Book (Not So) Short:  Raise Your Hand If You’re Sure

I couldn’t get the catchy jingle from the 80’s commercial for Sure deodorant (you remember, the one with the Statue of Liberty at the end of it – thanks, YouTube) out of my head while I was reading the relatively new book, Confidence: How Winning Streaks and Losing Streaks Begin and End.  Written by HBS professor Rosabeth Moss Kantor, Confidence is one of the few business books I’ve read that’s both long and worth reading in full.

The book has scores of examples of both winning and losing streaks, from sports, business, politics, and other walks of life, and it does a great job of breaking down the core elements that go into creating a winning streak or turnaround (Accountability, Collaboration, Innovation).  Kantor also puts a very fine point on the “doom loop” of losing streaks and just how hard it is to turn them around.  The book also has a good crisp definition of why winning streaks end — arrogange, anyone? — and has consistent, but not preachy recipes for avoiding pitfalls and driving success.  All in all, very inspirational, even if many of the roots of success lie in well-documented leadership qualities like those expressed in Jim Collins’ Built to Last and Good to Great.  The book is good enough that Kantor can even be forgiven for lauding Verizon, probably the most consistently awful customer service company I’ve ever dealt with.

But even more of the roots of success and disappointment around streaks are psychological, and these examples really rang true for me as I reflected back on our acquisition of the troubled NetCreations in 2004.  That company was in the midst of a serious slump, a losing streak dating back to 2000, at the peak of the original Internet boom.  Year over year, the company had lost revenues, profits, customers, and key personnel.  Its parent company saw poor results and set it into the doom loop of starving it for resources and alternating between ignoring it and micromanaging it, and when we acquired the business, we found great assets and some fantastic people (many of whom I’m proud to say are still with us today), but a dispirited, blame-oriented, passive culture that was poised to continue wallowing in decline.

I can hardly claim that we’ve turned the business around in full, or that I personally made happen whatever turnaround there has been, but I do think we did a few things right as far as Kantor and Confidence would see it.  Her formula for a turnaround (Espouse the new message, Exemplify it with leadership actions, Establish programs to systematically drive it home throughout the organization) is right in line with our philosophy here at Return Path.

First, we accelerated the separation and autonomy of a fledgeling NetCreations spin-off unit, now our Authentic Response market research group, and let a culture of collaboration and innovation flourish under an exceptionally talented leader, Jeff Mattes.

But that was the easy part (for me anyway), because that part of the business was actually working well, and we just let it do its thing, with more support from HQ.  The turnaround of the core list rental and lead generation business of NetCreations, the original Postmaster Direct, was much tougher and is still a work in progress.  In the last six months, we’ve finally turned the corner, but it hasn’t been easy.  Even though we knew lots of what had to be done early on, actually doing it is much harder than b-school platitudes or even the best-written books make it seem.

The one thing that Kantor probably gives short shrift to, although she does mention it in passing a couple times, is that frequently turnarounds require massive major amounts of purging of personnel (not just management) to take hold.  As one of my former colleagues from Mercer Management Consulting used to say, “sometimes the only way to effect Change Management is to change management.”  Sometimes even very talented people are just bogged down with baggage — the “ghost of quarters past” — and nothing you do or say can break that psychological barrier.

Boy, have we learned that lesson here at Return Path the hard way.  I’m extremely grateful to our team at Return Path, from the old RP people who’ve seen it all happen, to the old NetCreations people who are thriving in the new environment, to the new blood we’ve brought in to help effect the turnaround, for playing such important roles in our own Confidence-building exercises here.  And I’m super Confident that 2007 will be the year that we officially turn the old NetCreations/Postmaster losing streak into a big, multi-year winning streak.

Anyway, I realize this may redefine the “short” in book short, but Confidence is without question a good general management and leadership read.

Book Short:  I Wish This Existed 12 Years Ago

Brad Feld has been on my board for over a decade now, and when he and his partner Jason Mendelson told me about a new book they were writing a bunch of months ago called Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist, I took note.  I thought, “Hmmm.  I’d like to be smarter than my lawyer or venture capitalist.”

Then I read an advanced copy.  I loved it.  At first, I thought, I would really have benefited from this when I started Return Path way back when.  Then as I finished reading it, I realized it’s just a great reference book even now, all these years and financings later.  But as much as I enjoyed the early read, I felt like something was missing from the book, since its intended audience is entrepreneurs.

Brad and Jason took me up on my offer to participate in the book’s content a little bit, and they are including in the book a series of 50-75 sidebars called “The Entrepreneur’s Perspective” which I wrote and which they and others edited.  For almost every topic and sub-topic in the book, I chime in, either building on, or disagreeing, with Brad and Jason’s view on the subject.

The book is now out.  As Brad noted in his launch post, the book’s table of contents says a lot:

1. The Players
2. How to Raise Money
3. Overview of the Term Sheet
4. Economic Terms of the Term Sheet
5. Control Terms of the Term Sheet
6. Other Terms of the Term Sheet
7. The Capitalization Table
8. How Venture Capital Funds Work
9. Negotiation Tactics
10. Raising Money the Right Way
11. Issues at Different Financing States
12. Letters of Intent – The Other Term Sheet
13. Legal Things Every Entrepreneur Should Know

Fred has posted his review of the book as well.

Bottom line:  if you are an aspiring or actual entrepreneur, buy this book.  Even if you’ve done a couple of financings, this is fantastic reference material, and Brad and Jason’s points of view on things are incredibly insightful beyond the facts.  And I hope my small contributions to the book are useful for entrepreneurs as well.

Book Short: Chip Off the Old Block

I have to admit, I was more than a little skeptical when Craig Spiezle handed me a copy of The Speed of Trust, by Stephen M. R. Covey, at the OTA summit last week. The author is the son of THE Stephen Covey, author of the world famous Seven Habits of Highly Effective People as well as The Eighth Habit (book, post). Would the book have substance and merit or be drafting off the dad’s good name?

I dog-ear pages of books as I read them, noting the pages that are most interesting if I ever want to go back and take a quick pass through the book to remind me about it (and yes, Ezra, I can do this on the Kindle as well via the bookmark feature). If dog-ear quantity is a mark of how impactful a book is, The Speed of Trust is towards the top of the list for me.

The book builds nicely on Seven Habits and The Eighth Habit and almost reads like the work of Stephen the father. The meat of the book is divided into two sections: one on developing what Covey calls “self trust,” a concept not unlike what I blogged about a few months ago, that if you make and keep commitments to yourself, you build a level of self-confidence and discipline that translates directly into better work and a better mental state. The other core section is one on building trust in relationships, where Covey lists out 13 behaviors that all lead to the development of trust.

In fact, we just had a medium-size trust breach a couple weeks ago with one of our key clients. Reading the book just as we are struggling to “right the wrong” was particularly impactful to me and gave me a number of good ideas for how to move past the issue without simply relying on self-flagellation and blunt apologies. This is a book full of practical applications.

It’s not a perfect book (no book is), and in particular its notion of societal trust through contribution is a bit weak relative to the rest of the book, but The Speed of Trust is an excellent read for anyone who wants to understand the fastest way to build — and destroy — a winning culture. It reads like a sequel of Covey senior’s books, but that’s a good thing.

Boards That Lead, by Ram Charan, Dennis Carey, and Michael Useem, was recommended to me by a CEO Coach in the Bolster network, Tim Porthouse, who said he’s been referring it to his clients alongside Startup Boards. I don’t exactly belong in the company of Ram Charan (Brad and Mahendra probably do!), so I was excited to read it. While it’s definitely the “big company” version to Startup Boards, there are some good lessons for startup CEOs and founder to take away from it.

The best part about the book as it relates to ALL boards is the framework of Partner, Take Charge, Stay out of the Way, and Monitor. You can probably lump all potential board activities into these four buckets. If you look at it that way…these are pretty logical:

• Monitor – what you’d expect any board to do
• Stay out of the Way – basic execution/operations
• Partner – strategy, goals, risk, budget, leadership talent development
• Take Charge – CEO hiring/firing, Exec compensation, Ethics, and Board Governance itself.

There was an interesting nugget in the book as well called the Central Idea that I hadn’t seen articulated quite this way before. It’s basically a statement of what the business is and how it’s going to win. It’s about a page long, 8-10 bullet points, and it includes things like mission, strategy, key goals, and key operating pillars that underlie the goals. It basically wraps up all of Lencioni’s key questions in one page with a little more meat on the bones. I like it and may adopt it. The authors put the creation of the Central Idea into the Take Charge bucket, but I’d put it squarely in the Partner bucket.

Other than that, the book is what you’d expect and does have a lot of overlap with the world of startups. Its criteria for director selection are very similar to what we use at Bolster, as is its director evaluation framework. The book has a ton of handy checklists as well, some of which are more applicable than others to startups, for example Dealing with Nonperforming Directors and Spotting a Failing CEO.

All in, a good read if you’re a student of Boards.

Half the Benefit is in the Preparation

This past week, we had what has become an annual tradition for us – a two-day Board meeting that’s Board and senior management (usually offsite, not this year to keep costs down) and geared to recapping the prior year and planning out 2009 together.  Since we are now two companies, we did two of them back-to-back, one for Authentic Response and the other for Return Path.

It’s a little exhausting to do these meetings, and it’s exhausting to attend them, but they’re well worth it.  The intensity of the sessions, discussion, and even social time in between meetings is great for everyone to get on the same page and remember what’s working, what’s not, and what the world around us looks like as we dive off the high dive for another year.

The most exhausting part is probably the preparation for the meetings.  We probably send out over 400 pages of material in advance – binders, tabs, the works.  It’s the only eco-unfriendly Board packet of the year.  It feels like the old days in management consulting.  It takes days of intense preparation — meetings, spreadsheets, powerpoints, occasionally even some soul searching — to get the books right.  And then, once those are out (the week before the meeting), we spend almost as much time getting the presentations down for the actual meeting, since presenting 400 pages of material that people have already read is completely useless.

By the end of the meetings, we’re in good shape for the next year.  But before the meetings have even started, we’ve gotten a huge percentage of the benefit out of the process.  Pulling materials together is one thing, but figuring out how to craft the overall story (then each piece of it in 10-15 minutes or less) for a semi-external audience is something entirely different.  That’s where the rubber meets the road and where good executives are able to step back; remember what the core drivers and critical success factors are; separate the laundry list of tactics from the kernel that includes strategy, development of competitive advantage, and value creation; and then articulate it quickly, crisply, and convincingly. 

I’m incredibly proud of how both management teams drove the process this year – and I’m charged up for a great 2009 (economy be damned!).

Triple Book Short: For Parents

People who know me know that I am a voracious reader.  Among other things, I probably read about 25-30 books per year — and I wish I had time for more.  I probably read about 50% business books, which I blog about.  Most of my other reading is in a couple specific topical areas that interest me like American History and Evolutionary Biology.  Over the last few years, Mariquita and I have discovered and read a handful of books about parenting that have been foundational for us as we work deliberately at raising our three kids, and two of them have roots in some of the same philosophies, psychologies, and research as a lot of contemporary business literature.  So for parents everywhere, I thought I’d devote a book short to these three books.

The first one is Healthy Sleep Habits, Happy Child, by Marc Weissbluth.  Having kids who sleep long and well has been the foundation for us to have a well functioning household.  Well rested kids are much easier than tired ones.  Well rested parents are more effective.  We have found that the principles in this book have consistently served us well on this front.  All three of our kids more or less slept through the night starting at 6-8 weeks and have been great sleepers since then.

Unconditional Parenting, by Alfie Kohn is basically, for those in the HR/OD field, “Action/Design” for parenting.  The principles in this book have applied to kids as young as 1 year old, and the examples in the book go through the teenage years.  Our main learnings from this book have been around moving away from more traditional forms of reward, punishment, and control and towards helping our kids make decisions as opposed to follow directions by understanding our kids perspective on things, working to help them articulate their own understanding of a situation, and helping them see the perspective of others.

Raising an Emotionally Intelligent Child, by John Gottman, builds on a lot of the same underlying work that Daniel Goleman writes about in articles and business books around Emotional Intelligence (in fact, Goleman wrote the forward to this book as well).  The book lays out a process the author calls Emotional Coaching to help kids learn empathy and problem solving by showing kids empathy, teaching them to understand and label their own emotions, and working with them to craft solutions on their own, but doing the whole process in a very calm and 1:1 manner.  One of my favorite parts of the book, which is so unusual in business books and any kind of self-help book, is that the author has a whole section devoted to when NOT to use this process.

Parenting is a very personal thing, and there isn’t a right or wrong way to go about it.  I have a friend who is fond of saying that parenting is a little bit like the way comedian George Carlin used to describe “other drivers” on the highway.  People who are going slower than you are “a**holes” and people who are going faster than you are “crazy.”  Only you drive the “right way.”  So true, but if you’re a parent, there’s no more important thing to be deliberate about practicing than parenting, and these books have been a good practice guide for us.  We have found a full read of these three books to be very helpful to us in our work with our kids, and we have been very lucky that our main babysitter has been aligned with us on philosophy (and has been willing to read these books with us).

Book Short:  Continuing to make “sustainability” a mainstream business topic

The Big Pivot: Radically Practical Strategies for a Hotter, Scarcer, and More Open World, by my friend Andrew Winston, is a great book.  It just got awarded one of the Top 10 business books of 2014 by Strategy+Business, which is a great honor.

Andrew builds nicely on his first book, Green to Gold:  How Smart Companies Use Environmental Strategy to Innovate, Create Value, and Build Competitive Advantage (post, book link) (and second book, which I didn’t review, Green Recovery), as I said in my review of Green to Gold, to bring:

the theoretical and scientific to the practical and treat sustainability as the corporate world must treat it in order to adopt it as a mainstream practice — as a driver of capitalistic profit and competitive advantage.

Andrew’s central thesis, with plenty of proof points in the book for our planet of 7 Billion people, rapidly heading to 9-10 Billion, is this:

Whether you take a purely fiscal view of these challenges or look through a human-focused lens, one thing is clear: we’ve passed the economic tipping point. A weakening of the pillars of our planetary infrastructure— a stable climate, clean air and water, healthy biodiversity, and abundant resources— is costing business real money. It’s not some futuristic scenario and model to debate, but reality now, and it threatens our ability to sustain an expanding global economy… If this hotter, scarcer, more transparent, and unpredictable world is the new normal, then how must companies act to ensure a prosperous future for all, including themselves?

Andrew’s writing is accessible and colorful.  The book is full of useful analogies and metaphors like this one:

Climate can also seem easy to write off because the warming numbers don’t sound scary. A couple degrees warmer may sound pleasant, but we’re not really talking about going from 75 to 77 degrees Fahrenheit on a nice spring day. As many others have pointed out, the right metaphor is a fever. Take your core body temperature up one degree, and you don’t feel so great. Five degrees, and you’re sick as a dog. Ten degrees, and you’re dead.

The book also does a really nice job of looking at the externalities of climate change in a different way.  Not the usual “I can pollute, because there’s no cost to me to doing so,” but more along the lines of “If I had to pay for all the natural resources my business consumes, I would treat them differently.”

Some of Andrew’s points are good but general and maybe better made elsewhere (like the problems of short-termism on Wall Street), but overall, this book is a great think piece for all business leaders, especially in businesses that consume a lot of natural resources, around how to make the challenge of climate change work for your business, not against it.

Two things occurred to me during my read of The Big Pivot that I think are worth sharing for the people in my life who still don’t believe climate change is real or threatening.  The first is Y2K.  Remember the potentially cataclysmic circumstance where mission critical systems all around the world were going to go haywire at midnight at the turn of the millennium?  The conventional wisdom on why nothing major went wrong is that society did enough work ahead of time to prevent it, even though the outcomes weren’t clear and no one system problem alone would have been an issue.  I was thinking about this during the book…and then Andrew mentioned it explicitly towards the end.

The second is something I read several years ago in my personal news bible, The Economist.  I couldn’t find the exact quote online just now, but it was something to the effect of “Even if you don’t believe man created climate change, or that climate change is real and imperiling to humanity and can be fixed by man, the risks of climate change are so great, the potential consequences so dire, and the path to solve the problem so lengthy and complex and global…it’s worth investing in that solution now.”

Let’s all pivot towards that, shall we?  If you want to download the introduction to the book for free, you can find it on Andrew’s web site.  Or for a three-minute version of the story, you can watch this whiteboard animation on YouTube.

Book Short:  Long on Platitudes, Short on Value

I approached Success Built to Last:  Creating a Life That Matters, by Jerry Porras, Stewart Emery, and Mark Thompson, with great enthusiasm, as Porras was co-author, along with Jim Collins, of two of my favorite business books of all time, Built to Last and Good to Great. I was very disappointed in the end.  This wasn’t really a business book, despite its marketing and hype.  At best, it was a poor attempt at doing what Malcolm Gladwell just did in Outliers in attempting to zero in on the innate, learned, and environmental qualities that drive success.

The book had some reasonably good points to make and definitely some great quotes, but it was very rambly and hard to follow.  Its attempt at creating an overall framework like the one used in Built to Last and Good to Great just plain didn’t work, as two of the three legs of the stool were almost incomprehensible, or to put it more charitably, didn’t hang together well.

This isn’t a terrible book to have on your shelf, and it might be good to skim, but remember that “skim” is only one letter away from “skip.”

Book Short:  Loving the Strengths Movement More Than the Book

I’m a big believer in the so-called Strengths Movement — that we would all be better served by playing to our strengths than agonizing over fixing our weaknesses. I think it’s true both in professional and personal settings.

The books written by Marcus Buckingham that come out of Gallup’s extensive research into corporate America, First, Break All the Rules (about management) and Now, Discover Your Strengths (self-management) are both quite good.  Another book written by someone else off the same research corpus, 12: The Elements of Great Managing is ok, but not as good, as I wrote about here.

Buckingham’s newest, Go Put Your Strengths to Work: 6 Powerful Steps to Achieve Outstanding Performance, is fine and has some good points but is way too long, a little hokey, and has a lot of online companion material that is far more interesting sounding than it is actually useful.

The book does build nicely on Now, Discover Your Strengths by giving you inspiration and a framework for taking those signature themes from the prior book and translating them into action — stuff you actually do every day that plays to your strengths and draws out your weaknesses.  And that’s helpful.  Some of his suggestions for what you do with that information are ok but a bit common sense only and way too drawn out (“here’s how to talk to your boss…”).

To be fair, I am going to do some of the work that Buckingham recommended doing — so I guess that says something about the power of the book, or at least the movement underlying it.  But not the best read in the world.

Book Short:  Steve Jobs and Lessons for CEOs and Founders

First, if you work in the internet, grew up during the rise of the PC, or are an avid consumer of Apple products, read the Walter Isaacson biography of Steve Jobs (book, kindle).  It’s long but well worth it.

I know much has been written about the subject and the book, so I won’t be long or formal, but here are the things that struck me from my perspective as a founder and CEO, many taken from specific passages from the book:

• In the annals of innovation, new ideas are only part of the equation. Execution is just as important.  Man is that ever true.  I’ve come up with some ideas over the years at Return Path, but hardly a majority or even a plurality of them.  But I think of myself as innovative because I’ve led the organization to execute them.  I also think innovation has as much to do with how work gets done as it does what work gets done.

• There were some upsides to Jobs’s demanding and wounding behavior. People who were not crushed ended up being stronger. They did better work, out of both fear and an eagerness to please.  I guess that’s an upside.  But only in a dysfunctional sort of way.

• When one reporter asked him immediately afterward why the (NeXT) machine was going to be so late, Jobs replied, “It’s not late. It’s five years ahead of its time.”  Amen to that.  Sometimes product deadlines are artificial and silly.  There’s another great related quote (I forget where it’s from) that goes something like “The future is here…it’s just not evenly distributed yet.”  New releases can be about delivering the future for the first time…or about distributing it more broadly.

• People who know what they’re talking about don’t need PowerPoint.”  Amen.  See Powerpointless.

• The mark of an innovative company is not only that it comes up with new ideas first, but also that it knows how to leapfrog when it finds itself behind.  This is critical.  You can’t always be first in everything.  But ultimately, if you’re a good company, you can figure out how to recover when you’re not first.  Exhibit A:  Microsoft.

• In order to institutionalize the lessons that he and his team were learning, Jobs started an in-house center called Apple University. He hired Joel Podolny, who was dean of the Yale School of Management, to compile a series of case studies analyzing important decisions the company had made, including the switch to the Intel microprocessor and the decision to open the Apple Stores. Top executives spent time teaching the cases to new employees, so that the Apple style of decision making would be embedded in the culture.  This is one of the most emotionally intelligent things Jobs did, if you just read his actions in the book and know nothing else.  Love the style or hate it – teaching it to the company reinforces a strong and consistent culture.

• Some people say, “Give the customers what they want.” But that’s not my approach. Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, “If I’d asked customers what they wanted, they would have told me, ‘A faster horse!’” People don’t know what they want until you show it to them. That’s why I never rely on market research. Our task is to read things that are not yet on the page.  There’s always a tension between listening TO customers and innovating FOR them.  Great companies have to do both, and know when to do which.

• What drove me? I think most creative people want to express appreciation for being able to take advantage of the work that’s been done by others before us. I didn’t invent the language or mathematics I use. I make little of my own food, none of my own clothes. Everything I do depends on other members of our species and the shoulders that we stand on. And a lot of us want to contribute something back to our species and to add something to the flow. It’s about trying to express something in the only way that most of us know how—because we can’t write Bob Dylan songs or Tom Stoppard plays. We try to use the talents we do have to express our deep feelings, to show our appreciation of all the contributions that came before us, and to add something to that flow. That’s what has driven me.  This is perhaps one of the best explanations I’ve ever heard of how creativity can be applied to non-creative (e.g., most business) jobs.  I love this.

My board member Scott Weiss wrote a great post about the book as well and drew his own CEO lessons from it – also worth a read here.

Appropos of that, both Scott and I found out about Steve Jobs’ death at a Return Path Board dinner.  Fred broke the news when he saw it on his phone, and we had a moment of silence.  It was about as good a group as you can expect to be with upon hearing the news that an industry pioneer and icon has left us.  Here’s to you, Steve.  You may or may not have been a management role model, but your pursuit of perfection worked out well for your customers, and most important, you certainly had as much of an impact on society as just about anyone in business (or maybe all walks of life) that I can think of.

I enjoy reading books written by people I know. I can always picture the person narrating the book, or hear their voice saying the words, I can periodically see their personality showing through the words on the page, and books bring out so much more detail than I’d ever get from a conversation. Loved: How to Rethink Marketing for Tech Products, by Martina Lauchengco, is one of those books. Martina is an operating partner at Costanoa Venture Capital, an investor in both Return Path and Bolster, and I’d known Martina for several years before she joined Costanoa through Greg Sands. She’s the best product marketer on the planet. She’s the also one of the nicest people around.

Product Marketing is a tricky discipline. A brand marketer on my leadership team years ago referred to it somewhat derisively as a “tweener” function, one of those things that’s not quite marketing and not quite product. We didn’t get the function right for many years at Return Path because we treated it that way, thinking “well, it’s neither fish nor fowl, so we’re not quite sure what to do with it.” Then we hired Scott Roth, who has gone on to have a storied career as a multi-time CEO. Scott’s background was in product marketing. He said to me in his interview process, “Product Marketing isn’t a tweener function with no home. It’s a glue function. It holds product and marketing together.” It’s amazing how that simple change in framing, combined with great leadership, led us to completely rethink the function and make it one of the most important functions in the company.

Martina brings that to live with Loved. Simply put, Loved is a handbook or a field guide to running the Product Marketing function. I can imagine it being a section of Startup CXO in that way — it’s incredibly practical, hands-on, how-to, and rich with examples from Martina’s amazing career at Microsoft, Netscape, Silicon Valley Product Group, and Costanoa. And she believes in Agile Marketing, which is always a plus in my book (and I find rare in marketers).

Martina has lots of great frameworks and stories in the book – key responsibilities of product marketing, key metrics, the release scale, the connection to Geoffrey Moore’s TALC, strategies for messaging, pricing and packaging, and more. I won’t spoil more than one here, but I will paraphrase one that I found particularly impactful, a bit of a checklist on the essence of great product marketing:

• Share data around shifting trends in buyer behavior
• Connect your product’s purpose with broader trends
• Rebrand to make your product seem bigger than it is (and save room for expansion down the road)
• Make it free, especially if you’re defining a new category
• Share the “why” and advance access with influencers

If the measure of a book’s impact is how many pages you dog ear or highlight, this says it all about Loved.