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The Gift of Feedback, Part IV

I wrote a few weeks ago about my live 360 – the first time I’ve ever been in the room for my own review discussion. I now have a development plan drafted coming out of the session, and having cycled it through the contributors to the review, I’m ready to go with it. As I did in 2008, 2009, and 2011, I’m posting it here publicly. This time around, there are three development items:

Continue to spend enough time in-market. In particular, look for opportunities to spend more time with direct clients. There was a lot of discussion about this at my review. One director suggested I should spend at least 20% of my time in-market, thinking I was spending less than that. We track my time to the minute each quarter, and I spend roughly 1/3 of my time in-market. The problem is the definition of in-market. We have a lot of large partners (ESPs, ISPs, etc.) with whom I spend a lot of time at senior levels. Where I spend very little time is with direct clients, either as prospects or as existing clients. Even though, given our ASP, there isn’t as much leverage in any individual client relationship, I will work harder to engage with both our sales team and a couple of larger accounts to more deeply understand our individual client experience.
Strengthen the Executive Committee as a team as well as using the EC as the primary platform for driving accountability throughout the organization. On the surface, this sounds like “duh,” isn’t that the CEO’s job in the first place? But there are some important tactical items underneath this, especially given that we’ve changed over half of our executive team in the last 12 months. I need to keep my foot on the accelerator in a few specific ways: using our new goals and metrics process and our system of record (7Geese) rigorously with each team member every week or two; being more authoritative about the goals that end up in the system in the first place to make sure my top priorities for the organization are being met; finishing our new team development plan, which will have an emphasis on organizational accountability; and finding the next opportiunity for our EC to go through a management training program as a team.
Help stakeholders connect with the inherent complexity of the business. This is an interesting one. It started out as “make the business less complex,” until I realized that much of the competitive advantage and inherent value from our business comes fom the fact that we’ve built a series of overlapping, complex, data machines that drive unique insights for clients. So reducing complexity may not make sense. But helping everyone in and around the business connect with, and understand the complexity, is key. To execute this item, there are specifics for each major stakeholder. For the Board, I am going to experiment with a radically simpler format of our Board Book. For Investors, Customers, and Partners, we are hard at work revising our corporate positioning and messaging. Internally, there are few things to work on — speaking at more team/department meetings, looking for other opportunities to streamline the organization, and contemplating a single theme or priority for 2015 instead of our usual 3-5 major priorities.

Again, I want to thank everyone who participated in my 360 this year – my board, my team, a few “lucky” skip-levels, and my coach Marc Maltz. The feedback was rich, the experience of observing the conversation was very powerful, and I hope you like where the development plan came out!

The Gift of Feedback, Part III

I’ve written about our 360 Review process at Return Path a few times in the past:

And the last two times around, I’ve also posted the output of my own review publicly here in the form of my development plan:

Here in 2008
Here in 2009

So here we are again. I have my new development plan all spruced up and ready to go. Many thanks to my team and Board for this valuable input, and to Angela Baldonero (my fantastic SVP People and in-house coach), and Marc Maltz of Triad Consulting for helping me interpret the data and draft this plan. Here at a high level is what I’m going to be working on for the next 1-2 years:

Institutionalize impatience and lessen the dependency dynamic on me. What does this mean? Basically it means that I want to make others in the organization and on my team in particular as impatient as I am for progress, success, reinvention, streamlining and overcoming/minimizing operational realities. I’ll talk more about something I’ve taken to calling “productive disruption” in a future blog post
Focus on making every staff interaction at all levels a coaching session. Despite some efforts over the years, I still feel like I talk too much when I interact with people in the organization on a 1:1 or small group basis. I should be asking many more questions and teaching people to fish, not fishing for them
Continue to foster deep and sustained engagement at all levels. We’ve done a lot of this, really well, over the years. But at nearly 250 people now and growing rapidly, it’s getting harder and harder. I want to focus some real time and energy in the months to come on making sure we keep this critical element of our culture vibrant at our new size and stage
I have some other more tactical goals as well like improving at public speaking and getting more involved with leadership recruiting and management training, but the above items are more or less the nub of it

One thing I know I’ll have to do with some of these items and some of the tactical ones in particular is engage in some form of deliberate practice, as defined by Geoffrey Colvin in his book Talent is Overrated (blog post on the book here). That will be interesting to figure out.

But that’s the story. Everyone at Return Path and on my Board – please help me meet these important goals for my development over the next couple of years!

Return Path Core Values, Part II

As I said at the beginning of this series, I was excited to share the values that have made us successful with the world and to also articulate more for the company some of the thinking behind the statements.

You can click on the tag for all the posts on the 13 Return Path’s core values, but the full list of the values is below, with links to each individual post, for reference:

As I noted in my initial post, every employee as of August 2008 was involved in the drafting of these statements. That’s a long post for another time, but it’s an important part of the equation here. These were not top-down statements written by me or other executives or by our People team. Some are more aspirational than others, but they are the aspirations of the company, not of management!

People First

I do not think it’s telling that my fourth post in this series of posts on Return Path’s core values (kickoff post, tag cloud) is something called People First. Ok, it probably should have been the first post in the series. To be fair, it is the first value on our list, but for whatever reason, the value about Ownership was top of mind when I decided to create this series.

Anyway, at Return Path,

We believe that people come first

And we aren’t shy about saying it publicly, either. This came up in a lengthy interview I did with Inc. Magazine last year when we were profiled for winning an award as one of the top 20 small- and mid-sized businesses to work for in America. After re-reading that article, I went back and tried to find the slide from our investor presentations that I referred to. I have a few versions of this slide from different points in time, including one that’s simpler (it only has employees, clients, and shareholder on it) but here’s a sample of it:

That pretty much says it all. We believe that if we have the best and most engaged workforce, we will do the best job at solving our clients’ problems, and if we do that well, our shareholders will win, too.

How does this “people first” mentality influence my/our day-to-day activities? Here are a few examples:

We treat all employees well, regardless of level or department. All employees are important to us achieving our mission – otherwise, they wouldn’t be here. So we don’t do a lot of things that other companies do like send our top performing sales reps on a boondogle together while the engineers and accountants slave away in the office as second-class citizens. That would be something you might see in a “sales first” or “customer first” culture
We fiercely defend the human capital of our organization. There are two examples I can think of around this point. First, we do not tolerate abusive clients. Fortunately, they are rare, but more than once over the years either I or a member of my senior team has had to get on the phone with a client and reprimand them, or even terminate their contract with us, for treating one of our employees poorly and unprofessionally. And along the same lines, when all economic hell broke loose in the fall of 2008, we immediately told employees that while we’d be in for a rough ride, our three top priorities were to keep everyone’s job, keep everyone’s compensation, and keep everyone’s health benefits. Fortunately, our business withstood the financial challenges and we were able to get through the financial crisis with those three things intact.
We walk the walk with regard to employee feedback. Everyone does employee satisfaction surveys, but we are very rigorous about understanding what areas are making people relatively unhappy (for us, even our poor ratings are pretty good, but they’re poor relative to other ratings), and where in the employee population (office, department, level) those issues lie. We highlight them in an all-hands meeting or communication, we develop specific action plans around them, and we measure those same questions and responses the next time we do a survey to see how we’ve improved
We invest in our people. We pay them fairly well, but that’s not what I’m talking about. We invest in their learning and growth, which is the lifeblood of knowledge workers. We do an enormous amount of internal training. We encourage, support, and pay for outside training and education. We are very generous with the things that allow our employees to be happy and healthy, from food to fitness to insurance to time off to a flexible environment to allowing them to work from another office, or even remotely, if their lives require them to move somewhere else
I spend as little time as I possibly can managing my shareholders and as much time as I can with employees and prospective employees. That doesn’t mean I don’t interact with my Board members – I do that quite a bit. But it does mean that when I do interact with them, it’s more about what they can do for Return Path and less about reporting information to them. I do send them a lot of information, but the information flow works well for them and simultaneously minimizes my time commitment to the process: (1) reporting comes in a very consistent format so that investors know WHAT to expect and what they’re looking at, (2) reporting comes out with a consistently long lead time prior to a meeting so investors know WHEN to expect the information, (3) the format of the information is co-developed with investors so they are getting the material they WANT, and (4) we automate as much of the information production as possible and delegate it out across the organization as much as possible so there’s not a heavy burden on any one employee to produce it
When we do spend time with customers (which is hopefully a lot as well), we try to spread that time out across a broad base of employees, not just salespeople and account managers, so that as many of our employees can develop a deep enough understanding of what our customers’ lives are like and how we impact them

There are plenty of companies out there who have a “shareholder first” or “customer first” philosophy. I’m not saying those are necessarily wrong – but at least in our industry, I’ll bet companies like that end up with significantly higher recruiting costs (we source almost half our new hires from existing employee referrals), higher employee churn, and therefore lower revenue and profit per employee metrics at a minimum. Those things must lead to less happy customers, especially in this day and age of transparency. And all of those things probably degrade shareholder value, at least over the long haul.

Return Path Core Values

At Return Path, we have a list of 13 core values that was carefully cultivated and written by a committee of the whole (literally, every employee was involved) about 3 years ago.

I love our values, and I think they serve us incredibly well — both for what they are, and for documenting them and discussing them publicly. So I’ve decided to publish a blog post about each one (not in order, and not to the exclusion of other blog posts) over the next few months. I’ll probably do one every other week through the end of the year. The first one will come in a few minutes.

To whet your appetite, here’s the full list of values:

We believe that people come first
We believe in doing the right thing
We solve problems together and always present problems with potential solutions or paths to solutions
We believe in keeping the commitments we make, and communicate obsessively when we can’t
We don’t want you to be embarrassed if you make a mistake; communicate about them and learn from them
We believe in being transparent and direct
We challenge complacency, mediocrity, and decisions that don’t make sense
We value execution and results, not effort on its own
We are serious and passionate about our job and positive and light-hearted about our day
We are obsessively kind to and respectful of each other
We realize that people work to live, not live to work
We are all owners in the business and think of our employment at the company as a two-way street
We believe inboxes should only contain messages that are relevant, trusted, and safe

Do these sound like Motherhood and Apple Pie? Yes. Do I worry when I publish them like this that people will remind me that Enron’s number one value was Integrity? Totally. But am I proud of my company, and do I feel like we live these every day…and that that’s one of the things that gives us massive competitive advantage in life? Absolutely! In truth, some of these are more aspirational than others, but they’re written as strong action verbs, not with “we will try to” mushiness.

I will start a tag for my tag cloud today called Return Path core values. There won’t be much in it today, but there will be soon!

Solving Problems Together

Last week, I started a series of new posts about our core values (a new tag in the tag cloud for this series) at Return Path. Read the first one on Ownership here.

Another one of our core values is around problem solving, and ownership is intrinsically related. We believe that all employees are responsible for owning solutions, not just surfacing problems. The second core value I’ll write about in this series is written specifically as:

We solve problems together and always present problems with potential solutions or paths to solutions

In terms of how this value manifests itself in our daily existence, for one thing, I see people working across teams and departments regularly, at their own initiative, to solve problems here. It happens in a very natural way. Things don’t have to get escalated up and down management chains. People at all levels seem to be very focused on solving problems, not just pointing them out, and they have good instincts for where, when, and how they can help on critical (and non-critical) items.

Another example, again relative to other workplaces I’ve either been at or seen, is that people complain a lot less here. If they see something they don’t like, they do something about it, solve the problem themselves, or escalate quickly and professionally. The amount of finger pointing tends to be very low, and quite frankly, when fingers are pointed, they’re usually pointed inward to ask the question, “what could I have done differently?”

The danger of a highly collaborative culture like ours is teams getting stuck in consensus-seeking. Beware! The key is to balance collaboration on high value projects with authoritative leadership & direction.

A steady flow of problems are inherent in any business. I’m thankful that my colleagues are generally quite strong at solving them!

A Lighter, Yet Darker, Note

I’ve been meaning to post about this for some time now since my colleague Tami Forman introduced me to this company. It’s a riot.

You know all those well-intentioned, but slightly cheesy motivational posters you see in places like dentists’ offices? The kind that talk about “Perseverence” and “Commitment” and “Dare to Dream” and have some beautiful or unique, usually nature-centric image to go with them and their tag line?

For the sarcastic among us, you must visit Despair, Inc.’s web site, in particular any of the “Individual Designs” sections featured on the left side navigation. The posters are brilliant spoofs on the above, with such gems as “Agony” and “Strife” and “Despair” (whose tag line is “It’s always darkest just before it goes pitch black”). E.L. Kersten is one funny, albeit strange dude.

Worth a look, and everything is for sale there, too, in case you need to have these posted in a back room somewhere.

Email Deliverability Data

We just published our 2004 year-end email deliverability report. Feel free to download the pdf, but I’ll summarize here. First, this report is very different from the reports you see published by Email Service Providers like Digital Impact and DoubleClick, because (a) it measures deliverability across a broad cross-section of mailers, not just a single ESP’s clients, and (b) it is a true measure of deliverability — what made it to the inbox — as opposed to the way some ESPs measure and report on deliverability, which is usually just the percentage of email that didn’t bounce or get outright blocked as spam.

Headline number one: the “false positive” problem (non-spam ending up in the junk mailbox) is getting worse, not better. Here’s the trend:

Full year 2004: 22%
Second half 2003: 18.7%
First half 2003: 17%
Second half 2002: 15%

Headline number two: mailers who work on the problem can have a huge impact on their deliverability. Obviously, I’m biased to Return Path’s own solution for mailers, but I think you can extrapolate our data to the broader universe: companies that work on understanding, measuring, and solving the root causes of weak deliverablility can raise their inbox rate dramatically in a short time — in our study, the average improvement was a decrease in false positives from 22% to about 9% over the first three months. But we have a number of mailers who are now closer to the 2% false positive level on a regular basis.

I Don’t Want to Be Your Friend (Today)

The biggest problem with all the social networks, as far as I can tell, is that there’s no easy and obvious way for me to differentiate the people to whom I am connected either by type of person or by how closely connected we are.

I have about 400 on Facebook and 600 on LinkedIn. And I’m still adding ones as new people get on the two networks for the first time. While it seems to people in the industry here that “everyone is on Facebook,” it’s not true yet. Facebook is making its way slowly (in Geoffrey Moore terms) through Main Street. Main Street is a big place.

But not all friends are created equal. There are some where I’m happy to read their status updates or get invited to their events. There are some where I’m happy if they see pictures of me. But there are others where neither of these is the case. Why can’t I let only those friends who I tag as “summer camp” see pictures of me that are tagged as being from summer camp? Why can’t I only get event invitations from “close friends”? Wouldn’t LinkedIn be better if it only allowed second and third degree connections to come from “strong” connections instead of “weak” ones?

It’s also hard to not accept a connection from someone you know. Here’s a great example. A guy to whom I have a very tenuous business connection (but a real one) friends me on Facebook. I ignore him. He does it again. I ignore him again. And a third time. Finally, he emails me with some quasi-legitimate business purpose and asks why I’m ignoring him — he sees that I’m active on Facebook, so I *must* be ignoring him. Sigh. I make up some feeble excuse and go accept his connection. Next thing I know, I’m getting an invitation from this guy for “International Hug a Jew Day,” followed by an onslaught of messages from everyone else in his address book in some kind of reply-to-all functionality. Now, I’m a Jew, and I don’t mind a hug now and then, but this crap, I could do without.

I mentioned this problem to a friend the other day who told me the problem was me. “You just have too many friends. I reject everyone who connects to me unless they’re a really, super close friend.” Ok, fine, I am a connector, but I don’t need a web site to help me stay connected to the 13 people I talk to on the phone or see in person. The beauty of social networks is to enable some level of communication with a much broader universe — including on some occasions people I don’t know at all. That communication, and the occasional serendipity that accompanies it, goes away if I keep my circle of friends narrow. In fact, I do discriminate at some level in terms of who I accept connections from. I don’t accept them from people I truly don’t know, which isn’t a small number. It’s amazing how many people try to connect to me who I have never met or maybe who picked up my business card somewhere.

The tools to handle this today are crude and only around the edges. I can ignore people or block them, but that means I never get to see what they’re up to (and vice versa). That eliminates the serendipity factor as well. Facebook has some functionality to let me “see more from some people and less from others” — but it’s hard to find, it’s unclear how it works, and it’s incredibly difficult to use. Sure, I can “never accept event invitations from this person,” or hide someone’s updates on home page, but those tools are clunky and reactive.

When are the folks at LinkedIn and Facebook going to solve this? Feels like tagging, basic behavioral analysis, and checkboxes at point of “friending” aren’t exactly bleeding edge technologies any more.

Book Short: The Little Engine that Could

Authors Steven Woods and Alex Shootman would make Watty Piper proud. Instead of bringing toys to the children on the other side of the mountain, though, this engine brings revenue into your company. If you run a SaaS business, or really if you run any B2B business, Revenue Engine: Why Revenue Performance Management is the Next Frontier of Competitive Advantage, will change the way you think about Sales and Marketing. The authors, who were CTO and CRO of Eloqua (the largest SaaS player in the demand management software space that recently got acquired by Oracle), are thought leaders in the field, and the wisdom of the book reflects that.

The book chronicles the contemporary corporate buying process and shows that it has become increasingly like the consumer buying process in recent years. The Consumer Decision Journey, first published by McKinsey in 2009, chronicles this process and talks about how the traditional funnel has been transformed by the availability of information and social media on the Internet. Revenue Engine moves this concept to a B2B setting and examines how Marketing and Sales are no longer two separate departments, but stewards of a combined process that requires holistic analysis, investment decisions, and management attention.

In particular, the book does a good job of highlighting new stages in the buying process and the imperatives and metrics associated with getting this “new funnel” right. One that resonated particularly strongly with me was the importance of consistent and clean data, which is hard but critical! As my colleague Matt Spielman pointed out when we were discussing the book, the one area of the consumer journey that Revenue Engine leaves is out is Advocacy, which is essential for influencing the purchase process in a B2B environment as well.

One thing I didn’t love about the book is that it’s a little more theoretical than practical. There aren’t nearly enough detailed examples. In fact, the book itself says it’s “a framework, not an answer.” So you’ll be left wanting a bit more and needing to do a bit more work on your own to translate the wisdom to your reality, but you’ll have a great jumping off point.

Getting Good Inc., Part II

It was a nice honor to be noted as one of America’s fastest growing companies as an Inc. 500 company two years in a row in 2006 and 2007 (one of them here), but it is an even nicer honor to be noted as one of the Top 20 small/medium sized businesses to work for in America by Winning Workplaces and Inc. Magazine. In addition to the award, we were featured in this month’s issue of Inc. with a specific article about transparency, and important element of our corporate culture, on p72 and online here.

Why a nicer honor? Simply put, because we pride ourselves on being a great place to work — and we work hard at it. My colleague Angela Baldonero, our SVP People, talks about this in more depth here. Congratulations to all of our employees, past and present, for this award, and a special thanks to Angela and the rest of the exec team for being such awesome stewards of our culture!