Book Short:  Unsung Heroes

If you like “entrepreneurship by analogy” books, you’ll like The Innovators:  The Engineering Pioneers Who Made America Modern, by David Billington.  I have to admit some bias here — Professor Billington was my favorite teacher and senior thesis advisor at Princeton (I almost majored in civil engineering because of him), and this book is one of a number he’s written that are outgrowths of his most popular courses at Princeton.  And while there’s no substitute for the length or energy of his lectures, the book works.

The book is basically a person-focused engineering history of America from 1776-1883.  Billington talks about four classes of engineering product:  public structures (mostly bridges), machines that produced power, networks like the railroads and telegraphs, and processes like steel manufacturing.

His approach is to acknowledge that the Americans innovators couldn’t do much without the right context:  learnings from their counterparts in Britain, a supportive government here at home, and abundant raw materials and capital.  But with that backdrop in place, Billington tells the tale of a number of the inventions that built our modern society with a focus on the engineers who got things right.  While some of them are familiar names (Morse, Edison), many are not (Thomas Telford, J. Edgar Thomson, Joseph Henry).

Sound familiar?  It feels at many point in the book that you could insert some different names and dates and be reading a history of the Internet or information age.  And as with the Industrial Revolution, while many of the innovators in our world today are known (Bezos, Yang, Brin/Page), there are probably an equal number who are unsung heroes — either software engineers or even buisness model pioneers who haven’t sought or won’t end up in the spotlight even though their contributions to society or to their companies are giant.  I know there are a number of unsung heroes in our own engineering department at Return Path — people who aren’t market facing and who never get quoted in press releases, but who really make a difference in how the company works and how competitive we are.  This book celebrates those people as much as it does the entrepreneurs you’ve heard of.

Warning, there are lots of pages which are full of mathematical formulas, which may or may not be interesting to you, but the book still holds together 100% if you skip over them.

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.

Book Short: A Marketing-Led Turnaround

Generally, I love books by practitioners even more than those by academics.  That’s why Steve McKee’s first (I assume) book, When Growth Stalls:  How it Happens, Why You’re Stuck, and What to do About It (book, Kindle edition) appealed to me right out of the gate.  The author is CEO of a mid-size agency and a prior Inc. 500 winner who has experienced the problem firsthand – then went out, researched it, and wrote about it.  As a two-time Inc. 500 winner ourselves, Return Path has also struggled with keeping the growth flames burning over the years, so I was eager to dig into the research.  The title also grabbed my attention, as there are few if any business books really geared at growth stage companies.

I’d say the book was “solid” in the end, not spectacular.  Overall, it felt very consistent with a lot of other business books I’ve read over the years, from Trout & Reis to Lencioni to Collins, which is good. The first half of the book, describing the reasons why growth stalls, was quite good and very multi-faceted.  His labeling description of “market tectonics” is vivid and well done.  He gets into management and leadership failings around both focus and consensus, all true.  Perhaps his most poignant cause of stalls in growth is what he calls “loss of nerve,” which is a brilliant way of capturing the tendence of weak leadership when times get tough to play defense instead of offense.

The problem with the book in the end is that the second section, which is the “how to reverse the stall” section, is way too focused on marketing.  That can be the problem with a specialty practitioner writing a general business book.  What’s in the books makes a lot of sense about going back to ground zero on positioning, market and target customer definition and understanding, and the like.  But reversing the stall of company can and usually must involve lots of the other same facets that are documented in the first half of the book — and some other things as well, like aggressive change management and internal communication, systems and process changes, financial work, etc.

At any rate, if you are in a company where growth is stalling, it’s certainly a good read and worth your time, as what’s in it is good (it’s what’s missing that tempers my enthusiasm for it).  In this same category, I’d also strongly recommend Confidence:  How Winning Streaks and Losing Streaks Begin and End, by Rosabeth Moss Kanter, 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.

Book Short:  Way, Way Beyond Books

The Everything Store: Jeff Bezos and the Age of Amazon, by Brad Stone, was a great read.  Amazon is a fascinating, and phenomenally successful company, and Jeff is a legendary technology leader.  The Everything Store is a company and personal biography and totally delivers.

Forget about the fact that Amazon is now almost $100B in revenues and still growing like mad.  I find it even more amazing that a single company could be the largest ecommerce site on the planet while successfully pioneering both cloud computing services and e-readers.  The stories of all these things are in the book.

As a CEO, I enjoyed reading more of the vignettes behind the things that Amazon is reputationally known for in the tech world – doors as desks, their unique meeting formats, the toughness of the culture, the extensive risk taking of growth over profits, and what works and does not work about Bezos’ authoritative and domineering style.  And it’s always great to be reminded that even the biggest and best companies had to cheat death 10 times over before “arriving.”

This is good fun and learning for anyone in the business world.  It reminded me most of Walter Isaacson’s biography of Steve Jobs ,which I wrote about here, although it’s more of a company history and less of a biography than the Jobs book.

5 Ways to Get Your Staff on the Same Page

[This post first appeared as an article in Entrepreneur Magazine as part of a new series I’m publishing there in conjunction with my book, Startup CEO:  A Field Guide to Scaling Up Your Business]

When a major issue arises, is everybody at your company serving the same interests? Or is one person serving the engineering team, another person serving the sales team, one board member serving the VC fund, another serving the early-stage “angels” and another serving the CEO? If that’s the case, then your team is misaligned. No individual department’s interests are as important as the company’s.

To align everyone behind your company’s interests, you must first define and communicate those goals and needs. This requires five steps:

1. Define the mission. Be clear to everyone about where you’re going and how you’re going to get there (in keeping with your values).
2. Set annual priorities, goals, and targets. Turn the broader mission into something more concrete with prioritized goals and unambiguous success metrics.
3. Encourage bottom-up planning. You and your executive team need to set the major strategic goals for the company, but team members should design their own path to contribution. Just be sure that you or their managers check in with them to assure that they remain in synch with the company’s goals.
4. Facilitate the transparent flow of information and rigorous debate. To help people calibrate the success, or insufficiency, of their efforts, be transparent about how the organization is doing along the way. Your organization will make better decisions when everyone has what they need to have frank conversations and then make well-informed decisions.
5. Ensure that compensation supports alignment (or at least doesn’t fight it). As selfless as you want your employees to be, they’ll always prioritize their interests over the company’s. If those interests are aligned – especially when it comes to compensation – this reality of human nature simply won’t be a problem.

Taken in sequence, these steps are the formula for alignment. But if I had to single out one as the most important, it would be number 5: aligning individual incentives with companywide goals.

It’s always great to hear people say that they’d do their jobs even if they weren’t paid to, but the reality of post-lottery-jackpot job retention rates suggests otherwise. You, and every member of your team, “work” for pay. Whatever the details of your compensation plan, it’s crucial that it aligns your entire team behind the company’s best interests.

Don’t reward marketers for hitting marketing milestones while rewarding engineers to hit product milestones and back office personnel to keep the infrastructure humming. Reward everybody when the company hits its milestones.

The results of this system can be extraordinary:

• Department goals are in alignment with overall company goals. “Hitting product goals” shouldn’t matter unless those goals serve the overall health of your company. When every member of your executive team – including your CTO – is rewarded for the latter, it’s much easier to set goals as a company. There are no competing priorities: the only priority is serving the annual goals.
• Individual success metrics are in alignment with overall company success metrics. The one place where all companies probably have alignment between corporate and departmental goals is in sales. The success metrics that your sales team uses can’t be that far off from your overall goals for the company. With a unified incentive plan, you can bring every department into the same degree of alignment. Imagine your general counsel asking for less extraneous legal review in order to cut costs
• Resource allocation serves the company, rather than individual silos. If a department with its own compensation plan hits its (unique) metrics early, members of that team have no incentive to pitch in elsewhere; their bonuses are secure. But if everyone’s incentive depends on the entire company’s performance, get ready to watch product leads offering to share developers, unprompted.

This approach can only be taken so far: I can’t imagine an incentive system that doesn’t reward salespeople for individual performance. And while everyone benefits when things go well, if your company misses its goals, nobody should have occasion to celebrate. Everybody gets dinged if the company doesn’t meet its goals, no matter how well they or their departments performed. It’s a tough pill to swallow, but it also important preventive medicine.

Book Short:  Which Runs Faster, You or Your Company?

Leading at the Speed of Growth, by Katherine Catlin at the Kauffman Center for Entrepreneurial Leadership is a must read for any entrepreneur or CEO of a growth company.  It’s one of the best books I’ve ever read targeted to that audience – its content is great, its format is a page-turner, and it’s concise and to the point.

The authors take you through three stages of a growth company’s lifestyle (Initial Growth, Rapid Growth, and Continuous Growth) and describe the “how to’s” of the transition into each stage:  how you know it’s coming, how to behave in the new stage, how to leave the old stage behind.

I didn’t realize it when I started reading the book, but Brad had one of the quotes on the back cover that says it all:  “There are business books about starting a company, but they tend to deal with the mechanics of business plans and financing.  Then there are books about ‘how to be the CEO of a Fortune 500 company.’  This is the first book I’ve seen that details the role of the CEO of a small but growing company.”  Thanks to my colleague George Bilbrey for pointing this one out to me.

UPDATE:  Brad corrects me and says that I should mention Jana Matthews, who co-wrote the book with Katherine Catlin and is actually the Kauffman Center person of the duo.

Book Short:  Crazy Eights

In honor of Return Path being in the midst of its eighth year, I recently read a pair of books with 8 in the title (ok, I would have read them anyway, but that made for a convenient criterion when selecting out of my very large “to read” pile).

Ram Charan’s latest, Know-How:  The 8 Skills That Separate People People Who Perform From Those Who Don’t, was pretty good and classic Charan.  Quick, easy to skim and still get the main points.  The book lost a little credibility with me when Charan lionized Verizon (perhaps he uses a different carrier himself) and Bob Nardelli (the book was published before Nardelli’s high profile dismissal), but makes good points nonetheless.  Some of the 8 Skills he talks about are what you’d expect on the soft side of leadership — building the team, understanding the social system, judging people — but his best examples were particularly actionable around positioning, goal setting, and setting priorities.  The book reminded me much more of Execution and much less of Confronting Reality (which is a good thing).

For years I’ve felt like the last person around to still not have read The 7 Habits of Highly Effective People, so I thought I’d skip straight to the punchline and read Stephen Covey’s newer book, The 8th Habit:  From Effectiveness to Greatness.  Fortunately, as I’d hoped, the new book summarizes the prior book several times over, so if you haven’t read the first, you could certainly just start with this one.  The book also comes with a DVD of 16 short films, some of which are great — both inspirational and poignant.  Unlike most business books, the 8th Habit is NOT skimmable.  It almost has too much material in it and could probably be read multiple times or at least in smaller pieces.  The actual 8th habit Covey talks about is what he calls Find Your Voice and Help Others Find Their Voices and is a great encapsulation of what leading a knowledge worker business is all about.  But the book is much deeper and richer than that in its many models and frameworks and examples/tie-ins to business and goes beyond the “touchy feely” into hard-nosed topics around execution and strategy.

Now I’m looking for the DVD of the first season of Eight is Enough!

Book Short:  Like a Prequel to My Book

How to Start a Business, by Jason Nazar, CEO of our client Docstoc, is a great and quick (and free) eBook that feels a lot like a prequel to my book Startup CEO:  A Field Guide to Scaling Up Your Business (original outline here). My book is about scaling a business once you’ve started it.  Jason’s book is a really practical guide to starting it in the first place.

The thing that’s particularly good about this book is that it’s as much a resource guide as it is a book.  At the end of each of its 24 chapters (and within them as well), Jason adds a series of external links to other resources, from videos to checklists to templates.  The book answers a lot of really practical questions that are easy for product-focused entrepreneurs to gloss over or ignore, from corporate structures to insurance, from trademark registration to pitching VCs, from payroll to tax planning.

It’s great to see so much more being written for entrepreneurs these days.  Ash Maurya’s Running Lean: Iterate from Plan A to a Plan That Works (which I blogged about last week) is another related book that focuses on how to bring a new product to market.  But Jason’s eBook is a must read for anyone in TechStars or any accelerator program, or anyone contemplating starting a business.

Book Short:  Best Book Ever

The Hard Thing About Hard Things, by Ben Horowitz, is the best business book I’ve ever read.  Or at least the best book on management and leadership that I’ve ever read.  Period.

It’s certainly the best CEO book on the market.  It’s about 1000 times better than my book although my book is intended to be different in several ways.  I suppose they’re complementary, but if you only had time left on this planet for one book, read Ben’s first.

I’m not even going to get into specifics on it, other than that Ben does a great job of telling the LoudCloud/Opsware story in a way that shows the grit, psychology, and pain of being an entrepreneur in a way that, for me, has previously only existed in my head.

Just go buy and read the book.

Book Short: Plain Talk

An HR rock star I met with recently told me that “You can say anything you want to your people, as long as it’s true,” which of course is great advice.  Plain Talk: Lessons from a Business Maverick (book, kindle), by Ken Iverson, the long-time CEO of Nucor, pretty much embodies that.  If you’re not familiar with Nucor, it’s a steel company – right, steel – and the most successful one of the last 50-75 years, at that.  You may think an industrial company like this offers no lessons for you.  If so, you are wrong.

The reason Nucor has been so successful, if you believe their long time leader, is that they run the people side of their business differently than most companies like them.  Reading this book from the perspective of a knowledge worker business CEO was particularly interesting, since I had to transform my frame of reference a bit (and do a little mental time travel as well) in order to understand just how revolutionary Nucor’s practices were at the time.

But then I realized – they’re still revolutionary today.  How many companies – even the most progressive ones – don’t have performance reviews because they don’t need them in order to create a high performing environment?  Companies that spend a good percentage of their time and energies thinking about how to get their employees to do their best work, as opposed to focusing only on the goals of the business, do better than those who don’t.  It doesn’t matter what industry you’re in.  As Patrick Lencioni would say, you can outbehave the competition.

Plain Talk is a really short book, and a good, authentic read if you’re a leader who cares about your people and wants to learn a few nuggets here and there from one of the 20^th century masters of that discipline.  Anyone that can link a high degree of delegation to authority has a story worth telling.