After some self-funded testing, I founded Circles Learning Labs, Inc. in April, 2017. Enormous thanks to the friends and co-believers who invested $2MM in our seed round, and to those who have given their time as advisors. As we hit the early market, one part of the vision proved hard and another got rave reviews. We didn’t have the scale to source and match peers into groups from the open Internet that would stick, so we stopped working on that. But when companies and communities sent us people, it worked. Our nascent video room, with a few basic processes and features inspired by the forum/peer group world, consistently produced deep conversations, continual learning, and circles of people that loved being together. By going to where people already gathered, attendance went from 65% to 95+%. Our business moved from getting everyone into forums to bringing forum practices to everyone.

I think the early job of a startup is to distill an idea to the essence that solves a customer need. In hindsight, chasing that feeling I referenced in the opening paragraph, when people groove together and make music, lay underneath everything we were doing all along. When was the last time you were in a circle of people that felt like that? What if teams felt like that? Learning? This connected my past work on culture, early experiments in learning like Battle of the Bands, my eye-opening Henry Crown Fellowship, and the growth I experienced in EO and YPO forums.

Our startup is making it easy for small groups to become circles that learn, grow and work together. Members of a circle share openly and count on each other. They groove. Too many teams don’t, but they could! The fact that our peers are distributed makes it harder, sure, but it also allows us to inject technology. Circles can take many forms, like a forum of peers, a work team, or a study group. They share an ability to have deep conversations and a high level of trust that leads to breakthroughs. The importance of this work is nicely summed up by this classic Margaret Mead quote, “Never underestimate the power of a few committed people to change the world. Indeed, it is the only way.”​

15 years ago today, “The Matrix” opened.  I had recently moved to Hong Kong, and to ease the cultural shock, I think I paid to see it in theatre five times.  I love that movie. Thinking about it makes me want to start wearing tight-fitting black latex suits.

I now know that humans actually would not work as batteries. 

Nevermind, the matrix contains three of my favorite ideas.  I know, I know, they aren’t original to The Matrix.  But, they are still great ideas, so I was inspired to write them down in tribute.

• I know kung fu
• There is no spoon
• Beat the machines

What I mean is:

Neo learns all the martial arts techniques in an instant.  Is it possible?  Reading pop neuroscience, like The Talent Code, certainly makes me feel like we're getting closer. After that, all he needs is Laurence Fishburne to work through his mental blocks. “Do you really think that’s air you are breathing?  Bring it.”  Oh, and a little practice actually doing it.  This isn’t far from what Khan Academy, and many others, are doing when they talk about - “flipping the classroom.”  What is usually done in class should be the homework, and vice-versa. Review the material using short videos (or ultimately with media jacked right into your head automatically building myelin-sheaths in your brain).  Then work on the practice in a group, with peers and with coaches.

Words are malleable.  If reality is just made of words, can’t we change reality?  The kiddie buddha in the matrix is just saying what so many others have said - the most powerful path to changing reality is to change yourself.  Josh Waitzkin calls this “making sandals, not paving the road.” It is  the first and foundational habit of Stephen Covey’s seven, and I still remember him talking about how this gets you through life in a concentration camp.  Power lies in our taking control of how we react to outside stimulus.

I used to run a training series at work called “there is no spoon.”  Does anyone want to buy a phone system from us? From anyone?  Hell, no.  No one wants a phone system.  They want happy customers, revenues, etc.  Work with that.  There is no phone system.  Could you have turned that angry customer into a fan?  Closed that deal?  Always, if your words were good enough. (Well, almost always).  Dig deeper, grasshopper.

Beat the Machines.  This is the subject of so much great science fiction.  Star Wars, Battlestar Galactica (best TV show ever - the remake), and The Matrix.  It is a core issue in modern life:  We create television, and then it eats four hours of average everyone’s day.  We create email, then fight its addiction.  Carbon emissions.  Nukes.  (Oy, do we really have to worry about Russia nuking us again? That was so 1982.)  

"There is No Spoon" -- we can make our reality.  "I Know Kung-Fu" is how. And this ability to create is the stuff that is uniquely human.  The stuff that machines can't do.  After all, we make lousy batteries.

The story became company legend.  Our CTO, let’s call him “Eric,” interrupted band practice to check a developer's status on an important project.  Getting a lukewarm response, Eric shot back, “Is band practice really your highest priority now?”  After he left, the group realized they had found their band name - “Is This My Highest Priority?” They went on to win the first battle of the bands with an electrifying rendition of “Seven Nation Army.”  Inc. magazine published a photo of them practicing above their article on the program.

In my experience, Eric’s skepticism is the norm.

Knowledge acquisition is mostly an afterthought at work.  Managers relegate learning programs to the province of HR, where executives have other priorities, like compliance or making the workplace equitable.  Some companies run, “Welcome to your new job” boot camps, but learning curves are most often viewed as a one-shot climb.  And most staff see themselves as educated - past tense.

How high should learning be on the priority list? 

It would be nice if we could start out with a model that compares the ROI of learning programs to prioritize them against other projects.  So I bought Josh Bersin’s “The Training Measurement Book.”  I’ll save you the read. You really can’t.  

Bersin surveyed 136 big company training departments and found that only 5% measure ROI of their programs, and 8% measure “actual business impact.”  Why?  First of all, it is hard to isolate training’s impact, given all the other external factors.  Also, the returns usually come out preposterously large - “far higher than most organizations can compute.”  Try measuring the ROI for sales training.  I did, using M5's numbers for junior sales reps, average sales, churn and discount rate on the recurring revenue booked.  I assumed an expensive training program for a team of 20, in which they all spend a full hour a day for a year learning, supported by 1/2 of a full-time trainer.  If the program’s impact after a year is a 5% improvement in revenue, you get a 274% return on investment.  Off the charts.

The reason that learning often doesn't get top billing, isn’t only that it is hard to compare to other initiatives.  We don't trust learning programs to work.  That’s our experience on the ground, usually.  We tend to read books and forget them.  Or an inspiring speaker gives us a buzz, but in a few days we realize we can’t actually do any of what she said. We usually give up on our commitments to practice a little each day.  And our paradigm for learning is school, which hasn't changed much from the one-size fits all lecture + test based model.  According to the Conference Executive Board, "Corporations spend an estimated $145 billion annually on training initiatives, but more than half of those dollars fail to result in tangible returns.“

So not only are the benefits fuzzy, the path to achieve them is uncertain.  This keeps learning below other tasks on the priority list.

This will change. The benefits of learning are increasing.  We’re now in a knowledge economy that values good ideas and decisions more than cranking out more units faster. Networked computers amplify and multiply the skills of any one person in a company.  

Plus, we are learning how to learn faster, better, and with more predictable results.  New EdTech companies are funded every day.  Tim Ferriss is experimenting with how to learn whole languages in a week.  Stikk reports that using its portal to setup stakes, referees, and supporters massively improves odds of succeeding with personal change goals.  Companies like Udemy, Lynda, Udacity, and Coursera  are throwing up tons of quality course content online, enabling a “flipping” of the learning experience that uses everyone’s time better.   Skillshare, Everwise, Curious,  and many others are facilitating learner-teacher matches quickly.  And neuroscience is teaching us a lot about how to rewire the brain, shedding light on how most programs are simply too wimpy and don’t include the practices (like practicing) you really need to make a lasting change.  

Some leaders have made a major mark with learning programs.  CDW’s founder, Michael Krasny, once told me that every dollar he put into training came back in multiples. As David Kaplan tells the story in Verne Harnish’s, “The Greatest Business Decisions of All Time,” soon after becoming CEO Jack Welch invested heavily in GE’s Crotonville learning center while firing 100,000 people. His Board presentation described “infinite” ROI.  Verne also points out that Steve Job’s top priority during his last two years was building Apple University.

At M5, Eric and the other skeptics came around.  Every minute in the band room was returned, plus interest, with additional energy and engagement from staff.  And for every person we had skilled up that left the company, we hired two talented replacements attracted by our learning culture and promoted three from within, avoiding recruiting altogether.  Not to mention the benefits of improving teamwork and reinforcing our learning culture.

Learning is moving rapidly up the priority list both for companies and individuals.   I love it.  It makes work more fun.  It energizes and accelerates people and organizations.  

Besides, our species had better start getting better faster or else robots will surpass us, ushering in "The Singularity" ... 

“Most businesses take care of their shareholders first.  We strongly believed it was employees first ..." - Barbara Anderson

I recently spoke with Barbara Anderson, one of the first employees and a leader at the The Container Store for over thirty years. This company has been a favorite for a long time, partly because they invest 263 hours for each full-time employee's education. This was my first conversation with a founding exec, and I thought I’d write it up.

Check out the wikipedia overview if you don’t know them. The Container Store, which invented a retail category, opened in 1978 and has grown steadily at 22.4%+ annual compounded growth rate to 63 stores today.  Barbara told one story that underscored their success. After selling to retail-focused PE Leonard Green in 2007, The Container Store was the only portfolio company to stay in the black and not downsize during the Great Recession.  They are a great proof point in the power of investing in people as a competitive advantage.

The conversation underscored a few business design principles I believe in:

Learning sells.   The Container Store's emphasis on learning came out of sales. In 1978, the only "containers" were marketed for commercial use, and The Container Store's innovation was to match these existing products to applications at home.  Upon reflection, I think M5’s learning culture had similar origins. Phone systems and networks had thousands of features and our sales people had to figure out how to match them to business problems.  This was real value-added sales.  I love the quote,  “Teaching is the highest form of selling.”

There is no HR.  The Container Store has no HR department!  Managers are responsible.  M5 outsourced HR until hitting 100 employees, and kept it lean and focused on admin and recruiting after that. I had a direct report run Learning as chief learning officer.

You can only grow the right people.  Barbara ran into something that also hurt me.  When you’re an employee first company and you are also a growth company you have to balance efforts to grow and develop people with a culture of gracious accountability, so great people understand that they either need to step up or move on.   In other words, you can be slow to fire.  Eventually, Barbara helped develop an innovative performance review system to help get through this conundrum and establish a more effective balance.

Staff need to know the score.  Flow is an excellent old book that lays out the aspects of achieving a “Flow State” in an activity, commonly called “The Zone” in sports. I love this theory of happiness, and speculate that it can be used to great competitive advantage in designing jobs.  Imagine a staff of people in "the zone."  A key ingredient is getting constant feedback.  This drove me nuts at SHOR, where everyone was too nervous about insider trading restrictions to report on progress vs. bonus-able goals.  (Hey, Mike Healy, can you imagine a member of the SF Giants not knowing the score until the game was over?) Container Store holds daily morning huddles in each store, and broadcasts updates during the day over headsets.

There were many other great points in our conversation.  Barbara is on a mission to continue to build new-style businesses by helping direct the energy of young entrepreneurs through her non-profit www.wildgift.org.  She also pointed me to www.consciouscapitalism.com, which was started by Whole Foods and The Container Store's co-founders to foster the principles of this fresh approach to business.  This conversation was another data point confirming that the art of business is making progress.  Thanks, Barbara!

I get lots of agreement and nods when I quote Drucker, “Culture eats strategy for breakfast.”  Culture is what every profiled CEO in the NYT’s “Corner Office” talks about.  Culture is what the Admiral I met on the USS Harry Truman waxed on about as the key to his success.  But often, people don’t know what it really means, or how to work on it, even though it is everywhere.

And I didn't either.  Jack Daly once challenged me, “Do you have a culture by default or a culture by design?”  “Um,” I thought, in 2003.

Culture is hard to work with because it is like water to fish.  “Artifacts” of culture can be found at office parties, in performance reviews, in the way meetings are run, in dress codes, in customer interactions, in software designs.  One investor I know claims he can read culture from the state of the office bathrooms. Of course, every one of these things is a topic to explore.  Arguably this is a topic for a book, not a blog.  But there is a way to “see” and therefore work with culture that cuts through the clutter:

CORE VALUES

A mission is a company’s definition of winning. Core Values are the answer to the question “how do we win?”  They broadly state what’s important to do, and the behaviors that define what’s uniquely important to do at one company vs. another.  You can map the most distinguishing features of life in a company to its values.    

So how do you work with culture? Come up with ways to invest in and amplify what you value.  It is not having lots of fun parties or unusual things to do at work.  That probably doesn’t hang together well, doesn’t scale, and may actually waste time.  If everyone believes that the values are the way to win, by definition they are worthwhile. M5’s Battle of the Bands events were awesome and legendary because they tapped into the energy of "learn" - one of our four core values. 

Another of M5’s values was “Be Honest.” We built technology, a highly transparent website showing the world our service foibles in real-time, to help us be honest with our customers and the market.  We rewarded someone with a trip to Space Camp in Alabama for telling a customer bad news.  We fired. Three $500 bottle of wine ordered at staff dinner wasn’t the problem, not "fessing up" after sobering up sent someone off the island.  We created stories about “Be honest,” and deepened it.  We designed our culture with intent.

One problem is that the stated core values aren’t always the real ones.  As with mission, you have to discover core values — if they are “aspirationial” posing as “core,” the leaders appear hypocritical, and the values can become irrelevant.  Pat Lencioni has a great riff on core vs. other types of values in,“The Advantage."  We shifted the words a few times as we tried to better describe our values, but the truth underneath didn’t move much.  Phillip Kim, a co-founder and always the skeptical engineer, had his own way of describing M5’s strengths, “Techies who do customer service well.” This was consistent and complementary to our other descriptions, so it helped. 

It is hard to “see” culture - it is the water you and your staff swim in.  But values are the lens that reveal what it is. Are the values truly core?  Authentic? Shared? Then, what decisions, processes, programs, activities and stories map to them?  We did a pretty good job at M5 building a culture by design.  But, we could have done a lot more.  Most companies don’t seem to make it a priority, certainly our competitors didn’t.  I want to bet even bigger on this next time.

Top VC Sequoia (investments include Zappos and Rackspace) have made culture a focus.  To close, here’s a great conversation with Alfred Lin and AirBnB founder about how core values are Air BnB’s rocket fuel:

In 2005, my wife Julie ranked thumb-chewing (and the resultant callouses) as my #1 most irritating behavior. Awesome.  I like nothing better than to knock tasks off a prioritized list,  but I did not know how to fix this sub-conscious self-cannibalization. Cayenne pepper spray, perhaps?  Later that year,  I randomly met Scott Weiner, PhD and hypnotist, at a networking event.  I took a shot. He was so confident. “No problem," he said. "2-3 sessions, $450 a pop and consider it done.”

It worked.  Completely.

Almost.  Seven years later after I decided to sell and then leave my company, I relapsed.  This summer I called Scott.  “A tune-up?” No problem.  One session.  Consider it done.

It worked again.

Scott and I have talked a little bit about his practice.  He juxtaposes hypnosis to meditation.  Some forms of meditation empty the mind.  Hypnosis, on the other hand, suggests specific instructions.  It is not far from “Inception.”  I’m not writing this blog to promote hypnosis.   I’ve had three friends try.  Two were satisfied, one wasn't.  I'm writing because I boil down hypnosis' near-magical effectiveness in to three worthwhile principles that I’ve since applied other places and you might try them too.

1. Relax. This is the very essence of a hypnotic trance.  People learn better when relaxed.  Scott would literally push me to be relaxed, more relaxed, deeper, more relaxed until I was in a trance.  This principal works in training and learning, generally.  I used to play music before meetings.  It works.  Yeah, that means you, now — breathe!
2. Positive beats negative.  Your brain responds to positive imagery more strongly.  If you repeat to yourself “quit smoking,” your brain hears, “smoking” and diffuses the “quit.” Focus on the positive, such as saying “without smoking I’ll be healthy, better-smelling, wealthier.”  I created images around looking more professional while concentrating, and having smooth thumbs.  I visualized the reward I promised myself for success. (My first iPod.).  There are a ton of parallels to other domains besides learning - like management, as outlined in the the business classic, “The One-Minute Manager.” It teaches a lesson about the power of catching someone doing something right.  Careful complements stick. For example, you give a dolphin a treat for going over the bar, then raise it until, eventually, the bar breaks the surface of the water and the dolphin catches air.
3. Ante Up. When I paid $450 and invested a few hours to stop the thumb chewing, I wanted it to work.  Skin-in-the-game has an impact.  WIBO found our free seminars had a much higher flake-out rate than the paid ones, and discontinued the free offer on those grounds alone.  At M5, our company learning programs were subsidized, not free, and people showed up.  It has been said, "That which is given for nothing has no value."
   

I am going to explore hypnosis to work on other behaviors that I know are tied to my sub-conscious, and we’ll see what happens.  Scott and I spoke about the limits and strengths of the practice, so maybe I’ll have more to report some day soon.  Overeating? (A specialty.) Sports performance? Scott has two colleagues who do hypnosis for golf full-time.  Walk around happier?  Well, it depends on exactly what you mean by “happiness …”

There’s no question that some of the great leaders I know have some practice for working at sub-conscious levels.  I’m told that Tony Robbins is a constant practitioner along with Mark Benioff.  I’m always curious to hear what possibly unconventional learning practices people have used.  But even without going into hypnosis as a regular practice these three ideas are universally powerful and easily applied.

Anyway, if we meet and I am clucking like a chicken, help yourself to the eggs.

“Human beings may be miserable specimens, in the main, but we can learn, and, through learning, become decent people.” 
― Orson Scott Card, Ender's Game

Josh Waitzkin commented that one of the most impactful features of the M5 Jiu-Jitsu program was that the CEO was wearing a white belt, symbolizing that I was learning with everyone else.  

My modeling of thirst for knowledge helped foster this value in the company.  And as I’ve often said, a staff of people who love learning is like a CEO’s wish for more wishes.  The tightest bottleneck for us was not capital, or market demand, or technical limitations - it was me, the team, and our own capacity to get stuff done.  So I’d better be working on that.  Besides, improving my own skills on company time was genuinely fun, a borderline guilty pleasure.  C’mon, the training montage is the best part of every action movie - epitomized by one of the best sci-fi books of all time, now a movie, Ender’s Game. (Get it, the game is the end?)

I thought I’d use four concrete skills as examples. Working on these paid big dividends for me.  This is not ...

 ... a comprehensive list. But these illustrate the point that most executives rely on the fact that they do this stuff already.  They don’t train to get more skilled at them. There is no coach.  There is little practice, only performances which are sometimes high-stakes.  Often there is little rigorous reflection or retroactive performance assessment  Some leaders repeat the same patterns in ruts for years.  Most harmful of all, they walk around with a black belt on that they haven’t earned, falsely thinking that this pose inspires confidence, when all it really does is shut down improvement.

1. Sales.  It is outrageous that this wasn’t even a course at Wharton.  There’s more myth and misinformation about this most crucial of all business skills then there was about sex pre Masters and Johnson (enjoying this Showtime show now).  When we started M5 sales was my responsibility, so I read a lot about it.  That’s about as useful as reading about ways to get in shape.  Eventually, I choose Sandler-style sales kung-fu, and hired a coach.  My small sales team and I then started to use the same language to evaluate each other.  We debriefed each other after calls, and for an hour together each week we role-played.  We took turns presenting training for each other.  Years later, without all that, I know I’ve gotten rusty, and I see myself pitching various ideas instead of reversing and asking questions.  While this became a strength for me, I know I could get better still.
   
   
2. Public Speaking.  I define this as talking to any group - a few people or more - not just the big venues. I remember after giving what I thought was a perfectly good presentation, my friend and colleague Cahal Grennan poked me in the chest and said, “If we’re going to be a big company, you’ve got to be way better at this.”  This is a great example of passive vs. active knowledge if there ever was one.  You might understand oratorical principles, and we've all probably read about them.  But try pausing for four seconds, live, like a world-class presenter does.  Try to speak in threes so even impromptu remarks sound polished.  Start to deploy time-worn rhetorical devices, start to learn to build to clap-traps, start to be a modulate your tone!  I’ve hired a couple great coaches along the way, and included my team.  Expensive, but worth it.  Cahal started a toastmasters chapter in the office, which was really popular.  I learned to love this sport.  It was great to be able to pull my colleagues in for a real critique before a presentation and vice versa.  Now my favorite question after a good presentation is, “Who’s your coach?”  Many really good speakers have an answer.  Everyone wants to present like Jobs - well, guess what, he worked each keynote for days before making it look easy and he hired pros to help.
   
   
3. Negotiation.  In contrast to sales, this one has made its way into most MBA curriculums, and is consistently top-rated by students.  Thanks to Roger Fisher (Getting to Yes), the dogma has shifted from haggling to joint problem-solving.  Few skills that have a more direct impact on value creation. Imagine if you and your team could negotiate just 3% more effectively.  We ran the MBA curriculum at M5 and even had a professor teach it.  Approaches like “widening the pie” became standard for us.   I found that reading through a book on negotiation when I faced a big one and doing a little prep and planning was invaluable.  When it came time for my biggest negotiation, I hired one of Roger Fischer’s proteges as our banker.  Great on-the-job training if there ever was, and it showed just how much better one could get at this.  What do you value more in your banker: connections, analytical prowess, or negotiations mastery?
   
   
4. Teamwork.  Most people don’t know how to begin improving this quintessential leadership skill.  You can’t see what you are doing well or not, you just feel if it is kind of working well or that something’s wrong.  Even if you’ve read a few Pat Lencioni books and have some theory about it, you probably still forget most of it while going through the day.  How do you make it muscle memory?  OK, you can head to a ropes course.  But the absolute best training we ever had was Pluralistic Networks, “Working Effectively in Small Teams.”  Four months long and enough to rewire a neural pathways and bad habits.  The course is centered on immersive experiences in the World of Warcraft game, where you can observe your team patterns from a new angle.  So fun!  We got teased, but also got the last laugh! 
   

Which skills are you working on?  Are you open to getting the maximum help you can by walking around in the posture of a beginner?  Do you have a coach? Do you practice with live ammo or in a safe space before the performance?  I can list a hundred others skills to practice from reading a balance sheet to telling if someone is lying.  I'm always curious to hear about great experiences and great teachers.  Let me know what you've got!

"If you don't know where you're going, it doesn't matter which way you go."
- Cheshire Cat, Alice in Wonderland
 
"Those people that find higher purpose to business than earning money are the ones making all the damn money." - Greg Glassman, Founder and CEO of CrossFit

I used to ask new hires if their prior company had a mission.  They almost all said yes.  When I asked, "Was it relevant in day-to-day life at the company?"  They would say no.  It was usually on a poster somewhere and too long, not memorable. Research backs the widespread lack of relevant, authentic company missions.  For example, a quantitative study by Christopher Bart points out, “The overall conclusion is that, in any sample of mission statements, the vast majority are not worth the paper they are written on and should not be taken with any degree of seriousness.”  

Mission statements were not part of MBA dogma when I was an student in the 90s.  Instead, Wharton taught about the overarching purpose of creating shareholder value.  We debated the perils of straying from the primacy of wealth-creation.  I was left wondering why the legendary Dilbert Mission Statement Generator (sadly no longer online) didn’t just repeatedly spit out the one-size-fits-all mission, “Make Money.” 

However, I've found purpose to be one of my absolute favorites in the leadership toolkit. Used wisely, it creates shareholder value and provides some benefit to society. 

You might think of mission as the ball.  Share price or market share or another more traditional method of 

Purpose is emotional and emotion is powerful.  People make decisions to work with you or for you based on emotion, and justify the decisions with spreadsheets afterwards.  Numbers like share price or market share are much less inspiring on a day to day basis. 

This is not my idea.  As a new CEO looking for answers, I was practically bullied into thinking this way by legions of business gurus, like Jim Collins, Verne Harnish, Pat Lencioni, Jack Daly, all of whom practically shout this from podiums.  It seemed like every speaker at a learning event for entrepreneurs talked about mission.

So why don’t more leaders harness the power of purpose?  It is hard to do.  An anthem for me, "Passive understanding is easy, active practice, not so much."

When I met Simon Sinek (before his TED talk and book, "Start with Why"), we decided to work together because he was excited by our opportunity to build a leader in a big, vulnerable industry.  Simon’s process was instructive.  It is difficult to create a purpose or impose one on an existing organization. You have to discover it.  Simon took hours of biographical information from founders and other key leaders.  He pointed us towards the commonalities, and helped us find words.  Like Michelangelo s sculptures, the statue was always there, you just need to chop off some extra marble to set it free.

This very process is at the heart of why working with purpose is so hard.  It has to authentically permeate all your stakeholders to matter.  Here are some of the challenges I found:

• Investors - None of my VC's talked about mission. When we became public as part of ShoreTel, the Board and investors seemed even less interested.  Leaders need a lot of confidence to stay on mission in the face of constant investor pressures.  I remind everyone that mission can help create value.
  
• Leadership -  It starts with the CEO and founders, but as the company grows, "Mommy and Daddy" have to believe the same thing.  Luckily in our case, my co-founders were on the same page.  As Phil Kim said (in his characteristic cut-the-crap way), we were “techies who do customer service well.”  As we scaled, I failed many times to hire leaders that truly put the mission front and center.  Egos and silos increasingly eroded our unified mission.  It's a mistake I hope never to make again.

• Measurement -  It is difficult to work with what you can’t see.  That is why my CFO was likely to side with investors in the “who cares” camp.  Because our mission was around customers experience, we used Net Promoter Scores (NPS) scores to measure how we did against mission, and that worked well for us.  Unless you can make it tangible, some people won't get on board, so you need to figure out how to measure against the mission.

• Hypocrisy -  Mission is powerful, but it is a weapon that cuts both ways.  If you aren’t authentic (imagine a CEO trying to lead a customer experience mission who rarely talks to customers ... ), you will get eaten alive by staff, and the market.  If you are going to lead a mission, you need to go big or go home.  This means talking about it all the time.  Engineers are a particularly tough crowd for this soft stuff, and true-believer engineers are the most dangerous.  They killed and ate several of my hires.

In “The Advantage” Lencioni’s categories five types of mission:

• Wealth Creation - maybe the purest, Berkshire Hathaway
• Industry  - Harley Davidson evangelizing motorcycling 
• Community - Go Brooklyn!
• Employees - Zappos was first and foremost about culture
• Greater Cause  - Southwest democratizing air travel
• Customer

M5’s was about the customer and it met the test of being inspiring. (As an aside, I’m hopeful that ShoreTel’s new CEO, Don Joos, a champion of the customer experience, will tap into this mission and authentically and bravely double-down on its continuation.)

I love mission-driven companies.  They are a minority, but growing as leaders figure out how to do this well.   Some missions are big. Google is famously still on its 100-year mission to organize the world's information. Some missions are small.  Sarah Endline’s Sweetriot is a nice example.  Some missions are personal.  Bre Pettis' revolutionary 3D printing company, MakerBot, is anchored in his personal mission of enabling creative people. I'm thinking Bre is strong enough to keep this story going even after his recent sale to Stratasys, but we'll see.

True alignment around a clear, worthwhile purpose is one of the ingredients I’ll cook with in my next venture. I'm resolved to work harder to ensure mission-alignment as we add investors and leaders.  It is much easier to do as a start-up, but if the fundamental purpose is there, and it is close to my heart, maybe I can work with an existing organization. Mission is an ingredient that can help make a delicious company.

(I just found another CEO who wrote pretty much the same blog. There are many out there!  Check out David Hieatt. And here's a link to a piece about a company that's only organizational principle is mission, more or less.)

Yesterday I heard that the head of product I hired didn't last the year.  Product innovation was one of the hardest things for me to scale.  One of the purposes of this blog is to clarify my mistakes so I can avoid them next time, so I thought I'd tackle this topic. Besides, I just read Eric Ries' "The Lean Startup," which also reminded me of how hard this is, and suggested an answer.

To continue the setup, I met an old friend who just closed his startup.  They spent one year, solved many technical hurdles building a cool app, but never got any real market traction.  The entrepreneur's decision pleased his VC, as most companies linger for much longer. The developers who built intensely all year, pleased not so much.

• Model.  Your first job as an entrepreneur is to build a business model, not a business.  Most people spend way to much on prototypes or technical solutions before validating that they can affordably attract customers.  
• Minimum Viable Product.  The mission is to get to the model as cheaply and quickly as possible. So get over your perfectionism and ship a "minimally viable product." Then, learn. This approach is fueling a new wave of very scrappy startups.   We blew this at M5/SHOR and often took ... years (ahem, cough, cough) to ship stuff.  We packed new apps and features with requirements, many related to integrating to other department functions like billing, or around scale & reliability, and then never launched.  The Zappos guys had told my team first-hand about how their first orders were fulfilled by running to Nordstrom's!  We didn't get it.
• "Get out of the building." Meaning go see customers and listen, listen, listen. Toby Hecht used to talk about designing offers to take into account all the background and historical conversations that are going on in a customer's head, workplace, and culture.  You need to ask deep, penetrating questions and don't shy away from "what price would you pay?"  And listen, listen, listen.  Our attempts to automate this with portals like ideas.salesforce.com never flew - you've got to do this yourself.
• Metrics.  Focus on a few key metrics that matter.  Ries recounts the Facebook legend: it took less than a month for 3/4 of Harvard students to adopt Facebook, and more than half of the users came back every single day.  Most of our product discussions were not even data-driven.  Avoid "vanity metrics."
• Validated Learning.  Protect the time to iterate until you see real evidence.  I remember ShoreTel's product organization going out and talking to customers and coming back with a few quotes about how people liked one idea or another - which was viewed as enough evidence to invest millions.  Ooof. We almost never budgeted for second versions of stuff, we were all shagged out by the time we shipped anything. Structural pressures - deadlines, market launches, screaming customers, bosses, Boards, and especially my own promises make this very difficult to do.  I feel like every time someone suggested that we needed more data it was easily squashed as an anti-entrepreneurial and bureaucratic request.

For me, it all boils down to STFU and listen.  Value learning and reward mistakes.  Remove institutional pressures that work against you.   

I can't be all negative.  M5 did this well in a few areas in particular:

• Positioning. Our biggest insights in developing our phone system came when we remembered that no one wants a phone system.  Our customers didn't really even want phones, or phone calls.  They want sales, and happy customers.  Or more time out of the office.  How could M5/ShoreTel take care of these needs?  That thinking helped us create unique positioning against these real customer problems, and begin to tailor our product for them.  When I was trying to figure out what a Chief Strategy Officer did, Angela Tucci, who held that job for Symantec,  said that her entire role turned on the question, "What problems will we solve for customers?"  I wrote another blog about this, Holes and Drills.
  
• Sales. Most Salespeople think they are paid to talk about their products.  Good ones have lots of knowledge to share. So they do.  STFU! We spent AGES trying to train ourselves to listen to prospects more.  Questions are so much more powerful than slides.  I recommend Sandler as one of many approaches to training this.  By the way, the same thing often happens when a talented guitar or keyboard player rarely jams -- less is so much more! STFU and groove!
• Software Development.  Embarrassingly late in my tenure we adopted agile development, which embodies much of what Ries is talking about.  Constant short sprints, constant feedback.  I highly recommend Agile Product Management with Scrum, a book that unlocked agile for our management team. It describes the difference between a classic product manager and an agile product owner.  It is specific and actionable.  It clearly explains all the basics of agile.  When our team read this, it catalyzed our transformation.  We went all the way on a multi-year journey, with the help of Brent Hurley of www.girasolutions.com, who I highly recommend too.

But STFU is hard.  Ries' book is the classic offer of Passive information - you will nod in agreement with most of it, then not do it.   I was making some calls to find good candidates for the new Brooklyn EO chapter this week and I caught myself spewing.  STFU! Listen! I know that the prospects won't remember what I said, and I missed many chances to really dig to see if they were a good fit.  And we had a long way to go with Agile --  It was hard to interrupt working developers and make them to listen to input from users.  Larry Babbio, who built Verizon Wireless and spent a year on M5's Board, told me the only way he ever got this to work well was to physically sit developers next to their business clients so they had to listen to them all day long.  As I said in the opening, I never found a product leader who could really make this happen.  But I know the next one will!   I've recently had lots of opportunities to practice this approach in conversations with entrepreneurs about their businesses, and I plan to work to get better at it.

To sum up, I'm connecting the #1 sales mistake with the #1 product development mistake with the mistake I saw two entrepreneurs make and the one Eric Ries wrote a book about.  Boiled down: STFU and listen harder. And with that, I shall take my own advice, and

"In 1900, 3% of Americans practiced professions that were cognitively demanding. Today ... 35%." - James Flynn, Ted Talk

I like TED talks for the same reason I like business books.  Inhaling someone's passion and life's work is inspiring, and gets my ideas flowing.  TED talks work well while on a machine at the gym.

This talk gives is a brief history of our cognitive development.  The type of work that the (almost) majority of humans are working on all day has shifted radically in this century.  So the most fundamental ways we think have changed as well.  The opportunity to design new tools and arrangements to meet this challenge is staggering.  We're a completely different animals than we were three generations ago, and it is very disorienting.  Opportunity!