I recently finished The Alliance: Managing Talent in the Networked Age by Reid Hoffman, Ben Casnocha and Chris Yeh. It’s a book about rethinking the relationship between employees and employers. I’d say the audience is primarily executives and managers, well as HR leaders. Both as an employee and as a founder, I found it an interesting read. It’s a fairly quick read, which is nice as most business books drag out their ideas for far too long. There’s also a companion website that allows people to follow up and learn more about their ideas. Continue reading

Getting honest and useful feedback is a wonderful gift. Obviously positive feedback (“You’re doing a great job with this project!”) is awesome because it makes you feel good and motivated to keep up the good work. Negative feedback, (“Your site is extremely hard to navigate and I wasn’t able to complete the signup process”) can be painful to hear, but if you can swallow your pride, it’s actually an amazing opportunity to improve what you’re working on.

On the other side, being able to deliver good feedback (especially negative feedback) means you have the opportunity to influence the people and projects around you to make them better. But because many people shut down when recieving negative feedback about themselves or others, it’s important to deliver that feedback in the right way.

As a startup founder, I give and receive a ton of feedback both positive and negative, so this is something I think about a lot. Here are some suggestions I have for delivering negative feedback effectively. Follow them and watch your feedback’s influence increase.


  • Show you care about the project/person
    “I’m totally behind your efforts to help disabled athletes in China…”
  • Show you understand and are aligned with the projects goals
    “I know you are focusing on just one market at this time…” 
  • Show that you’ve thought through reasons why the implementation might be what it is
    “I bet you saw good reasons to use three buttons instead of two…”  Continue reading

Note: This is a pretty long article (~4000 words). You can skim it now but you might want to also bookmark it and fully review it when you have 15 mins or so.

Summary: Great by Choice describes the results of a deep investigation into how young companies can survive and thrive in chaotic, turbulent environments to achieve spectacular results. The book is of great value startups and entrepreneurs seeking to build enduringly great companies. In this blog post, I look at how his concepts of fanatical discipline, productive paranoia, and empirical creativity apply to building a startup that succeeds over the long-term [1].


I just finished reading Jim Collins’ new book Great by Choice: Uncertainty Chaos and Luck—Why Some Thrive Despite Them All (GBC from here on out). GBC is the spiritual sequel to a highly-regarded & best-selling book published by Collins in 2001 called Good to Great: Why Some Companies Make the Leap… and Others Don’t. Both are great reads, but I find GBC particularly relevant to technology entrepreneurs (like myself). Why? Two reasons.

The level of research behind the book:

Unlike many business books, this is not just one successful guy waxing philosophical about how he made stuff happen [2]. Jim Collins and his coauthor Morten Hansen had entire teams of research analysts work for 9 (!!) years to complete the book.

They picked industries that were highly volatile and selected young/small companies that did extraordinarily well (beating their industry’s average stock growth by 10x or more for at least 15 years). They found comparison companies that were started off very similar to the “10x companies” but only had average performance, and dissected all the data they could gather on both companies to find the differences. For more, see Appendix A below.

The companies / industries studied:

  • Computing/Software: Microsoft vs Apple [3]
  • Integrated Circuits: Intel vs AMD
  • Biotechnology: Amgen vs Genentech
  • Medical Devices: Biomet vs Kirschner
  • Surgical Devices: Stryker vs USSC
  • Insurance: Progressive vs Safeco
  • Airlines: Southwest vs PSA

The companies are relevant and familiar to tech entrepreneurs like me and many of the folks on this blog. My focus in this post is to look at how the conclusions from the research could be applied to early stage startups that WANT to build enduring and spectacularly successful companies. I’m excited to see what we find.

MYTH-BUSTING: It’s not about more vision, creativity, risk-taking or luck

One of the great things about this study is that it’s not just studying winners but looking at the difference between winners and losers. GBC found that the 10x companies were NOT more creative, visionary, ambitious, lucky, hard working, risk-taking, innovative, etc. It’s not that those things weren’t important – I think they were/are. And GBC acknowledges this.

It’s just that both groups had lots of these things. Yet they had different outcomes. So we have to look at what DIFFERED between the 10x and comparison companies. Let’s start by looking at how innovation happens at 10xers. Continue reading

I had a conversation recently with a few friends about chewing people out for mistakes that I wanted to share.

My med school friend had been observing a surgery where the surgeon had asked a nurse to get a specific item from the storage closet for use in the surgery. When the nurse got to the closet she found that they had ran out of this particular item, so she had to go all the way across the hospital to retrieve the item. She rushed back quickly, but it still took about 10 minutes – which is an eternity during surgery when the patient is already “open”, because it increases the risk of infection.

After the nurse returned, the surgeon went off on the nurse, berating her for failing to get the item back sooner and threatening the safety of this patient – even though it was not her fault that the storage closet was not properly stocked (that job laid with some third person who was not present). The surgeon chewed out the nurse so hard that she started crying and had to leave the room for almost the entirety of the surgery – meaning the operating team had make do with one less person available to help.

Some disagreement ensues

I felt that the story really underlined the reputation that surgeons have for being assholes and that his behavior was destructive and uncalled for. Surprisingly, both my trader friend and engineering manager disagreed. Their opinion was that the nurse (who was not a newbie by any measure) should have double checked all the supplies prior to the surgery and by getting chewed out, she’d learn her lesson and never let this happen again. Thus, even though the surgeon brought the nurse to tears and caused her to be ineffective for the rest of the surgery, he ultimately did the right thing in terms of maximizing patient care in the long term.

I strongly disagreed with their assessment and spent some time unsuccessfully trying to explain why.

I was so distressed by this conversation that it’s still on my mind now and I decided to write this post. So here are the 4 reasons I feel that yelling, belittling, insulting, threatening, and otherwise chewing someone out for a mistake is a really bad idea.

1. Stress inhibits initiative/creativity and encourages mindless obedience

The number one issue I have with this situation is that the nurse wasn’t even in charge of stocking the storage closet. That was someone else’s job. The surgeon wanted the nurse to take extra initiative and double check the closet – which is a great thing to encourage.

But you can’t berate some into taking initiative.

Sure, they might double check next time, but in general, when you are afraid of making mistakes, you are unlikely to take initiative to try new things. This nurse is less likely to go above and beyond the call of duty – not more. As a data point: it’s been shown that innovation efforts struggle after a firm announces restructuring efforts (a known stressor).

If you want your people to take initiative, putting them under a ton of stress for “screwing up” is not going to work.

2. When you lose control, you lose respect

When you chew someone out – it is often because you are pissed off and unleash your anger on anyone who is involved in the situation (and sometimes even unrelated people!) When you lose control of your emotions as the leader or most senior person on the team – you lose the respect of your team. You lose credibility and you lose influence.

How are you supposed to have the discipline to make the tough-but-important calls when you can’t even discipline your own emotion?

If you’re upset, it says much more about your character if you can stay calm and collected when discussing then incident – which will earn the respect of your team, making them more likely to follow your directions in the future.

3. You breed resentment which leads to turnover & passive aggressive behavior

Besides inhibiting creativity, chewing people out and making them feel bad leads to resentment, which leads to a host of negative consequences. When you resent someone, you tend to resist helping them and look for little ways to screw them. I’m sure you’ve all seen this sort of passive-agressive behavior play out in your home or work. It is toxic – you don’t want that in your workplace.

Additionally, resentment leads to people quitting. This nurse had been working at the hospital for many years – she was no dummy and had a wealth of valuable experience that can make a huge difference for patients in many ways. But if she left due to resentment or just plain burn out, that is a net negative for the hospital and for patient care.

4. You don’t get to the bottom of the problem

When you yell at someone for making a mistake and simply tell them to “never let this happen again” you are demonstrating a lack of intellectual curiosity. Most problems don’t have simple solutions – or else they would have been solved already. You need to get to the root cause of the problem.

Instead of chewing people out, a better approach might be to use the 5 Whys – a technique developed by the founder of Toyota. As the architect of the Toyota Production System describes it:

“the basis of Toyota’s scientific approach . . . by repeating why five times, the nature of the problem as well as its solution becomes clear.”

Chewing people out assumes that the problem lies with their intelligence or motivation – and if that’s really the issue – you have a bigger problem on your hands.

I guess now I have to write a post about the right way to deal with mistakes or problems with people – that will come in time but in general, two good tips would be: ask a lot of questions and work hard to set clear and agreed upon expectations.

Chewing people out doesn’t work and it’s unprofessional. So don’t do it.

UPDATE – A med school friend of mine has written his thoughts on the surgeon’s behavior: Further Thoughts on Chewing People Out

Smart, talented people care about where they work.

Good companies know this and strive to create a place where smart, talented people will feel excited about working. They know that potential employees care about things like:

  • the kinds of products they build / services they provide
  • the customers they serve
  • the tools they use
  • the people they work with
  • the compensation they receive to do this work

These are all things that companies cover in their job openings at length in an effort to sell you on applying to the firm. But one big element is missing from that list – something that plays a “crucial role in worker wellbeing and engagement” according to a 2006 Gallup study:

The role of managers and the corporation’s management style / culture.

It seems that most business skip out on the section that matters – how decisions are made, how performance will be evaluated, how the team communicates, etc. Obviously theses things are communicated implicitly – especially during the interview process, but  organizations don’t just “put it all out there”. There are notable exceptions to this rule that only showcase how rare it really is:

Unsurprisingly, these are also companies which have many, many people wanting to work there (Southwest Airlines had 90k applications for 830 hires in 2009). I believe being more open and clear about the way the organization is run is a competitive advantage. People who aren’t interested in the culture won’t waste your time – and the people who ARE interested in the culture become even more interested in working at the firm.

I understand that every manager is different – but that doesn’t mean there shouldn’t be approaches to management and the way things operate that are done that permeate throughout the company. We already expect to know about a company’s market, its product, and its team – why not its management style? I suspect there are a few reasons:

  • Many orgs don’t have a well-thought out culture / management process
  • Many orgs would be embarrassed to describe the culture / management process as it exists in their company today
  • Many orgs don’t see their culture / management process as a core part of their offering to employees
  • Many orgs don’t know what a good culture / management process looks like

Perhaps there are others – but none of the reasons I just listed are particularly good ones. (My not-that-inner hard-ass is yelling “No excuses!” right now.)

In today’s knowledge-based society where productivity comes from much more from creative output than from physical labor, and hiring the best performers is key – there are many good reasons to explicitly state your company’s culture and management style.

What do you think? I’d love to hear your thoughts in the comments.