The Hard Thing About Hard Things

1. Trust. Without trust, communication breaks. More specifically: In any human interaction, the required amount of communication is inversely proportional to the level of trust.

2. The more brains working on the hard problems, the better.

3. A good culture is like the old RIP routing protocol: Bad news travels fast; good news travels slow.

A healthy company culture encourages people to share bad news. A company that discusses its problems freely and openly can quickly solve them.

• Training starts with a golden rule: Managers must lay off their own people. They cannot pass the task to HR or to a more sadistic peer.
• Be present. Be visible. Be engaging. People want to see you. They want to see whether you care.
• Talk to people. Help them carry their things to their cars. Let them know that you appreciate their efforts.
• Taking care of the people means that your company is a good place to work.

• The first step to properly firing an executive is figuring out why you hired the wrong person for your company.
• There comes a time in every company’s life where it must fight for its life. If you find yourself running when you should be fighting, you need to ask yourself, “If our company isn’t good enough to win, then do we need to exist at all?”

Parcells: “Al, I am just not sure how we can win without so many of our best players. What should I do?”

Davis: “Bill, nobody cares, just coach your team.” That might be the best CEO advice ever.

• TAKE CARE OF THE PEOPLE, THE PRODUCTS, AND THE PROFITS—IN THAT ORDER
• When hiring executives, one should follow Colin Powell’s instructions (👇 ) and hire for strength rather than lack of weakness.

• In good organizations, people can focus on their work and have confidence that if they get their work done, good things will happen for both the company and them personally. These things make their jobs both motivating and fulfilling.
• In a poor organization, people spend much of their time fighting organizational boundaries, infighting, and broken processes. They are not even clear on what their jobs are, so there is no way to know if they are getting the job done or not.

• Technology businesses tend to be extremely complex. The underlying technology moves, the competition moves, the market moves, the people move. As a result, like playing three-dimensional chess on Star Trek, there is always a move.
• Play long enough and you might get lucky. In the technology game, tomorrow looks nothing like today. If you survive long enough to see tomorrow, it may bring you the answer that seems so impossible today.

Andy Grove said that : Training is, quite simply, one of the highest-leverage activities a manager can perform.

Two primary reasons why people quit:

1. They hated their manager; generally the employees were appalled by the lack of guidance, career development, and feedback they were receiving.
2. They weren’t learning anything: The company wasn’t investing resources in helping employees develop new skills.

Solution: An outstanding training program can address both issues head-on.

• Good product managers take full responsibility and measure themselves in terms of the success of the product. Bad product managers have lots of excuses.
• Good product managers define their job and their success. Bad product managers constantly want to be told what to do.
• Good product managers anticipate the serious product flaws and build real solutions. Bad product managers put out fires all day.

• Force them to create. Give them monthly, weekly, and even daily objectives to make sure that they produce immediately.
• Every executive must understand the product, the technology, the customers, and the market.
• Require them to bring a comprehensive set of questions about everything they heard that day but did not completely understand. Answer those questions in depth; start with first principles.

Two key techniques to be useful in minimizing politics.

1. Hire people with the right kind of ambition.(What's right kind of ambition? Read next idea👇)
2. Build strict processes for potentially political issues and do not deviate.

Certain activities attract political behavior includes:

• Performance evaluation and compensation
• Organizational design and territory
• Promotions

• As defined by Andy Grove, the right kind of ambition is ambition for the company’s success with the executive’s own success only coming as a by-product of the company’s victory.
• The wrong kind of ambition is ambition for the executive’s personal success regardless of the company’s outcome.

• The Peter Principle is a concept in which the selection of a candidate for a position is based on the candidate’s performance in their current role, rather than on abilities related to the intended role. Thus, “managers rise to the level of their incompetence.”
• The Law of Crappy People states: For any title level in a large organization, the talent on that level will eventually converge to the crappiest person with the title.

Solution: The best way to mitigate both is with a properly constructed and highly disciplined promotion process.(More about it 👇)

For example, if Jasper is the worst vice president in the company, then all of the directors will benchmark themselves against Jasper and demand promotions as soon as they reach his low level of competency.

Solution:

1. To begin, start with an extremely crisp definition not only of the responsibilities at each level but also of the skill required to perform the duties.
2. Next, define a formal process for all promotions.

• During the meeting, since it’s the employee’s meeting, the manager should do 10 percent of the talking and 90 percent of the listening. Note that this is the opposite of most one-on-ones.
• While it’s not the manager’s job to set the agenda or do the talking, the manager should try to draw the key issues out of the employee. The more introverted the employee, the more important this becomes.

• The basic idea is that people open up to feedback far more if you start by complimenting them (slice of bread number one), then you give them the difficult message (the shit), then wrap up by reminding them how much you value their strengths (slice of bread number two).
• You don’t make yourself look good by trashing someone who worked for you.

The early days of Facebook, Zuckerberg deployed a shocking motto: Move fast and break things.

Meaning: If you move fast and innovate, you will break things.

The following things that cause no trouble when you are small become big challenges as you grow:

1. Communication
2. Common knowledge
3. Decision making

Solution:

• You will need to split things into smaller subgroups.
• You may want a QA manager, for example.
• The best way to accomplish communication is to make them report to the same manager.

• Focus on the output first. What should the process produce? In the case of the interview process, an outstanding employee. If that’s the goal, what’s the process to get there?
• Two core skills for running an organization: First, knowing what to do. Second, getting the company to do what you know.
• Note: It’s a good idea to ask, “What am I not doing?”

When someone learns to drive a race car, one of the first lessons taught is that when you are going around a curve at 200 mph, do not focus on the wall; focus on the road. If you focus on the wall, you will drive right into it. If you focus on the road, you will follow the road. Running a company is like that. There are always a thousand things that can go wrong and sink the ship. If you focus too much on them, you will drive yourself nuts and likely crash your company.

1. The ability to articulate the vision
2. The right kind of ambition
3. The ability to achieve the vision

Truly great leaders create an environment where the employees feel that the CEO cares more about the employees than she cares about herself. In this kind of environment, an amazing thing happens: A huge number of employees believe it’s their company and behave accordingly.

• FIRST RULE OF ENTREPRENEURSHIP: THERE ARE NO RULES
• FEEDBACK IS A DIALOGUE, NOT A MONOLOGUE
• If you don’t like choosing between horrible and cataclysmic, don’t become CEO.
• People who watch you judge you on what you do, not how you feel.
• Be careful with “he said, she said”
• Embrace the struggle.

Very early on, Jeff Bezos envisioned a company that made money by delivering value to rather than extracting value from its customers. In order to do that, he wanted to be both the price leader and customer service leader. You can’t do that if you waste a lot of money. He decided to build frugality into his culture. All desks at Amazon.com would be built by buying cheap doors from Home Depot and nailing legs to them. Why? “We look for every opportunity to save money so that we can deliver the best products for the lowest cost.”

• Peacetime in business means those times when a company has a large advantage over the competition in its core market, and its market is growing. In times of peace, the company can focus on expanding the market and reinforcing the company’s strengths.
• In wartime, a company is fending off an imminent existential threat. Such a threat can come from a wide range of sources, including competition, dramatic macroeconomic change, market change, supply chain change, and so forth.

• Peacetime CEO spends time defining the culture. Wartime CEO lets the war define the culture.
• Peacetime CEO knows what to do with a big advantage. Wartime CEO is paranoid.
• Peacetime CEO thinks of the competition as other ships in a big ocean that may never engage. Wartime CEO thinks the competition is sneaking into her house and trying to kidnap her children
• Peacetime CEO aims to expand the market. Wartime CEO aims to win the market.

The judgment that you have to make is,

(a) Is this market really much bigger (more than an order of magnitude) than has been exploited to date? and

(b) Are we going to be number one?

If the answer to either (a) or (b) is no, then you should consider selling.

If the answers to both are yes, then selling would mean selling yourself and your employees short.

A company without a story is usually a company without a strategy. Want to see a great company story? Read Jeff Bezos’s three-page letter he wrote to shareholders in 1997. In telling Amazon’s story in this extended form—not as a mission statement, not as a tagline—Jeff got all the people who mattered on the same page as to what Amazon was about.