Category: Team

The Skill of Listening

One of my favorite fantasy series is the Alex Verus novels by Benedict Jacka. There are a variety of reasons why, but one of the interesting dynamics in the novel is that the main character, Alex, is continually outclassed. He operates in a world of magic users who can shoot fireballs and have other similarly fantastic powers. His only magical ability is that he can see a few seconds into the future. Other than that, he’s an ordinary human. However, he leverages his insignificant advantage again and again to overcome more formidable opponents.

The equivalent in business is listening.

Being able to understand where people are coming from and what they want doesn’t seem significant. But we all connect through the imperfect veil of communication, where our intent is eroded by how well we articulate our thoughts and how well the other party listens.

Business is inherently interpersonal. Whether it’s writing a landing page, selling a product, or dealing with a problem employee, your success is magnified or minimized by how well you understand the other person.

It pays to slow down and really try to understand.

The Two Approaches

There’s a way of running a business that is entirely system based. Every challenge is resolved through structure.

If you’re not making enough profit, you apply a financial framework. If you have interpersonal conflict between team members, you apply a six-step algorithm. If a team is under-performing, you apply an improvement plan.

This systematic approach to business is highly effective.

However, there’s another way of running a business where the solution to every challenge isn’t a system. It’s a way of operating where people solve some of the problems. It encourages initiative and innovation and is risk tolerant.

The first approach is management. The second is leadership.

To grow to any level of scale, management is required. To realize the highest potential of your business, leadership is required.

You don’t have to be a leader to be successful. It’s not the key ingredient. But it is the secret sauce to making things easier and having a greater impact.

A More Useful Perspective on the Peter Principle

There’s a concept called, “The Peter Principle,” that is often used to describe the reason for someone’s lack of success. From Wikipedia:

“The Peter principle is a concept in management developed by Laurence J. Peter which observes that people in a hierarchy tend to rise to ‘a level of respective incompetence’: employees are promoted based on their success in previous jobs until they reach a level at which they are no longer competent, as skills in one job do not necessarily translate to another.”


The shorthand is that people rise to the level of their incompetence. It’s used to ascribe reason to the limit of someone’s accomplishment.

A less cynical way to think about it though, is that people rise to the level with which they have the opportunity to grow. Or that people navigate their course until they meet an obstacle which requires growth.

Last week, I asked our team to take on a project that they had never done before, but that I know we have the capability to do. They hemmed and hawed, expressed doubt, and confusion, and looked to me to provide the path forward. They wanted a leader to layout a plan for them.

But I didn’t take on that role. Instead, I gave them space and a little coaching so that they could develop the plan themselves. On Monday, they were stuck. A week later, they’re making progress.

Initially, they hit that Peter Principle limit. Then they started to develop the skills needed to form their own plan. Eventually, they’ll become adept enough that this sort of situation will no longer be an obstacle and then we’ll discover what the next opportunity for growth is.

Gaming the Process

I’ve been doing transcendental mediation (TM) for the past month and a half. My mom bought the TM training for me as a birthday gift to help improve my sleep. I didn’t think that I would stick with it because meditating isn’t a personal goal and it’s a big ask of my time. I meditate forty minutes everyday- twenty minutes in the morning, twenty minutes in the afternoon. Because it was a gift I decided to give it a sincere effort and evaluate whether to continue it at some future point.

It has surprised me that I’ve kept with it. I have personal discipline in spades, but any ongoing activity has to be really rewarding for me to be willing to add it to the other  time-intensive tasks I do on a daily basis (lifting and writing). TM varies a little in its effects, but in general, it has improved my energy level. Beyond this benefit, what has made it easy to maintain is the training provided as part of TM. Specifically, the way you’re taught to self-evaluate meditation.

When you’re taught TM, they teach you to evaluate your meditation not on how you feel during meditation or whether you have thoughts or not, but on certain signals to watch for:

  • Did the mantra change?
  • Did you lose track of time?
  • Did your breathing get soft and slow?

This meta-evaluation directs attention towards the process instead of the outcome. It’s a winnable, controllable game because if you follow the TM instruction these signals will occur.

Similarly, I’m studying business operating systems and EOS has a similar mechanism. In EOS, they give you six categories of the operating system and ask you to self-evaluate your implementation of those categories on a regular basis. Rather than focusing on whether EOS is impacting profit, instead you’re attention is directed to how much of the system you have implemented with a goal of 80% criteria being met.

Tracking KPI’s in your business has a similar effect. The right KPI’s should create a game that focuses you and your team on activities that lead to good outcomes rather than on the current outcomes.

What are the signals that you’re engaging with the market in a way that supports your goals?

Values & Competitive Strength

Last Thursday, I attended a coaching session for Entrepreneurs Organization (EO) PDX as part of their accelerator program. The coach of my cohort is the founder of a popular business here in Portland, Olympia Provisions. Outside the conference room we met in, there was a poster on the wall that said, “Obsessed with Quality,” with a short blurb beneath it. This is one of the company’s core values.

The past couple of weeks, I’ve been working on a proposal for a large project. In that proposal, I both listed our core values and referenced them at various points throughout the proposal.

On Sunday, I received a group email that was laced with profanity from a member of the Toastmaster’s club, where I’m the president, to the rest of the members. It didn’t offend me, but it would offend most people and by Monday morning I received an email from another member concerned about the health of the club.

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CMO’s for Small Businesses

I had drinks last night with some agency owner friends. One of them has built their business to the point where they’re on the cusp of early retirement. One of the last hurdles is to replace themselves as the chief marketing officer for the business.

“I want to hire someone better than I am at marketing and have them build out additional channels to augment what we already have,” he told us around a fire pit.

This should be possible. There are people that are better than my friend at marketing and it’s likely that there are additional marketing strategies that would work for his business.

In practice though, it’s a challenge to achieve. There are many people that can execute tasks: build out a social media campaign, optimize a site for SEO, and etc. However, there are few that can innovate and build something new.

If you’re getting leads from organic social media, you can probably hire someone better than you to ramp it up. But it’s a much tougher proposition to say, “We need more leads. Build a new channel of customers.”

There are people who can do it, but they’re often running their own business or working for corporations at salaries a small business can’t afford.

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Differentiation Isn’t Skin Deep

Five years ago, I took a sales training course from Blair Enns (Win Without Pitching.) The course focused on how to sell agency services at a premium. One of his criteria for an agency that could command higher pricing was their process. He said, “Your agency must have a process that is so different that it requires weeks of training whenever you onboard a new employee.”

I thought it was an odd characteristic.

Positioning and marketing are all about perception: how the world sees you. It makes sense that you need to differentiate from similar businesses in the market’s eyes. But underneath the hood, a UX designer is a UX designer the same as a grocery clerk is a grocery clerk. If you go into Whole Foods or Trader Joes, there’s a line of people who get their food swiped through a bar code scanner at check-out. The people and process are the same.

In hindsight, what Enns was recommending, in a round-about way, was for the agency to have a distinct strategy.

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Merging to Grow

I spent my Sunday driving back from my parents’ farm in Southern Idaho. As I drove, I listened to a course on business strategy. One of the lessons was on mergers and acquisitions. The main point was that most of the time businesses merge or acquire other businesses for the wrong reasons and research shows that it rarely works. The lecturer said that it’s often a misguided attempt to grow.

On Monday morning, I hopped on a call with a guy named Alan who operates a similar business to mine, in the market I’m trying to enter, but who has been working there for nearly thirty years. Alan is approaching retirement and wants to see his business continue. He told me on that call that he’s interested in merging our companies.

Here’s the initial deal Alan proposed:

  • His two long term employees would get equity.
  • He and his partner would retain ownership of the company.
  • I would take control of the business.
  • Our two teams would merge.

From his perspective, he thought I would benefit with:

  • Gaining his client list.
  • Being able to sell and build off his established relationships and brand.

That’s not attractive to me, but we’re going to keep talking to explore if there’s a way we can both achieve our goals.

What the lecturer recommended for mergers and acquisitions was to calculate the burden of merging. He said that often managers focus on the potential upside of deals- like me focusing on what I could do with Alan’s clients or portfolio. What most folks miss is that there is a challenge and cost to merging. It takes an investment to integrate teams, systems, and resources in a way that is productive. For Alan, if we merged, I’d have to take on the history of his choices: technologies we don’t use, system differences, client choices, and etc.

It’s sort of like considering whether to marry someone and only seeing the potential of that union. If you took a closer look though, you’d realize that marriage means you’ll have to live in a house with six cats, continually clean up after a slob, and keep one eye over your shoulder for that jealous ex who will be released from prison next year.

Two Lessons on Values

I’m president of my local Toastmasters club. Every meeting that I’ve attended has started with the president reviewing the Toastmasters’ mission. Under my leadership, we’ve started instead with a brief question or example of one of the club values. There are four values from our international organization parent:

  • Respect
  • Integrity
  • Service
  • Excellence

I introduced the values at a meeting by asking who knew them? Only one veteran member knew what the values were. When I gave the members the opportunity to speak on the role of values, someone said, “Values are what an organization tells you to try and make you fit into the system they’ve created.” In other words, a top-down attempt at manipulation.

To these four values that Toastmasters International provided, I’ve added:

  • Acceptance
  • Fun

I believe the four original values accurately reflect our culture today. However, they’re missing the additional two values which I’ve observed in our club’s behavior. In other words, bottom-up values derived from members.

Five years ago, I set the values of my business:

  • Freedom
  • Integrity
  • Results
  • Growth

These are a reflection of my personal values. I.e. Top-down.

The past two years, in weekly meetings spanning May through July each year, our team has discussed and refined these values into ten more specific expressions. I.e. bottom-up. Each week, I challenged them with actual scenarios from our work and asked them to derive principles from those scenarios, based on how they thought we should respond. Then we would discuss the long list of principles we all came up with and the pros and cons of each.

Below is what we eventually ended up with:

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The Price You Pay in Operations

I met up with some entrepreneur friends, Keith and Adam, to play a board game last weekend. Keith has been grinding to get a new SaaS product released that is an extension of his highly successful core SaaS product. After we finished gaming, we hung out in his kitchen and talked about the journey.

Keith said that he’s spending most of his time writing code, but to scale to his ideal exit point he needs to figure out enterprise sales.

Adam asked, “Why don’t you just hire a developer?”

“No one’s good enough to work on this problem,” he replied.

“What are the things in the business only you can do?” Adam asked.

“Product management, figuring out the strategic direction, what to build next,” Keith said.

I asked, “What’s the function in the business that is foundational to everything else? That must be accomplished and enables everything else?”

Keith thought for a moment and then said, “Sales.”

This is a challenge that many of us come to as owner operators.

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