“We don’t make movies to make money;
We make money to make movies.” – Walt Disney
Techies are usually the ones who start companies. There’s a big problem with that…we techies (I’m one of them) love our technology too much. That love of technology and the realities of business — developing viable products; selling, selling, selling; staying on budget and on schedule; surviving to fight another day — frequently don’t go well together.
I’ve seen it time and again, we let our love for the technology get in the way of making sound, logical, calculated business decisions. If you think this doesn’t apply to you because you’re not on the leadership team, think again…the same holds true for the engineers working in the trenches as they make their product design and development decisions. Being in love with your technology leads to bloatware, unnecessarily complex designs, distracting features, and the associated schedule delays and cost overruns. Keep it simple, stupid (K.I.S.S.)
I saw a classic example in one company I worked with. A brilliant inventor came up with a new idea. The team developed it into a commercial product, which was DOA because its cost was 80% higher than the existing commercial products…and the customers were only willing to pay 25% more for the solutions the new technology provided. The inventor and the team had sold themselves on the technology, so they modified the product for military use. The technology solved even more problems for the military, but even they weren’t able to pay the cost premium. The team finally decided on a two-pronged approach: they’d use their patented technology for niche applications and long-term product ideas but would use the industry-standard technology for their “bread and butter” products.
This company built a decent, recurring revenue-generating, profitable business using industry-standard products, combined with a few niche plays using the new technology. Despite these business successes, the inventor’s impression was incredibly negative. He felt that the team had “abandoned” his idea and gone down the wrong path by using an “inferior” solution. He ignored the important fact that the profits from the standard products allowed the company to grow its research team. He also overlooked the fact that having real products out in the field — instead of continuing to slave away in the lab — taught the company invaluable lessons, allowed it to hire a manufacturing team, and attracted additional customers. The inventor had difficulty accepting that revenues, profits, and viable products had to come first before the company could afford to take additional risks with its new technology. You need to make money to make movies.
This behavior doesn’t surprise me. People who invent something new, especially something that goes against a conventional approach, face huge hurdles in gaining acceptance. Skeptics repeatedly tell them their baby is ugly. They have to develop thick skin. They spend years telling themselves that their solution is the best for certain applications. At some point, however, they risk making the leap in logic that they have a solution for every customer problem. “When all you have is a hammer, everything looks like a nail.” This perspective, combined with mental toughness, ends up getting in the way of sound business decisions.
Not only do techies love their technology, but we love the scientific method. We love questioning, debating, analyzing, and playing devil’s advocate. Sometimes, unfortunately, we’ll do that right when the sales guy is near the end of a sales cycle and the customer is reaching for his wallet. For the sake of argument, we might mention that one technical risk that only has a 2% chance of actually occurring…and we’ll kill the deal. We think too much. PhD’s, in particular, are accustomed to the pontificating of academia. We’re thinkers who have lots of ideas and long-term vision but might be short on execution. In my first company there were four co-founders, all fresh out of school. We thought the best way to work together was to debate until we had some consensus. WRONG! The best way to make progress is to have someone make a freakin’ decision, have everyone charge forward in the same direction, expect that half of your decisions will be wrong, and to be OK with that because you can quickly learn from your mistakes and pivot in the right direction.
Another reason techies struggle with cold business logic is because we can’t get it through our thick skulls that “better” is the enemy of “good enough.” Even after the product is done, we love “polishing” it. If someone else wrote the code, we think we have a better way of doing it, so we’re tempted to rewrite it from scratch. We give this process a fancy name — “refactoring the code” — in order to bewilder inexperienced project managers. For an excellent lesson-learned from Netscape on why you should never start something from scratch, read this article.
What Treatment is Available?
We need to remind techies that in order to keep playing with their toys, the company first and foremost needs to make money to keep making movies. How do we do that? Three simple steps:
- Set Immovable Deadlines – Define deadlines based on the resources you have, and then make the deadlines absolutely immovable. Be aggressive in de-scoping your projects in order to eliminate the fat. Make there be hell to pay if a deadline is missed and celebrate the small victories when the deadline is hit.
- Provide Financial Insight – I think startups have too much internal secrecy surrounding their financials. This decouples engineering performance from the company’s financial performance. Management should set revenue through an operations plan at the beginning of the year, share the financial forecasts with the team and update the team on a regular basis, and show how delays impact the bonus pool in a real way.
- Discourage Professorships – Foster a culture biased towards action. Cut debates short. Don’t let meetings last longer than an hour. Make sure someone has the authority to make executive decisions and that they’re competent. Tell people who come asking for approval to JFDI.
That didn’t work…what else can I try?
Keeping a team of engineers focused is a full-time job — it’s the reason for project managers, who are worth their weight in gold if they do their job well. Here are some other mechanisms that can help. (As I write more about these, I’ll link the articles.)
- Have engineers interact with the real world. Send them to conferences and customer meetings. It’ll make them realize that (a) the competition isn’t standing still and (b) the customers really only care about price and a couple of key features, not the kitchen sink.
- Create small, focused teams and give them budget authority. Matrixed organizations create chaos…avoid them.
- Track project spending vs. actual milestone completion.
- Create a “parking lot” for good ideas so that they don’t become distracting tangents.
- Don’t over-specify. Figure out what the customer really needs and have everyone focus on that. Big specs can easily become distractions and make-work exercises.
- Celebrate small victories.
- Exercise management by walking around (MBWA) in order to keep your finger on the pulse of the engineering team and correct people going down a tangent.
- Reward on-time delivery.
- Get expert input to prevent engineers from re-inventing the wheel.
- Do weekly company-wide demos of people’s work. Peer pressure and interim milestones are wonderful motivators.
- Implement agile development, especially scrum.
Remember what Motivates Us
Nobody wants to waste time. Everybody wants a sense of accomplishment. Nobody wants to toil on useless features. Everybody wants to see their products released into the wild. Unfortunately, there are countless distractions along the way…distractions that make us lose sight of what the customer actually wants.
As you get closer to your product release date, remind your techies that “we don’t make movies to make money; we make money to make movies.” The customers are the ones who pay the bills…and the bills are what allow them to continue developing cool, new technologies. Or, in the words of Walt Disney’s Mickey back in 1928.
This is it guys, when these doors open, we got to make a very first impression.
…and it better be a good one.