 2010
Finding the ideal team structure for Startups
A lot of what is written about managing teams is a discussion of the two basic classes of teams, centralized and decentralized teams. Both have their pros and cons and are best suited to different situations.
Centralized teams also give rise to a top-down structure of an organization. Top down teams can get a lot of work done as all members work in tandem. Independent and creative thinking can jeopardize the entire organization. The scope of work is divided into two classes, thinkers and doers. Thinkers do medium/long range planning, anticipate issues, allocate resources, manage motivation and doers execute the activities that the thinkers have identified on a transaction basis. Centralized teams are usually stable and provide security to all its members. Large companies and governments usually fall into this category.
De-centralized teams on the other hand are much more fluid and depend on creative and independent thinking members. These teams are usually upstarts and their objective is to find a niche that has not been exploited by others. Every member is a thinker and doer. The tasks are not stable and the position of each member is not secure if they are not willing to change their roles or learn new skills.
Truly decentralized teams are a much more rear phenomenon in business than centralized teams. Hence most people would have never experienced working in decentralized teams or even heard of anyone who worked in one. This also includes founders of start-up companies
A one to three person start-up does not face this problem, but when a start-up takes more risk than usual, the centralization / decentralization problem comes up. This is because most people have no experience / understanding of de-centralized way of working. As Steve Blank rightly points out, a start-up is a "search" for a scalable business model and hence what it requires is a de-centralized team. This is exactly what Jason Fried and company write about in "Rework"
Or the other option is to become ambidextrous. Be centralized and de-centralized at the same time. Let the need drive the structure. Say if you need to do extensive testing before a new feature release, make a centralized team and split planning and doing. If you need to build 10 new features in a month, keep it de-centralized. The catch here is that all the team members also have to be ambidextrous.
Centralized teams also give rise to a top-down structure of an organization. Top down teams can get a lot of work done as all members work in tandem. Independent and creative thinking can jeopardize the entire organization. The scope of work is divided into two classes, thinkers and doers. Thinkers do medium/long range planning, anticipate issues, allocate resources, manage motivation and doers execute the activities that the thinkers have identified on a transaction basis. Centralized teams are usually stable and provide security to all its members. Large companies and governments usually fall into this category.
De-centralized teams on the other hand are much more fluid and depend on creative and independent thinking members. These teams are usually upstarts and their objective is to find a niche that has not been exploited by others. Every member is a thinker and doer. The tasks are not stable and the position of each member is not secure if they are not willing to change their roles or learn new skills.
Truly decentralized teams are a much more rear phenomenon in business than centralized teams. Hence most people would have never experienced working in decentralized teams or even heard of anyone who worked in one. This also includes founders of start-up companies
A one to three person start-up does not face this problem, but when a start-up takes more risk than usual, the centralization / decentralization problem comes up. This is because most people have no experience / understanding of de-centralized way of working. As Steve Blank rightly points out, a start-up is a "search" for a scalable business model and hence what it requires is a de-centralized team. This is exactly what Jason Fried and company write about in "Rework"
Or the other option is to become ambidextrous. Be centralized and de-centralized at the same time. Let the need drive the structure. Say if you need to do extensive testing before a new feature release, make a centralized team and split planning and doing. If you need to build 10 new features in a month, keep it de-centralized. The catch here is that all the team members also have to be ambidextrous.
Saturday, September 11, 2010
Frugal Engineering: Jugaad is the new Kaizen
The rise of Japanese manufacturing in the 80s gave rise to "Lean Manufacturing". Lean is based on core values that are a part of the Japanese culture of minimalism, automation and elimination of waste. As Industrial Engineers, we even learned these concepts with their Japanese terms like "Kaizen" (continuous improvement), "Jidoka" (automation), "Poka-yoke" (full-proof) in school. Using the Japanese versions of these terms forces us to create a new meaning to the concepts keeping with the spirit in which the Japanese companies applied.
With the turn of the century, the recession and the rise of Indian companies in the eyes of the world, a new paradigm shift is just beginning to take place, "Frugal Engineering". C.K. Prahlad's book "Bottom of the Pyramid", Tata Motors new $2500 car the "Nano" and Bharti Airtel's telecom business model are the main stories around this new concept of Frugal Engineering. With billions of people from developing countries around the world, joining the "mainstream" market, companies need new thinking on how to succeed with this big opportunity.
A new management jargon that is heard often these days is the Indian word "Jugaad" (to get a solution where there is a scarcity of resources). As with the Japanese terms, it is the spirit in which it is spoken in India that makes it unique. When you want to do a Jugaad, you look for an out-of-the-box solution using existing cheap resources and you want it quick
So if "Frugal Engineering" gets popular like "Lean" and managements around the world start looking for ideas on how to cater to developing countries, like Jugaad, what are the core cultural elements of Indian companies that will be talked about? Here is a proposal:
1. Cutting (micro-consumption): The concept of "Cutting" is you provide in the minimum possible serving size. Cutting is used in relating to tea, where a "Cutting" tea is half-a cup of tea, roughly 50ml. Huge majority of tea drunk in Mumbai is Cutting tea. The majority of mobile phone re-charges (in India most mobile-connections are pre-paid, i.e. you pay first and use later) are for Rs 10 (20 cent). What Cutting does is that it allows for mass consumption of a service or product at very low costs. Cutting is micro-consumption to services like micro-finance is to banking.
2. Zor-laga-kay (the-push): When there is a big problem that needs to be fixed quickly, a large number of people stop whatever they are doing put in effort to solve it. In India more people are likely to be a Jack-of-all-trades rather than specialists. Indian companies are also more chaotic where it is hard to put people into fixed roles and functions. There are obvious down-sides to this, but the upside is that when there is a major problem that threatens survival, everyone contributes. The team self-organizes itself around the problem and everyone puts in synchronized effort to "push" the problem out. A new team spirit and confidence emerges and seemingly impossible tasks get accomplished with Zor-laga-kay.
3. Chalta-hai (take-it-easy): This term is usually used by high-minded Indians as a self-critical symbol of laziness, fatalism and poor quality. But if taken in the right spirit, this concept has a great balancing and harmonizing effect. Indians are more likely to make a compromise rather than pick a fight. In my opinion, the west is too result oriented and sometimes forgets that the journey is as important as the destination. As you enter the developing world, the problems are plenty, your resources are limited, and most things are not in your control. So be prepared to suck it in, calm your mind and say "Chalta-hai".
4. Fat-a-fat (instantly): This means, what ever you want to do, do it NOW. Don't think too much, use your instinct and move on. Sometimes in the West, a lot of resources are used to strategize and plan. The Fat-a-fat principle says, that you don't have much resources or time to plan so just get on with it. Fat-a-fat brings a sense of urgency in an otherwise slack environment. In developing countries, things often seem to move very slowly, with people taking their own sweet time to get things done. Like Narayana Murthy of Infosys said "In India articulation is often mistaken for accomplishment". So if you are feeling interia, just do it - Fat-a-fat.
So next time, hear these words as management jargon, remember where your read them first. And I am sure you would have many suggestions, please write them in the comments!
Note 1: These are terms that are usually spoken in Hindi in Mumbai, every region of India is unique and has their own terms. But I am sure the spirit and culture is very similar.
With the turn of the century, the recession and the rise of Indian companies in the eyes of the world, a new paradigm shift is just beginning to take place, "Frugal Engineering". C.K. Prahlad's book "Bottom of the Pyramid", Tata Motors new $2500 car the "Nano" and Bharti Airtel's telecom business model are the main stories around this new concept of Frugal Engineering. With billions of people from developing countries around the world, joining the "mainstream" market, companies need new thinking on how to succeed with this big opportunity.
A new management jargon that is heard often these days is the Indian word "Jugaad" (to get a solution where there is a scarcity of resources). As with the Japanese terms, it is the spirit in which it is spoken in India that makes it unique. When you want to do a Jugaad, you look for an out-of-the-box solution using existing cheap resources and you want it quick
So if "Frugal Engineering" gets popular like "Lean" and managements around the world start looking for ideas on how to cater to developing countries, like Jugaad, what are the core cultural elements of Indian companies that will be talked about? Here is a proposal:
1. Cutting (micro-consumption): The concept of "Cutting" is you provide in the minimum possible serving size. Cutting is used in relating to tea, where a "Cutting" tea is half-a cup of tea, roughly 50ml. Huge majority of tea drunk in Mumbai is Cutting tea. The majority of mobile phone re-charges (in India most mobile-connections are pre-paid, i.e. you pay first and use later) are for Rs 10 (20 cent). What Cutting does is that it allows for mass consumption of a service or product at very low costs. Cutting is micro-consumption to services like micro-finance is to banking.
2. Zor-laga-kay (the-push): When there is a big problem that needs to be fixed quickly, a large number of people stop whatever they are doing put in effort to solve it. In India more people are likely to be a Jack-of-all-trades rather than specialists. Indian companies are also more chaotic where it is hard to put people into fixed roles and functions. There are obvious down-sides to this, but the upside is that when there is a major problem that threatens survival, everyone contributes. The team self-organizes itself around the problem and everyone puts in synchronized effort to "push" the problem out. A new team spirit and confidence emerges and seemingly impossible tasks get accomplished with Zor-laga-kay.
3. Chalta-hai (take-it-easy): This term is usually used by high-minded Indians as a self-critical symbol of laziness, fatalism and poor quality. But if taken in the right spirit, this concept has a great balancing and harmonizing effect. Indians are more likely to make a compromise rather than pick a fight. In my opinion, the west is too result oriented and sometimes forgets that the journey is as important as the destination. As you enter the developing world, the problems are plenty, your resources are limited, and most things are not in your control. So be prepared to suck it in, calm your mind and say "Chalta-hai".
4. Fat-a-fat (instantly): This means, what ever you want to do, do it NOW. Don't think too much, use your instinct and move on. Sometimes in the West, a lot of resources are used to strategize and plan. The Fat-a-fat principle says, that you don't have much resources or time to plan so just get on with it. Fat-a-fat brings a sense of urgency in an otherwise slack environment. In developing countries, things often seem to move very slowly, with people taking their own sweet time to get things done. Like Narayana Murthy of Infosys said "In India articulation is often mistaken for accomplishment". So if you are feeling interia, just do it - Fat-a-fat.
So next time, hear these words as management jargon, remember where your read them first. And I am sure you would have many suggestions, please write them in the comments!
Note 1: These are terms that are usually spoken in Hindi in Mumbai, every region of India is unique and has their own terms. But I am sure the spirit and culture is very similar.
Subscribe to:
Posts (Atom)