Reacting Forward (2): Start Smart
“Fooling around with alternating current (AC) is just a waste of time. Nobody will use it, ever.” – Thomas Edison, 1889
Start Smart
Get educated across functions:
For the entrepreneur, this means the more cross-function experience you can get before starting your business, the greater your knowledge and self-confidence will be. It also means the less need you will have to hire function leaders or employees. The cash benefit is obvious, but you will also be able to make quicker, more-intuitive decisions.
Before I started my first company, and like many first-time entrepreneurs, I had expertise only in a single business function. I started in sales. Those readers who work in sales might claim there is a skill involved, and if there is, then in my opinion, it’s one anyone can learn. You talk to customers, listen to what they tell you, and find some way to satisfy their need.
Other aspects of the business fascinated me! Whenever I had the opportunity to talk with people from those other functions, such as manufacturing or finance, I would jump at it. People love to talk about what they do. I always asked them to identify key aspects of their role along with the biggest challenges and risks they faced. Everyone was keen to take me on a tour of their department, sometimes I was invited to sit in on meetings. I would repeat this “shadowing” activity several times a year with different people in each function.
These conversations led to a better understanding of how the different functions worked together in a company. Also, how decisions in one area impacted other functions. It was easier to see how poor communication across functions caused issues and how a traditional company hierarchical structure slowed the decision-making process.
I noticed how everyone greatly filtered the information they passed along to their supervisors. They were afraid to share bad news and information about risks and threats. By the time a situation report ended up on the desk of a CEO, it bore little resemblance to the reality of the event that triggered its production.
Years later, I was fortunate to be hired by a CEO who was passionate about cross-function experience. The head of marketing had previously been the chief financial officer. The heads of manufacturing and distribution swapped roles. The leader of human resources had been a former sales manager. To traditionalists, it probably seemed crazy, but the company became a huge success and the CEO was a darling of Wall Street. I recall the marketing manager confessing that he feared being caught out as a fraud because, “he had no training, and didn’t know what he was doing.” In my opinion he was the best marketing leader I had ever worked with, I feel one of the reasons was he had no preconceived notion of how things ‘should’ be done. Everything was freshly questioned.
Throughout my career, I also worked in functions for which I had no formal training. I found the fundamentals of leadership in every function are pretty much the same, which is, the ability to manage and direct a small group of people. When it came time to start my own company, I had a high level of self-confidence, and some knowledge with experience in every function. I never felt the need to hire functional experts. Instead, I hired part-time consultants and let them get on with their jobs without onerous updates and reporting requirements. I knew I could spot issues or opportunities when they came up and not be blind-sided through ignorance of the function.
Here’s what I suggest all startup entrepreneurs do:
Arm yourself with sufficient knowledge to run a business without feeling the need to hire functional leaders. If possible, do this before launching your business. This way you can incorporate any new understandings and expertise in your business plan. It’s never too late to learn.
We live in a marvellous age in which technology, transport, and communication systems mean you don’t have to work your way through every department to get knowledge. Although, if you don’t plan to start a company for a few years, it’s something to consider.
Here are three things you can do at anytime to gain knowledge and self-confidence.
1.) Start Smart: Shadow Function Leaders
A ‘preceptorship’ is a period of observational training that’s often used for future medical professionals. A more-experienced medical professional (or preceptor) provides observation time for the less-experienced. It works just as well in business, but it is rarely used. In my regular career, I did as much of this as time allowed. You can’t learn the intricacies of accounting just by watching a CFO at work, but you can learn the bigger picture quite easily. You can see how different parts of the business impact cash flow and learn the challenges of balancing revenues with profit and income.
If you have never made sales calls before or understood marketing, you should spend a few days in the field with some sales representatives. They’re usually glad of the company. It’s a great way to learn tips for cold calling, overcoming objections, and closing the sale. This will raise self-confidence in your ability to interact with customers. Similarly, you can attend manufacturing audits, simply watch and learn. By doing preceptorships in this way, you get many real-life insights that cannot be learned in a classroom.
Shadowing function leaders for a day also provides what I call the, “Wizard of Oz benefit.” You pull back the curtain to reveal the true nature of what people do. Often times a realization sets in that you already possess the ability and smarts to do it as well. In The Wizard of Oz, Dorothy thinks she needs the “great and powerful Oz” to get home, but Oz is a conman, not a wizard. Dorothy then understands she had the power to get home by herself all along.
2). Start Smart: Attend Industry and/or Functional Seminars and Conferences
Another way to gain cross-function knowledge and self-confidence is to attend a seminar focusing on whatever business function you need more experience in. Every year, there are hundreds of events on finance, research, regulations, marketing, and manufacturing. If you are still working a regular job, plan to attend a conference on each major business function this next year. More than likely, there are plenty of such activities in your local area – search online to find them. Attending lectures helps identify key issues in today’s market.
An added benefit is meeting people who work in that function. By listening to them, you will learn how they speak and understand any insider acronyms and jargon. You also make contacts and develop relationships that you can call on for advice or help.
3). Start Smart: Take Online Business Courses
Technology gives you access to an array of online business courses, many of which focus on providing cross-function education. There are many local courses you can find that will broaden your awareness. Getting a full-blown MBA is not necessary to run a startup. If you decide to complete an MBA course, keep in mind that most curricula are designed to improve mid-management skill sets. They teach human resource skills, management by objectives, project leadership, and classic marketing tactics. Much of that isn’t useful for a startup that doesn’t have a product or any clients yet. Hand on heart, I cannot think of a single technique taught in my MBA that I use in the startup phase. If you want to take classes, my advice is to look for courses that teach the rudiments of different functions.
Homework Time:
A good way to start here is (as with most things) to take a pad and pen and figure out two columns. One is titled, “What I know.” One is titled, “What I need help with.”
Go through the functions that will form your business… sales, software, manufacturing, design, copy, social media, regulatory, hardware, accounting, etc.
Figure out what you don’t know and then how to fill in the education gap.
Be honest with yourself. Very few people know it all when they start but the smart ones are those who know what it is they don’t know.
Resources
A word about using smart intentions.
