Lecture 14: How to operate with Keith Rabios
Building a company is like building an engine, and you are the architect. On paper it looks pretty, but in reality, you are holding it together with duck tape. The polished metal that completes it has not been put into place yet.
Eventually, you want to have something that no one has to worry about every minute of the day. Rabios jokes that if Martians were to ever take over eBay it would take the world six months to notice. You want a system that can produce results without having employees monitoring it around the clock.
Invest in business any idiot could run because someday one will? Peter Lynch
You should constantly be measuring your employees. Only measure progress, focus on the output and not on the input.
Andy Groves Mangers output equation:
Output of organization
Output of neighboring organizations
- When you first start a company, it will feel like a mess.
Like a cold this feeling will go away. But just like the being in the emergency room if diagnosed wrong, the feeling could be fatal.
An editor is the best metaphor to use when describing your job description. Your employees are the writers. Like when you write any paper, the first thing an editor does it strike up the paper with red ink simplifying and eliminating anything to clarify what is being said. The more you simplify the easier it will be for your team to understand the framework and repeat the process.Dont accept the excuse of complexity. Sometimes people say something is too complicated. They are wrong. You can market and build ideas within a few simple words.
The second job you have as an editor is to clarify all the information. Once you submit a document a lot of people will ask what the meaning behind your words are. Make a list of the top four things that actually matter to the company. This will allow your team to focus on building up the company and not become distracted by unimportant things.
- Allocate Resources
Recruit editors (hires) from other places to bring competition to your company. You can always relocate or send them somewhere else but the goal overtime is to use less red ink everyday.
- Ensure a Consistent Voice
Make it feel like everything your company says or does is all by one person. Any recruitment pages or social media accounts should have the same flow and feel. You want everyone in the company to understand and be able to produce the voice themselves.
- Delegating Tasks
Like in your company, writers are doing more work that the editors. As the owner you shouldnt be responsible for doing all of the work.
Some find the issue with delegating tasks is the responsibility that comes along with it. When you assign an employee a task you then become responsible for the work they are completing. To successfully delegate work you can follow the Task Relevant Maturityscale.
If their task maturity level is low their task will be highly structured knowing what, when, and how, the employee is doing with their tasks. If their maturity level is high you will simply monitor them and set objectives.
The more someone has completed the task the more you trust them and less you have to monitor making to easier to focus on other tasks at hand. Look at their level of conviction, what can they handle? Ask references from previous companies what tasks they were able to handle in the past.
If your employee has a high level of conviction step in, decide, and overrule of necessary. If your employee has a lower level of conviction, delegate them fully. If you are ever unsure of your own opinion then delegate them as well! People make mistakes let them learn from them.
7. Maximize probability of success for team
The Barrel and Ammunition
Sometimes when you hire more you find less work getting done. This is because most great people are ammunition. What your company needs are barrels. Barrels are stocked with ammunition. If you have one great barrel then your company will continue to find more.
If you find an employee who is a barrel keep them! Give them equity and promote them, they are cultural specific and hard to find!
How do you find a barrel?
Begin by giving them a small set of responsibilities and rewards.
Ex: Someone who stays late vs. someone who doesnt. Slowly expand the scope of responsibilities till it breaks. It eventually does and you will see the level of work they are able to handle.
When do you hire someone who is above you?
Look at the growth rate of the company compared to employee growth rate
Everyone has his or her own individual growth rate. If someone has the same learning curve as the company then promote them at the same rate of the companys growth.
- Insist on Focus
People feel insulted when they are asked to perform only one task. Insist they focus on only tasks they were delegated to. Conquer the one task at hand for best outcome.
- Metrics and Transparency
Metrics: Create tools that enable people to make decision on the same level you would. Build a dashboard simplifying the metrics of success. Draw out what the key components are for success of the company and write down what tasks are being delegating and who is completing them. This will keep everyone on the same page at all times.
Transparency: After metrics comes transparency. Everyone should have access to the material and be able to easily know what is going on. Not everyone is invited to every meeting so assign someone to take notes to send out to all employees. Everyone will be able to track and monitor was is going on and never feel excluded.
Tip: Having glass walls is a good idea! People tend to worry less about what is being send or going on inside.