Posts filed under ‘00. Letters to a Young Entrepreneur – General’
Technical innovation is often at the heart of an entrepreneurial venture. The leader’s role is to create the right environment to facilitate and foster such innovation. This requires bringing together people of different skills and specializations, ideally individuals more competent than the leader in their areas of expertise, very comfortable pushing the boundaries of the unknown in their particular domain. Their domain risk tolerance is likely to be very high.
What the leader needs to recognize is that the risk tolerance of the expert in his or her area of specialization may not apply to their tolerance of the uncertainties in other aspects of the entrepreneurial venture. For example, a scientist who may be one of the best in the world at creating new photovoltaic materials and be very at ease with the inherent uncertainty of the discovery of new PV compounds may be very un-easy with the challenges of financing or selling. Just think of the un-ease that scientist may feel when confronted with only a six-month cash runway. The role of the leader is to absorb any extraneous uncertainty that may get in the way of the expert team member, freeing that individual to do the best job possible, to do the job unbridled.
Taking responsibility for the full uncertainty of the company is the logical task of the leader in an entrepreneurial organization. After all, the senior executive has the whole company in his or her hands, and is the one person most aware of all the known factors affecting the destiny of the company. That is the nature of the office. But how does a leader cope with such a large burden?
Two “capacities” make this possible:
- The capacity to “see” the whole picture, and
- The capacity to access a compass that will point in the appropriate direction.
By seeing the whole picture, I mean the ability to see beyond the obvious and immediate, to cast a wider vista and recognize all the forces and all the opportunities. As an engineer, I am particularly sensitive to the importance of drawing the full perimeter around a problem. We are trained as systems thinkers. We learn to scope an issue, define the relevant influencing parameters, gather data, and then establish some criteria that will permit prioritization of potential solutions. Then we go into action – until either we find the right solution or find out that we chose the wrong path. So we go to the next one. The key in this process is to make sure that we are smart in outlining the envelope of the issue, in defining the frame of the decision-making canvas. Make it too narrow, and we miss some key elements. Make it too broad and the task becomes too unwieldy and will take too much time. Yet someone needs to have the bigger picture, even while the team is tackling the narrower problems. That is the leadership job.
But it is not the only job. At the same time as “holding” the big picture, the entrepreneurial leader must be capable of reducing the scope of the issue, shrinking the canvas so as to concentrate the attention of the team on the most critical issues of the moment. This skill to breathe with the canvas, to maintain flexibility of the frame’s shape and size, is what distinguishes the brilliant leaders. This “canvas breathing” permits the leader to maintain visual acuity, often threatened by constant external disturbances and frequent surprises. It can reveal the silver lining in unforeseen problems, and permits the leader to discover alternative pathways around roadblocks.
To breathe with the canvas, the entrepreneurial leader needs to distinguish between the forces that are important and those that are distracting, to filter the noise, deflect the arrows, prioritize the demands that are constantly calling. This requires stepping back, and finding quiet zones within. For me, the best way to find such quiet zones is through meditation.
Meditation also helps with the second capacity that allows the leader to absorb uncertainty: access to his or her decision making compass. The need for a compass is perhaps best illustrated by a suggestion made in a fascinating book I just read and highly recommend: Incognito by David Eagleman. I found it to be a brilliantly written overview of the functioning of the brain, by a knowledgeable and very eloquent neuroscientist. His thesis is that the overwhelming majority of our actions are determined by the millions of chemical and electrochemical events in our body, and they are deeply influenced by our lifetime experiences. We may believe that we are making “conscious decisions,” when in reality the sequence of signals that leads to our decisions have already taken place before we are aware that we are taking action. And he talks about how to access this unconscious part of us, how we tap into our vast unconscious reservoir:
“If you cannot always elicit straight answers from your unconscious brain, how can you access its knowledge? Sometimes the trick is merely to probe what your gut is telling you. So the next time a friend laments that she cannot decide between two options, tell her the easiest way to solve her problem: flip a coin. She should specify which option belongs to heads and which to tails, and then let the coin fly. The important part is to assess her gut feeling after the coin lands. If she feels a subtle sense of relief at being ‘told’ what to do by the coin, that’s the right choice for her. If, instead, she concludes that it’s ludicrous for her to make a decision based on a coin toss, that will cue her to choose the other option.”
Meditation has allowed me, at critical times, to “probe what my gut is telling me.” It allows me to withdraw from the mundane hum and the many “demand arrows” that are constantly pointing at me yelling for my attention, arrows that tend to freeze the frame of the picture I am confronting, freezing the size of my canvas. It takes me to a quiet zone within myself that allows the canvas to expand and permits me to “see” problems differently, to hear my perhaps previously undetected inner voice, and to understand the best direction to pursue.
This very important “internal work” of leadership moves to a much broader topic, which I will tackle in a future post. It deals with the ability to expand the canvas to its extreme dimension, to the infinite, where we have a chance to reach a place where everything is one. It is the place the pre-eminent Christina mystic of the last century, Thomas Merton, calls “le pointe vierge,” the place Jesuits are taught in the Ignatian exercises to assess their feelings of “desolation and consolation” as they face difficult moral dilemmas. The seeking of this convergence point, this point of oneness, is my definition of spirituality, and is also closely connected with what I believe should be a holistic vision of the raison d’etre of one’s business or, for that matter, one’s life adventure. This is nicely explored by my good friend Jim Cusumano in his upcoming book, Balance, the Business Life-Connection, to be published this April by Select Books, Inc.
On October 5, 2011 Steve Jobs died. When hearing the news I was deeply saddened. Tears came to my eyes, even though I had never met the man. So what caused this emotional response? What touched me to impart such a sense of loss? It was clearly not the loss of a personal relationship, nor the news of a sudden, unexpected tragedy that befell a fellow human being. So what thoughts triggered my sadness? In the end it boils down to the close connection between a person and a product. I love my MacBook Air, my iPhone, my iPad. I also love my Audi, my Bose sound system, my sailboat – yet I cannot imagine “grieving” for their progenitors. And yet I grieve for the person I associate with the Apple products that I cherish.
So I immediately dove into Isaacson’s biography of Steve. I wanted to get closer to the man behind my emotional response. And I came out quite troubled.
I knew something of Steve’s life, of course. It could not be helped having lived in Silicon Valley for the last four decades. In fact, the more I read the more I was struck by how closely “our” paths had touched: my children went to the same middle school and high school as Steve, though a few years later. My professional life as an entrepreneur was impacted by some of the same people that influenced Steve: Regis McKenna, who in the 70s spent many days with me and my partner Jim Cusumano, musing over how to position our company in what was then a brand new concept; Larry Sonsini, our company’s attorney since the early 80s; Tommy Davis Jr., whose venture firm was an early investor in Apple and also our lead investor in the early 80s. Steve and I even had an affinity for the same little Ryokan in Kyoto — the Tawaraya Inn — one of my favorite spots when I did business in Japan in the 1970s and 1980s. But the Steve who emerged from Isaacson’s book is a very different Steve from my image at that moment when I grieved for his passing. The Steve that emerged raises many questions in my entrepreneurial mind.
First, I want to list the things that I admire, which certainly fit with my idea of what makes a good entrepreneur:
- His uncompromising belief in quality – inside out
- His insistence that product comes first, not profit
- His attitude to never be afraid of cannibalizing your own products; if you do not, someone else will
- His attitude to leapfrog when you find yourself behind, not just catch up – or give up
- His belief in cross-skill teams and the intimate participation of all departments — design, hardware, software, content — very anti-silo.
- His insistence on focusing the company on a few key products
- His uncanny ability to sense what the market needed well before the market knew it (I love his reference to Henry Ford, who said, — “If I asked customers what they wanted, they would have told me, a faster horse!”)
- His keen sense of pricing of the “consumer” products he created, displayed as early as the illegal “blue box” that he and Steve Wozniak built to make long distance calls for free
- His sense of aesthetics and simplicity – epitomized for me in the MacBook Air
- His passionate pursuit of a product vision
- His stubborn perseverance
Now to the troubling part: his behavior toward others. The picture that emerges from Isaacson’s book is of a person who seems to care only about his immediate agenda, and “used” everyone around him to achieve his goals. Even if only some of what we read is true, it portrays someone who has very little concern for the humanity and dignity of others, unless they serve his purpose. This bothers me deeply: I think it is the wrong template for a good entrepreneur. In particular, something that really troubles me: he is reported to first dismiss people’s ideas and then resurface them later, without attribution. For me, this is totally unacceptable in a good leader. In this and other examples, he appears to disregard what most of us consider basic standards of behavior in a civilized society –what arrogance!
In my book I write:
“The tension between hubris and humility is one of the most serious personal dilemmas faced by the entrepreneur. Hubris, the point at which self-confidence turns into conceit, can be a trap in which we lose our bearings, with destructive consequences not just for ourselves but also for many others. To keep in balance we need to maintain a spiritual anchor and manifest that core in our moral and ethical behavior.”
I am not sure Steve Jobs ever had any bearings. His own family, when commenting on why he was so “mean” to others, is reported to have said that ““he lacked the filter.” Certainly not a very Zen-like balance. As Isaacson said: “Unfortunately, his Zen training never produced in him a Zen-like calm or inner serenity.”
And yet this complex person was able to tune so directly into the essence of products that we could not imagine before they were in front of us, but once we touched them we would say “of course, we knew it all along!” This single mindedness raises some powerful questions:
- Are all extraordinary people so focused that they cannot relate to those around them in any way but the one that serves their focus? Mozart was a genius who left an indelible legacy. From what I gather, he also was not a very nice person, and had the habit of deriding those around him with a vast superiority complex. Perhaps that is not surprising. Mozart was a young genius who was never allowed to grow up in a normal way. Did Jobs have a normal childhood? He was certainly precocious: at 13 he called Bill Hewlett and landed a summer job! Is it surprising that he never lost the child within–the good, the bad, the immature?
- Was the price of “strewn bodies” worth the gain of these delightful products that so many of us cherish?
- Is ruthlessness a desirable trait in the service of a product vision? Isaacson: “The nasty edge to his personality was not necessary. It hindered him more than it helped him. But it did, at times, serve a purpose.”
- Jobs was described by many of his co-workers as having a “distorted reality.” To what extent did this serve the purpose of achieving the seemingly impossible? (I should listen to myself; I suspect some of my colleagues thought I had a distorted reality as I drove our companies to uncharted territory…)
- How safe is it, in the long run, to have a CEO who does not believe that the rules apply to him? Many companies eventually collapse from this belief, as some have in the last decade…
Apple’s story is perhaps the extreme example of lessons we all should heed:
- Apple seemed to be a very tense and competitive environment; one might even call it cut throat (certainly they cut the throat of those whom Steve considered to be “B” players.) Could they have succeeded with a more humane executive?
- I cannot imagine building a company with an attitude that one day derides an idea as “junk” and the next day comes forth with the same idea as if it were that of the lead executive, not giving credit to the person who originally posed the idea. That is revolting to me. Yet, it was a pattern for Jobs. That people tolerated this is amazing. It calls for a re-definition of being genuine…
- Toward the end of his life, Steve shared with Isaacson some final thoughts, including, “The reason Apple resonates with people is that there is a deep current of humanity in our inventions.” What was Steve’s definition of “humanity?” Did he really understand the concept? Or did he see only a small sliver of what makes us human?
In the end, Jobs was very lucky that he found people who would follow him in spite of his abrasive personality. And the rest of us enjoy reaping the fruits of his idiosyncrasies. I abide my tears upon hearing of his passing, even after reflecting on some of the less-than-commendable traits of this extraordinary and complex individual. I love my Apple products, and hope that they will keep coming, without loss of humanity either in their ultimate manifestation or in the process of their making.
A Brief Post-Script:
It is ironic that the company which inspired Jobs in his early years, Hewlett Packard, was founded and led by two individuals who were the antithesis of Steve. In fact, their management style became the template for many of us who became entrepreneurs: “The HP Way.” Also interesting: HP lost its bearings after its founders were gone. Ominous?
Would you trust your money to somebody who is solely thinking of a serial-exit? I doubt it. I certainly would not. And, yet, “serial” and “exit” are frequently used – sometimes proudly – by so many in the venture community.
Let’s start with “serial.”
How often have you heard attendees at business gatherings introduce themselves as “serial entrepreneurs?” I have witnessed it with increasing frequency, and every time I shudder. To me, the terms serial and entrepreneur do not belong together. They violate the essence of an entrepreneur: his or her total dedication to the enterprise. You want the entrepreneur to be fully consumed by the dream, and to vest in the journey a level of emotional intensity that does not leave room for second thoughts. The real entrepreneur is in it fully. This complete emotional investment represents the key difference between just being a good leader and being a good entrepreneur. The former does not require the totality of commitment, the latter does. So, the real entrepreneur would not view his or her avocation as “serial” since there is no thought of “leaving” but only of building. Which brings me to “exit.”
A favorite question of venture capitalists is “what is your exit strategy?” Again, another non-sequitur. The entrepreneur should be ONLY thinking of growth and impact, not of when or how to get out. Of course, it is OK to talk about a liquidity strategy. That is part and parcel of the capital formation task of any venture, since most sources of capital require definition of cash-out conditions. But that has nothing to do with “exit.” Unless, of course, the investor is worried about the entrepreneur’s capability to lead as the enterprise grows. A very different – and good – problem, as it implies enough success to warrant new leadership skills that the entrepreneur may or may not have.
I do not know whether it is that I am getting old (a welcome fact) or soft (some may argue that on the human side I have always been) but I have been sensitive to touch lately. In my role as a member of the Board of Directors for several public companies and one academic center, I observe many chief executives and their senior teams. I marvel at the differences in how these accomplished individuals interact with their various constituents, particularly noticing those who are exercising leadership and those who are merely managing others. The difference can often be seen in how they connect: how they “touch.”
Two very concrete situations come to mind, involving two different organizations. In both of these cases, after reviewing presentations for an upcoming Board meeting, I shared by e-mail some brief observations with the CEO. One CEO immediately sent back a short note: “good comments, thank you.” I never heard back from the other. One touched me back; the other did not. Which case do you think made me feel better? Of course, there are many possible reasons why the second one did not respond. Too busy; never saw my e-mail; my observations not relevant. The latter was unlikely, since I did subsequently send the same comments to the Board Chair, and they were very positively received. But that is not the point. The point is that in one case there was closure of the interaction; none in the other. The first created an enrichment of the relationship; the second left a void. It was no big deal in the grand scheme of things, yet it was one of those subtle instances that to me differentiates good leadership.
Perhaps some CEOs think that we Board members do not need to be “touched.” After all, we are “accomplished individuals with extensive executive experience and a proven track record.” (This came from a Board Director job description.) Well, I have news for those CEOs: We are human too, vulnerable and uncertain at times, and with varying degrees of self-esteem, even if we all convey enormous self-confidence. We can all use – and often cherish – the feeling that we are needed and our contributions acknowledged and recognized. This is so even when (as has happened to me often) my suggestions, while not acknowledged, show up as actions later on. Yes, actions do speak louder than words, yet recognition still reinforces relationships.
The issue is, perhaps, aggravated by the prevalence of Internet communication. In my past career, I depended heavily on direct, in-person communication to fully convey meaning. I believe my colleagues felt my intentions as much as they understood them intellectually – tone of voice, body language, facial expression. And I could immediately gauge the level of understanding and connection in the exchange. Even silence in the conversation revealed enormous content. All those elements of effective dialogue are absent in e-mail communication, requiring us to be particularly mindful in the exchange. A word or two added to an e-mail can convey sentiment. The speed of the response can convey import. Cold as the electronic exchange medium may be, one can convey caring.
I believe it is essential to respond to all e-mails even with the briefest of acknowledgments. One of my favorite Board members, Ernie Mario, always impressed and touched me: he responded immediately to every communication, even if just with a short note. And one of my most treasured advisors, Larry Sonsini, always got back to me in less than 24 hours no matter where in the world he was. He made me feel that I mattered. But then Larry had this extraordinary capability to make me feel that I was the most important person in the world to him at that moment, no matter how busy he was.
We need to remember that so much of leadership is establishing and strengthening alliances. As leaders we are, after all, chartered with the task of sweeping others in our path to carry out the organization’s mission. We get others to join us, to the best of their abilities, in the pursuit of a goal. We seek ardor, not just execution. We seek added genius, not mere implementation. This requires continuous contact, acknowledgement, and appreciation of support. This touch, in the service of sustaining a vital connection, becomes even more important when the communication is largely electronic.
Granted, some of us need more touch than others, but I suggest that we all value it and, as leaders, must deliver it.
Last night I had my first Letters to a Young Entrepreneur book discussion! Several topics became the focus of the conversation. This is an intimate group of friends that have been meeting for years to discuss books, and last night’s choice was Letters. One of the participants, prompted by the “Introduction” section in my book, questioned the role of family influence in shaping entrepreneurs. For me, my father’s explicit attitude that difficulties were always viewed as challenges became a key to my approach to the vicissitudes of growing a business. One of the other participants, a very successful advertising entrepreneur, had a similar experience. Throughout her business career she remembered her father’s words: “while others stand and watch, you act.” The bumps on the road, far from causing her to slow down or even desisting, became the opportunities to do better and to get ahead. In my book I have many examples of how this attitude was important for me. In fact I consider seeing the glass half full to be a hallmark of the entrepreneur. I welcome hearing of your own experiences in this regard.
In Letters to a Young Entrepreneur I have shared with you some of the highlights of my entrepreneurial journey. Here I very much welcome your comments, critique, suggestions, and, most importantly, sharing of your own experiences and insights.
My hope is that through this dialogue we all benefit from our common entrepreneurial adventure, and perhaps provide some new approaches to the challenges we all face as we embody our dream.