Fonality blogs

There is no such thing as good hiring, only good firing

chris — Sat, 11 Apr 2009 02:42:09 +0000

I realize that the title of this article:

Contradicts a legacy of hiring books with titles such as Hiring the Best and Stop Hiring Failures. Amazon has 17 pages of such while Barnes & Noble clocks in with 224 titles.
Potentially puts a gaggle of managerial consultants straight out of work.
Makes me look like the grim reaper of CEOs.

...but bear with. What I am about to say has been learned, on the job, in a 15 year career of hiring...and firing...the better part of 1,000 people. Ugh, that made me feel old.

What I have learned is, despite all the cute tricks of the interviewing process (which I will blog about later and which only slightly improve your odds) your chances of hiring a great employee in a couple of interviews are about the same as your chances of getting a great spouse from a couple of dates. In other words, unless you're into the dowry thing, forget about it. Now, I realize that larger companies have longer interview cycles and a host of vetting mechanisms to winnow wheat from chaff. But in startups, where you hire fast and loose, you just can't get good results enough of the time.

Yes, long ago I accepted that hiring a new employee possessed a high variable of risk. I've had interview bombs turn out to be rock-stars, and interview stars never show up mentally for work.. My years of experience have taught me, as it relates to the hiring process, that you can’t presuppose anything. First judgments can be way off, and, while you shouldn't hire the guy that walks in one hour late, and didn’t notice a Cheerio stuck on his lip, anything else is fair game. It takes time to glean an employee's pithy attributes: work ethic, intelligence, attention to detail, enthusiasm, even personal hygiene. And lord do I have some stories on the hygiene front.

Thus, what I have come to is that the hiring process is not nearly as important as the firing process. By this I mean: your skill as a manager is not based on your ability to get good people into your group, but on getting bad people out. The sooner you cull weaker players, the sooner you can replace them with stronger players (for relatively the same salary) and improve the human composite of your firm.

Seems obvious, don't it?

Boy oh boy, it ain't. Managers just *hate* to fire people. They will endure a bad employee for months, even years, to avoid the pain of firing them and the headache of re-hiring the position. It amazes me to watch the capacity of the human spirit for suffering the lack of spirit in the ones that work for them.

Why managers hang on to sub-par players:

They would rather have bad than none.
Any intelligent boss will always let you replace bad with good.
You have never fired and are scared of the process.
Yeah, it sucks. But, get over it.
They are too nice.
Consider a career change. This is business.
They have an overdeveloped belief in the value of institutional knowledge.
Nature not nurture people! The very definition of an "A" player is someone who comes up to speed quickly. In fact, if you are too scared of losing institutional knowledge that might be a clue that you don't know what your people do and therefore are not that useful yourself.
They aren't good enough to know who on their team is bad.
Fire them.
Stockholm syndrome.
Break free. You can do it!
Firing people ruins the culture.
No, firing bad people improves the culture because it sets standards, and proves consequences.
One bad apple does ruin the bunch.

What managers don't realize about the firing process:

That employee was probably unhappy anyway.
Most fired employees are actually miserable and trundling along just waiting for that push.
A-players make you look better.
And, they allow you to take a worry free vacation.
Your team thinks you suck if you don't have the chutzpah to fire.
You are not the only one that knows they suck. Earn their respect by making the tough call.
You are hurting your own career by not becoming an effective firing manager
This is a lose/lose for you:
Best case: your boss doesn't notice the weak link, but does notice that your overall team isn't very effective. Worst case: they notice that you don't have the nerve to make the call and skip you at promotion time.

I leave you with this thought: in 15 years of firing, while I have *long* pre-labored over the pain of having to fire, I have *never not even once* come to work the day after a firing and regretted it. 99% of the time my feeling is: what the frick too me so long.

So, what's taking you so long?

A.I.Gee Whiz!

chris — Thu, 26 Mar 2009 04:57:34 +0000

Things really suck out here. Them on Wall Street suckered us good. We on main street let ourselves be suckered. And, now our hard-earned tax dollars have to pay for the privilege of being sucker punched. Yah, it sucks.

But, I really think the populous is getting a bit too nutty. This latest AIG witch hunt is just nonsense. And, if people would stop waving the smoldering torch in each other's eyes for a moment, the rest of the lynch mob might be able to realize that what they are doing is counter-productive.

Let's do a quick analysis of our go to market plan:

We, the taxpayer, loaned AIG $170B. Like it or not, that's what we did.
You and I now own 80% of AIG. We are the new majority shareholders. Woohoo!
Now, we (as taxpayers) have begun a witchunt against our (as AIG owners) executives in effort to reclaim $168M of the $170B loaned. FYI, this is 1/10th of 1%! So, for every $100 loaned, we are trying to recoup less than 1 dime!
As part of our hunt, the "we" (as taxpayers) are trying to get the "we" (as AIG owners) to break our pre-existing employment contracts with our executives. This is illegal and creates a liability for us. Oh, we are also scaring the devil out of our remaining execs and putting the other...oh...$169.832B of our investment at risk.
Now, our duly elected politicians are using the taxcode to punish these execs -- besides being arguably unconstitutional, this puts all of our (as taxpayers now) liberties at risk. Oh, some politicians are even calling for them to kill themselves!

OK, now put down your war drum for just a second longer and let me elaborate. First off, yes, I know that 52% of AIG execs aren't even there anymore. And, I further realize that any remaining ones (that were in any way associated with the credit default mess) do *not* deserve a dime. But, damnit, a contract is a contract. If you sign a contract with me that says that you will pay me $100 for every $5 of yours that I lose. Then, doggone it, when I roll up a big wad of $50 and smoke it with my feet on your desk while looking you dead in the eye, I expect my $1,000 bonus.

Ask me if I think we should have bailed out AIG? Hell no. As I already wrote, I am pissed that big companies can't fail, but little honorable companies can.

Ask me if I am pro Wall Street? Far from it. I believe in making money by making stuff, not by trading bits of electronic data. Plus, the lack of oversight has always terrified me.

But, I do believe that as a society, we should honor our contracts. Without rule of law, we have anarchy. By making law on the fly, we trend toward totalitarianism.

I say, let's stop the cries for the public stockade for these execs. We already bought them a shovel. Let them dig their way out of their mess with it. That seems a far better endgame than us using that shovel to dig them a row of shallow graves.

Kisses,

Chris Lyman
Fonality CEO & Janitor
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P.S. For those of you that got this far without breaking out the anthrax, you may find this letter today from an AIG exec in the New York Times interesting.

Giving it back

chris — Wed, 25 Feb 2009 00:49:45 +0000

(For most of my readers who come here for general business topics, skip this blog. For the few that come here for Open Source or telephony information, you may find this open letter (verbatim below) I wrote to my employees last week interesting)

Yesterday, as I was making my way to the microwave, Nathan, in our bad ass support group, stopped me and asked me "why Fonality does not give back to the Asterisk community?"

This is old-school FUD created by Digium and its employees (and propagated to the media), but I was surprised to hear it coming from our own. "Give back to the community" always makes me chuckle at the power of propaganda.

Thus, I thought should quickly explain Fonality's stance on Open Source and Asterisk, since some of you are new. You are welcome to share what I write with anyone including our customers, our competitors, and the media. There is nothing secretive about our position now, in the past, nor hopefully in the future. In fact, I am proud of our position on this subject.

SHORT ANSWER

Digium forces any contributor to Asterisk to sign their commercial license, which gives them the perpetual right to sell your contribution back, in commercial binary form to anybody. This is not in the spirit of Open Source, so we won't sign. Thus, our changes do not get included in Asterisk. Many other contributors balk at this license which is why Asterisk has so many forks and offshoots (such as trixbox CE)
Every fonality customer gets full access to our Asterisk enhancements. We either put them in /usr/src directory (PBXtra) or available at: http://yum.trixbox.com/centos/4/fonality/SRPMS/ (trixbox Pro). We have always done this and will continue to.
We continue to maintain a fully free and 100% Open project in trixbox CE, which we give to the community under a 100% GPL. No commercial license funny games with trixbox CE.

LONGER ANSWER

As we all know, Digium is the original author of Asterisk. They also maintain the official source code tree, effectively acting as sole authority over *what* goes into the next version of Asterisk and *what does not*. Fonality and the general trixbox or Asterisk communities have no say in this matter.

This is not unusual. There are a number of OS projects that have a commercial company acting as the sluicegate for community contributions. But, here is where Digium gets sneaky. Before accepting any enhancement code from the community, they require said contributor to sign what they call a "Submission Agreement". This submission, while seemingly benign, is actually a wolf in sheep's clothing.

Among the most troublesome passages in this Agreement are this:

“You hereby grant Digium a perpetual, worldwide, royalty-free, irrevocable, non-exclusive, and transferable license to use, reproduce, prepare derivative works of, publicly display, publicly perform, distribute the Submissions, and to sublicense such rights to others.”

...and then this, which compounds the problem:

“The rights granted may be exercised in any form or format, and Digium may distribute and sublicense to others on any licensing terms, including without limitation: ...(b) binary, proprietary, or commercial licenses.”

(you can find the entire Submission Agreement here: http://bugs.digium.com/view_license_agreement.php)

To paraphrase, what this Submission Agreement states is: In order to have your enhancements accepted into Asterisk, you have to first agree to give Digium the right to perpetually sell your enhancements to any other company under a commercial, binary, or proprietary license.

So, what does that mean? This effectively means that Digium can sell your enhancements to another commercial company under a non-GPL license and that company is not bound to give enhancements back to you or the community. This means you do the work and they profit from it

Does that sound Open Source to you? I didn't think so.

So, I will *not* allow Fonality to sign this masqueraded commercial license. Instead, when we do improve Asterisk, we choose to give it back to the community *but* not Digium. This means that our code can be used by anyone, but can never be built into a commercial license and sold. PBXtra customers can find our source code in /usr/src and trixbox Pro customers (where we don't have enough room) are provided this link in their welcome email: http://yum.trixbox.com/centos/4/fonality/SRPMS/

On top of all of this, we maintain the trixbox CE project. This project is 100% GPL and therefore 100% Open Source. Contrast that to Digium, who maintains Asterisk under a dual-license (one GPL and one 100% commercial), you will see that Fonality's treatment of Asterisk is more in the spirit of true open source than even Digium! lol!

But, Chris, Digium wrote all of Asterisk and Fonality has benefited from it, so shouldn't we give back?
Digium did not write Asterisk for the betterment of mankind. They wrote it to fund their own for-profit hardware business. The more people that use Asterisk the more hardware they sell. Asterisk was, quite simply, a means-to-an-end for them. Digium is funded by Matrix Partners and Matrix is not there for altruistic purposes.

To summate, I don't get religious about this stuff. Open Source is a mechanism to provide standards-based software at a lower cost. It is not a holy war and there are very few prophets on the battlefield. Most of the really successful Open Source companies that you know and love (Apache being an exception) have a for-profit business behind them and a board room full of venture capitalists behind them demanding an ROI. Digium is no exception and neither is Fonality. The only difference is we sell software out of the front of the truck and they do it out of the back while pretending that companies like Fonality have done something wrong.

Which type of company would you rather work at?

Budgeting is BS

chris — Sat, 10 Jan 2009 00:26:45 +0000

It's that time of the year again - budgeting. <apply thumb to windpipe of nearest exec and make them commit to ridic numbers>

*groan* *whimper* *gag*

Budgeting in a venture-backed company is a little different than an owner-funded one. In an owner-funded company, you make some expenditure decisions based on two things: areas of the business that need investment (scale, R&D, etc.) and sales/marketing risk-expenditures in areas you think have growth potential. It's a pretty simple process. No BS. And these are generally "game day" decisions; you don't spend a lot of time looking 2, 4 or 8 quarters out. Not with payroll to make this week.

But in a venture backed company it's totally different. Most of your budgeting is based on massive growth predictions. Your investors expect you to deliver outsized performance to deliver outsized returns to their investors. And, of course, most VCs invest in disruptive companies with the potential to do just that.

So at budget time, you have to commit to these numbers with an air of confidence even though you have no idea if or how you're going to get there. And, of course, you have to build a very formal budget based on those ASSumptions. It all looks very neat on paper -- a big bottom's up model fed by appropriate input drivers and reasonable cost modeling, built up and then back down to each department.

Only its all BS.

Why exactly is it bovine excrement? Well, for starters, there is no way anybody knows if they are really going to grow annually by 25%, 50%, much less 200% in a year. Sure, one can predict modest growth with modest accuracy. But, reliably predicting venture-desired astronomogrowth requires a heady mix of hyperbole, cognitive dissonance, and a pressure-based stool sample. Goes great on a bed of basmati with a Santa Barbara red, btw.

That's all the "how big we will grow to part". But this takes for granted the "how the hell we are going to do it" part. Its true that, for a short time and for a select, fortunate group of companies, they can J-curve a single product in a single market (Google is still doing this, $10b later...), but most companies and markets are more complicated than that. And then you know, those pesky competitors keep "helping" you throw last year's plan into the compost heap. So the reality is usually way more complicated than the plan.

Let's cut to the chase -- nobody knows how they are going to pull off such huge growth in a single year. Sure, you know you are going to launch some new products, and of course you can wrap those in some expectations. And, yes, you understand that you are going to re-invest in other areas of the business, and, well, of course you can make some geustimates about what that might yield. But, the problem lies in the accuracy. See, once you keep stacking all of these "ifs" on top of each other, each replete with their own armada of assumptions, you end up with what I call the "stackable ifs" problem. Translation: you have no forking clue.

Add to that today's real-time business cycle and wildly compressed development times and you can really be in the world of make believe. Its not divulging too much to tell you that, in each of the past three years, our biggest growth drivers weren't even on the roadmap at budgeting time. Combine that with that fact that Fonality's worst annual growth year in its five year history has been 45% and you can see that huge growth and the accompanying budgetary predictions of such are rarely lifting hem in the same pew.

But that doesn't stop the ball from rolling. And, lord, the time all of this takes. Meeting after meeting wading through numbers and predictions and side conversations and re-meetings and on and on and on. It all feels very real but peeeeeple come on, its really all very very grey. And, this precipitously dive-bombing economy doesn't help. Heck if Intel can't predict their revenue how the heck can I predict ours?

Now, before you think I've gone rogue, I'll have you know: I *have* been being a very good boy and I *am* having all my perfunctory BS budgeting meetings. And, yes, I have been stroking my proverbial beard and sorting through the stackable ifs. And, the more I do it, the less confident I am in the *how* part.

However, through the exercise, I have stumbled across a number of really interesting things that DO benefit my business. I have been forced to deep dive on issues like close rate, competitive analysis, internal sales automation and lead sourcing -- all of these areas have been illuminated during these extensive personal caudal appendage perusals.

Then it struck me - maybe THAT is the point! Maybe this is not so much about actually predicting the future. This is an exercise of the present. One cannot elegantly step into the future unless their back foot rests on a solid present. This digging certainly has gotten me thinking about ways to do some things better in the here and now.

Whelp, I better get back to it. I have to present this BS, err budget, to my board tomorrow. I sure hope they don't know how to use the Google or they may stumble on this blog and my expense line may, err, suddenly be reduced by a notably babbling head count. o.O

Let it Burn

chris — Wed, 01 Oct 2008 17:07:16 +0000

I say let it burn, people. While at first glance this may sound like the cavalier ramblings of a free market zealot. Actually, it's not.

Instead, I think there is a sickness in America and this mess from Wall Street to Main Street (I am so tired of that term) is just an indicator of how ill we, as a nation, truly are.

Folks, we are a debtor society. We exist in indentured servitude. We are serfs to our credit. We serve Lord Bank and Queen APR and we use our credit card to buy stock hoping to pay off our credit card.

IT IS MADNESS. And, it has gone on for far too long.

I recently found out that my mother, my incredibly smart, well read, world-traveled, pragmatic mother, lives with $30,000 credit card debt. Ug. She just corrected me on the phone. It’s up to $50K now.

"Why?????" I asked with astonishment (I have never had a dollar of credit card debt in my life, even when sleeping on a floor because I couldn’t afford a mattress 10 years ago).

"Because I don't feel like living poor."

Everybody in this country lives beyond their means. They drive a Mercedes when they should drive a Honda. They live in a million dollar home when they should live in a $250K one. They shop when they should save. We are all out of our minds. The New York Times reported in 2005 that 20% of all Americans have a net worth of zero or less. This means they don't have a positive $1 to their name.

Living with no money is fine. It could actually induce happiness if you were free to roam the world with a knapsack, a head full of windy hair, and a tune that needs a’whistlin. But, living without $1 when you work your ass off every day…is…tragic.

And, our system supports this tragedy: some credit card companies may actually penalize you for paying OFF your credit cards. From Yahoo answers: "GE Rewards MasterCard holders who pay off their entire balance in a timely manner are actually penalized $25 per year." Heck, I abstained from getting a credit card during my stint in college and my credit suffered for years because of it!

Now, I realize that this current Wall Street mess may seem to be more home debt than consumer debt. But, it’s all the same problem. And, it is time we stopped pointing fingers. This is isn’t the politican’s fault. This isn’t the bank’s fault. This is OUR FAULT. We are the idiots that live beyond our means. We are the people that confuse happiness with possession. We are the people that think a mountain of debt is something we are supposed to live with.

Everybody is claiming that this is going to be the worst economic period since the great depression. Yah, it probably will be. But the problem is much simpler than we all think: Americans now spend more money each year than they earn, by a full 1%. This has only happened four times in our nation's history. 1932 and 1933 during the Great Depression, when we had unemployment rates of 25%. And, yep, you guessed it: 2005 and 2006 (probably 2007, but I haven't found the study).

So, folks, it's not *just* about this housing crisis, or about the lending institutions, or the naughty politicians, or the faux populism of overpaid CEOs. This problem is about you, yes, overleveraged you. What were you thinking? Didn't you know this charade had to end? Everyone keeps saying this all about "confidence". Yah, it is. As long as you have confidence in negative math, maybe nobody will notice we are all broke, and broken.

So, I say, let the bitch burn. It's a colossal credit correction and we have been due it for a long time. No other country in the world lives with the staggering amount of consumer debt that this nation does. And, eventually it all has to come crashing down.

Who am I kidding, though? They won’t just let it burn. Those panicked lemmings on the Hill (the same geniuses that invaded another country because of some photos of a grain factory) are *surely* going to come up with *some* type of bail-out bill. So, instead of railing against the concept, let's spend that energy crafting a more effective bail-out proposal.

It seems to me that the bail-out is happening on the wrong end. Why are we providing liquidity to the banks -- the holders of these toxic loans -- when the problem stems from the unstable loans themselves? It seems to me that if we helped more people pay off their loans, then the loans wouldn't be poisonous, and the banks would have capital to continue operations. Fix the root and the leaves grow green.

But, I dunno how to really “fix” this, and I don’t think it can really be “fixed”. Nor, do I mean to take this lightly when I say “let it burn”. I get it. I get that this is gonna be a hard row to hoe, people. But at least, while hoeing, we will finally know the reality of what real dirt feels like in our hands again -- instead of this crazy glass floor we have been tap-dancing on for decades.

America vs. Small Business (1-0)

chris — Sun, 21 Sep 2008 00:45:48 +0000

OK, this is a bit off my usual business bent, but I am, well, bent. What’s got me all bendy? It stems from the fact that I now live in a country with socialized insurance. Heck, I can't even get socialized medicine for my workforce, lol.

Actually, it’s not the insurance bail-out in particular I care about. It’s *all* of these damn bail-outs. I know, I know… many of you had AIG insurance so you avoided [insert personal crisis].

I know, I know…if we didn’t bail out the airlines after 9/11 [insert portend of doom and gloom].

I know, I know… if we didn't bail these behemoths out, our economy would have [picture of Chinese army pouring down Main Street, USA].

I get it, people.

I get that these bail-outs are great short term fixes to prevent nasty slumps on the “Street” and to protect our “Nation’s Interest”. (BTW, is there a secret room somewhere where a council of wizened druids decide exactly what our nation finds “interesting?”)

So, yah, something about all of this has been bugging me for a few days and, finally, while at lunch with some of my beloved engineers the other day; I was able to put my finger on it. The convo went something like this:

Chris to engineer: “So, what do you think of the bail-outs this week?”

Engineer: “I dunno, when can we get bailed out?”

Me: “When we get to $10B in sales.”

Then it struck me. These bail-outs are so ANTI-innovation and so pro-corporatism. Anyone will tell you that the strength of the American economy was founded on the innovation, guts, and entrepreneurialism of the small business owner. Look at Microsoft and Google - they were both small businesses not too long ago. But, by bailing out these big guys it provides a strong incentive for them to take stupid risks and have the government carry the note on the downside. If your smaller, more nimble, more innovative companies (that’s you, Dear Reader) can’t take those same risks, then well, tough noogies. Score a competitive advantage for the big boys — upside with no downside. Whoopee!

I realize that not every huge company gets bailed out. Lehman Brothers, for instance, has gone the way of the dodo bird. The truth is: you have to be both huge *and* considered of strategic import (infrastructure/economy/etc). But the innovation-stifling point holds:

You can bet they would bail out AT&T and not Vonage. Vonage is the innovator here.

They did bail out the airlines after 9/11. But, my buddy’s small airline went bankrupt recently. He was an innovator, with a great concept of affordable business-class non-stops from NYC to London. *poof* gone.

Isn’t innovation the pith of American DNA and shouldn’t our government stimulate and not squelch it?

What exactly *does* it say to our supposedly beloved SMB (small and medium sized business) when our government bails out only the humongous companies? It doesn’t say anything. Instead it gives them the finger. Well, three fingers:

It provides a safety net for just the big boys. As stated earlier, this allows them to take greater risks because daddy will be there to bail them out.
It rewards bad behavior by removing the consequences for poor planning. This will always create broken systems.
It makes small business tax payer dollars cover their bigger competitors while they get no same coverage on their own business. Huh?

As an advocate of small business innovation, it just stinks. So, I ask the small business owner, besides SBA loans and the like, what other things could our gov’t due to bail you out and level this tilting playing field?

Leadership is never given, it's taken.

chris — Tue, 24 Jun 2008 21:06:26 +0000

Hey, Freud, roll over dude. Help me understand this one: How is it that people can sit at work all day and allow their conscious selves to have a robust internal dialogue about how many great ideas they have to improve the business they are employed at, while their unconscious selves leave them entirely powerless to speak up? How is it that instead of speaking up, they somehow justify their silence as a requisite of station and then go home that night, snuggle into their couch, fist remote into hand, and blast entertainment into both oracular sockets until the workday is long forgotten? Freud? Hello? Mother?

People can just be so weird at work. I find this dichotomy all the time after some work crisis – usually a customer getting screwed over by ineffective or missing process. During my forensic examination, I end up querying all involved employees about their role in the disaster. After narrowing it down to a single employee who made a crucial decision to *not* speak up, I almost always hear one of the same four lines after questioning them:

“That’s always been the rule, since before I got here.”
“That came from my boss. I don’t agree with it, but I don’t make the rules.”
“I brought that up to my manager, but they didn’t listen.”
…or…my absolute favorite: “I always knew that was wrong, but what can I do?”

For some reason, people assume that leadership is *given* in business. The typical mindset is:

“If only I were given the right to lead, then this place would run so much better.”

But, of course, since they *have not* been hand-delivered this right on a silver platter they feel that they are powerless to truly affect change in their workplace. Hence, they just keep their mouth shut and let all the idiot managers around them fuck the place up.

Huh?

What makes you think leadership is given to anyone? Did it ever occur to you that the people “leading” earned it as a result of NOT sitting on their hands and NOT letting everyone else hurtle the Titanic toward that particularly ominous looking shard of ice?

Let me ask you a question, Mr. Employee-who-is-so-ready-to-kick-ass, if only UPS would drop off a box of “ass-kicking-certification plaques” at your doorstep and say: “Look what brown just did for you today”…was leadership GIVEN to you in your personal life? Did you go to high school and get to sit in the leadership desk? When you hung out after school were your friends like: “Hey, what should we do today? Let’s ask Jim, he is our natural born leader.” Or, when you go to the bar, does the whole place mill around sheepishly slurping their vodka cranberries waiting for you to stand up and tell a joke that rocked the house?

Hell no. In personal life, the leaders are the ones that TAKE it. They are the ones that have the charisma and the chutzpah to make a joke – or to make a decision about WHAT BAR to go to, or rise to the occasion during that horrible crisis.

They TOOK leadership.

So, when the opportunity arises – or, especially, when it doesn’t – take leadership. Got an idea that you think your managers are missing? Tell them. They don’t like it? Tell their bosses. They don’t like it? Tell the CEO! Stand on his or her desk if you have to – shout your reasoning, advocate for your customers, do what you have to do. Think you are gonna get fired? Maybe. Think your wax-eared bosses are gonna do it their way anyway? Probably. Think it’s gonna build your leadership skills so next time YOU are the boss? Definitely.

So, take off your glasses. Wipe them clean. Now put them back on. See all those managers around you? You know, those idiots that have all the power, but don’t make any smart decisions. Guess how they got that job?

They took it.

If you aren’t being a parrot you aren't doing your job. If you aren’t being a parrot you aren’t doing your job.

chris — Sat, 31 May 2008 20:12:44 +0000

Repeating oneself is oft the grate of thine soul. We must do it to our kids, we must do it to our aging parents, we must do it to our neighbors, and we must do it to the lousy speech recognition in our nifty gadget. The last place we — the we of the coffee guzzling corporate manager horde — want to do it is…at work.

Damn it, these people work FOR you. So, why don’t they listen TO you? Heck, they should know how to do IT in the first place. And, if they can’t get that right, at the least they should listen to you and remember that you have already told them how to do IT. It doesn’t matter what the “it” is — “it” could be anything.

The point is: you have already told them “it”. And, they just don’t care. [Note to self: look for more caring employees during next spate of interviews. Um, how are you gonna discern “care” in an interview, buddy? If you start by groping and hope for a co-groping, your interview will be quickly over and that clink you hear won’t be that spoon in your coffee mug.]

Nope you can’t blame the misbehavior on caring; people do care, and they want to do a good job.

You can only blame it on yourself.

It’s simple: you haven’t repeated yourself enough.
It’s simple: you haven’t repeated yourself enough.

Your job as a manager is to set the tone and direction of workflow that you manage. You need to dictate this tone with concise catch-phrases which summate your direction. And, then you need to actually dictate them. And, then, repeat that dictation.

And repeat it.

…and repeat it.

…and keep repeating it.

…until employees hunch you are about to say it again.

…then keep saying it.

…until finally, they know you are going to say it. And then, akin to any anthem, people can even mumble along before being sufficiently goosed by their morning’s Starbucks. That’s when you have won.

Why all the repeating? Well, because, if *you* are not super clear about what *you* want, then how can those that work for you be even somewhat clear? In short, you must be razor clear to get vaguely blunt resonation below you.

Remember, mr/mrs. average/awesome/awful manager you just push paper. Your peeps actually do the work; they are mired in the details every hour of every day; it is they that slosh through the bog of your damned vision. And since you no slosh no mo’ your only function is to help them be more clear about what they are working for and be more efficient in the attainment of that vision.

So, what are some of the catch-phrases I repeat too oft? They are particular to my current company, so they may not make much sense to you, fine reader, but here goes:

Automation is salvation (we are a tech company)

M.I.M (measure, improve, measure vs. just running to improve something)

Communicate openly (our company tag-line)

Everything must breathe (for my marketing and engineers who like to make cramped copy)

1+1=1/2 (I made a blog post about this one)

CC your A$$ (Also blogged about this one)

Hey, bro, does my breath smell? (ooops, that’s from my unsuccessful dating circuit)

And, finally, one maxim my executive team has heard all too often:

If you are not being a parrot you are not doing your job.

So, you! Yah, you with the coffee mug! Gather up your scattered seeds, coalesce your crumbled crackers, and remember to always, always aim for the newspaper below. Your job, as of today, is to become a professional parrot!

The Motif of Motivation

chris — Sun, 13 Apr 2008 22:50:00 +0000

Finding and retaining talent — true talent — is damn hard in a company. Some bosses, whether consciously or subconsciously, want sycophantic workers. They would never tell you that, even with a few drinks in them at a bar, but their private, even autocratic styles, determine the ultimate caliber of the folks they hire.

But, for me (and hopefully for you too) this is not the case. I want to hire people that will shoulder some of the unbearable burden I feel as a founder. Heck, I want someone to take my job someday! Yet, therein lays the problem. How do you find and retain rockstars?

I discovered, years ago, that I could not simply find people that believed in the same things I did. I further discovered that people didn’t work or live for the same reasons. Everyone has their own unique motivation; and, it is precisely this motivation that is the key. If you can uncover someone’s true motivation, you have unlocked the ability to hire them, retain them, and ultimately free yourself of having a heart attack at 50, having the left side of your face paralyzed, and thereafter being forced to wear a bib for the rest of your life while you errantly stab the numb side of your face with plastic flatware whilst calling your sister “mom “ as she kindly pats you on the head saying “there there” — which consequently you can’t feel because it’s on left side of your head! :D

No, no, I don’t want that. I want sick talent! And, this means that I *must learn* their true motivations from day one. So, how to learn people’s motivations? Ask them. Bluntly. Right there during the interview process, just look ‘em in the eye and let it rip. And, don’t ask the obvious question, such as: “Why do you want to work here.” That’s a self-serving question. Ask them the harder questions, such as:

“Hey, you seem to be really, really talented, and honestly I am not sure you can learn more about your profession working with me for a few years. So, tell me, what do you really want? What is it that you really want to be doing with your life in a few years?”

People will usually hem-and-haw a bit and try the easy way out, but after pressing, I invariably get one of the following three answers:

I want to make lots of money
I want to aggressively grow my skill-set
I want to become a CEO or business owner

If I don’t get one of these answers, I either don’t have an honest person on my hands, or this person doesn’t give a crap. But, if I do get one of them, I get pretty excited, because it teaches me two things right off the bat:

It unlocks they key to hiring them.
It unlocks the key to retaining them.

So, as soon as I hear their answer, I immediately tailor the rest of the interview process around their central theme. Now, this may sound like lip-service to you — even bordering on a con-job, but it isn’t. Once they do come on-board, I keep my word. I make a sustained effort to tailor their entire existence at my company around their original motivation. In fact, I go to bed several nights per month and remind myself of many of their individual motivations. I call this “sleeping with my company.” Then, during the work week, I make an effort to verbally discuss that employee’s motivation right in front of them. That is the key — be verbal about their motivation. Remind them why they are working with you — because, sometimes, they forget too!

I will give you an example. When I was starting this current company of mine — waaaaay back in 2003 when it was just me, my scruffy bathrobe, and a zealous concept — I knew I needed a ROCKSTAR of an engineer. I knew I needed someone who was of higher technical acumen than anyone I had ever met before. And for me — a tech lifer — I knew that this was a tall order. So, after milking my network to the bone, I finally found the guy I knew I wanted. His name was Samy. And, I knew right away, that I had stumbled upon one of the best technical minds around. This kid was 16 years old, had already dropped out of high-school, was earning six figures, supporting his parents at his day job, and on weekends was moonlighting for an enterprise anti-virus company decrypting Russian viruses written in assembler code for $200 per hour. Um, hello Rain Man.

How the hell do you motivate a guy like that, especially when he so coolly told me during my first two attempts to recruit him:

“Chris, I get 5 job offers per week for more money than I make now.”

Wheeelp, I knew I couldn’t even match his salary. Via equity? Maybe. But, greenbacks? Never. So, money was out of the question. I also knew that I couldn’t grow him in his chosen profession. He was already my superior in that regard. And, I knew there was no wooing him with my smarts or dynamic personality…he would see right through that.

So, what to do? I up and asked him.

But I didn’t ask the obvious question. I asked him the honest question.

“Samy, dude, you are ridiculous at what you do. I am not going to bullshit you and tell you that my tech company is going to challenge you technically. If you want that you better go work for the government doing cryptology or for Google doing AI work. Look, I also can’t promise you that you will make tons of money. Sure I can promise to *try* to make you rich through equity, but I can’t guarantee it. So, tell me this: what do you want to be doing with your life in five years? Who does Samy want to be? Are you shooting to be the world’s best engineer in five years — aiming for the top of your class?”

<pause> (…wait for it…please don’t say yes...oh lord, please don’t say yes…)

“Well, um… I want to run my own business; I want to be a CEO.”

<halle-frickin-lujah> “Ahem, you want my job?”

<pause> <throat clearing> “hehe, uh, well, hehe, uh…I guess.”

“Well, Samy, as it turns out, that is the one thing I *can* teach you. I used to be you. I used to be das wünderkind tech whiz. I could program Perl so fast it would make your head spin. I could outdo a room of 4 under motivated engineers with my eyes closed. Yet, now, years later, I sit in front of you as a serial entrepreneur who has started three companies and made myself and a lot of other folks a bunch of money. How did I make that conversion? How did I make the leap from binary to boardroom, from memory pointers to management, from programming computers to actually leading people? How did I do all of this? Well, THAT is what I can teach you. And that is what I commit to you right now. Samy, if you quit your current job and take a huge pay cut and come work for me, I will teach you how I went from a 20 year-old engineer to a 30 year-old CEO.”

And, he did. Two weeks later he quit his six figure job, took a 60% pay-cut, and started commuting from San Diego and sleeping on my Los Angeles couch 4 nights a week.

But, I kept my word to Samy. I have kept his motivation on my frontal lobe for these past four years. “I go to sleep with that motivation.” As such, I have exposed him to the arduous fund-raising process. I have taught him how to read a P&L. I have taught him how to create deadlines and keep them. I have grown him from a single engineer to my Director of Engineering, managing dozens and dozens of engineers. I forced him to grow that team himself and learn how to motivate them and lead them and even do the dreaded for a young manager - fire people that are older than you. I even brought him to an official board meeting. You can imagine the surprise of my high-powered board of institutional directors when I showed up to one meeting with an 18 year old Samy in tow and said, “Hi everyone, meet Samy.”

So, that’s the key. Don’t learn their motivations to manipulate them. Actually *live* their motivations to keep *them* motivated. Maybe you will find, in time, as I have, that it will have an unexpected side-effect — keeping you motivated!

Dell, Inc partners with Fonality

chris — Wed, 23 Jan 2008 05:28:56 +0000

So, as you may have noticed, I don’t usually write in my blog about Fonality-specific business or products, nor do I take many comments about such. Rather, I like to focus on issues which I feel are broadly interesting to business owners, managers, and people who see crossovers between “life” and “business”. But, today, I’m going a bit off topic. I am going to write about something historic that has happened for “my” company, Fonality. I also feel this news is quite interesting to small-to-medium businesses (SMB) everywhere. OK, maybe that was a bit self-serving, but I do think it’s true. ;)

Yes, this is a *big* day for us. Actually, this would be a big day for any startup anywhere — struggling to establish its credibility in an aggressive tech world full of behemoths. This is a day we had expressly envisioned since day one at Fonality. In fact, I can clearly remember almost four years ago — to the day — when we (the four of us working at Fonality back then) were sitting around a room and hypothesizing about our plan to revolutionize telephony (isn’t that what all founders do when they are staring at the back of a napkin?). See, our aim back then was to build the world’s easiest-to-use and most affordable business phone system. We wanted this to be the first phone system that acted like a big business phone system, but was priced for small businesses. We even went out and trademarked: “Big Business Phone System. Small Business Price.” It cost us a couple hundred bucks and I remember not being happy about that.

So, we knew that to take a $17B industry and build a product that was *much* cheaper and *much* easier to use, while still *high* in features was no easy hat trick. But, we also knew that *even if we did build it* our next greatest challenge would be: reach. We asked:

“How will the whole world ever find out about our awesome new product?”

The answer was (in a joking way back then): we should do a deal with Dell. They have unbelievable reach and since our stuff has always run on a Dell PC, the fit seemed natural. Absolutely unattainable, yet natural. ;)

Well, that day has arrived! Today, after a year of careful vetting, Dell (NASDAQ: DELL) has selected Fonality as a go-to-market partner for offering VoIP phone systems to its small-to-mid-sized customer base. Dell spent 2007 scouring the market for telephony partners to serve its customer base. They were looking for two different types: an enterprise-focused solution for their larger customers and a low-cost / high performance solution for their SMB customers — one that could be self-managed. Dell has selected Fonality for the latter.

We all know that Dell is a huge company ($57B revs last year) and we all know they have massive reach. But, how to quantify that reach? Here are some numbers I was able to scare up (with the help of IDC): IDC claims that Dell has more than 28% market share in the SMB space in the US, with some 25M US businesses. This means that Dell could be delivering Fonality’s award-winning PBX and unified communications software applications (on Dell hardware) to around 7,000,000 existing small-to-medium business customers. That’s my rough math, but you get the picture — it’s a big picture!

So, why did Dell select Fonality? Well, I can tell you that it did not happen by accident — nor were we the expected choice. Some might ask: was Fonality selected because it is built on FONcore — the world’s most popular open source telephony project (we get over 1 million downloads per year)? Actually, no. Open Source is a means-to-an-end (lower cost and standardization) but certainly not the specific reason we were selected. In reality, Dell began with a list of three basic requirements (tenets that I have always felt are staples to their business):

must be high in value
must be super easy to use
must run on a Dell PC

Sounds easy, right? Nope. Any one of these items cuts the phone system playing field in half — all three of them together, narrowed the field in record time. Why?

Telecom has always been ridiculously high priced.

Fonality’s offerings come in way less than industry average (up 40-80% savings over “traditional” systems).
Telecom has always been ridiculously hard to use

Fonality’s patent-pending “hybrid-hosted” architecture reduces truck rolls; our easy-to-use management software reduces support calls and training time; our remote monitoring takes care of you behind the scenes.
Telecom has always been proprietary

Fonality’s open standards products were built to run on Dell’s standards-based platform from day one.

In my opinion, the most unique thing that Fonality presented over the competition was item #2. Our hybrid-hosted architecture was specifically designed to take the “hard” out of telecom. In fact, we don’t think anybody else in the industry is even doing hybrid-hosted (our filed patents may be part of that reason). This architecture of ours is a clever halfway-point between the old world of premise phone systems and the new world of hosted phone systems. Why would we straddle the fence? Simple. Each model has both strengths and weaknesses. We wanted to get the “good” out of them, whilst mitigating the “bad”.

What do I mean by the “good” and the “bad”?

So, we liked the old premise model because it has great quality and reliability (this is because it uses the PSTN/POTS/things-birds-sit-on). However, we disliked it because it doesn’t fit as well with a world that is increasingly going mobile. People are working from home, and from the road, using laptops, cell phones, and mail clients. They aren’t glued to a cube the way they were 20 years ago. And, to get any flexibility out of the old model, you need high-paid IT staff to manage complex VPN networks and firewalls. And, it still ends up being surprisingly inflexible. On top of all of this, you have to pay the “phone guy” to drive on site to do even simple changes to the system (such as adding an extension). Oh, he’s gonna run you north of $100 per hour. So:

Old model — great quality, lousy flexibility

Now, we liked the new model of hosted telephony because it provides great mobility to the customer, letting them work from home, from the road, pick up voicemail in their inbox, etc. The new model also allows for VoIP, which further saves the end-customer money. However, here’s the gotcha with hosted: it uses 100% VoIP, which may mean that your call sometimes ends up sounding like a Skype call. So:

New model — great flexibility, potentially lousy quality

So, we sat down and intentionally built a model that straddled both worlds. How does it work? We send the customer premise equipment (now a Dell PC), so they can connect it to their old phone network (of course it does VoIP as well). But, we also built four global data centers to help our customers work from home, from the road on a cell phone, or even on their laptop using a softphone. This means if a customer takes a phone (hard or soft) outside the office, it instantly registers back to their phone system. The data centers also handle moves/adds/changes to the phone system. This means that our customers can manage their phone system from a web browser anywhere in the world. Our data centers also keep track of changes so that a customer can have disaster recovery options. They don’t even need an IT staff to help them with their firewall or router. All of this was big for Dell.

So, yes, this is a big validation moment for hybrid-hosted. It has been a tough four years trying to explain our reasoning for this model — first to investors and then journalists and even our customers. They would all ask: why would you choose an approach that was exactly between the old-and-the-new? Our answer was always simple (well, to us, it was): the old has lasted us > 50 years, it is not going away over night. Quality on the old phone network will not be surpassed by VoIP for at least 10 years. And, we all know that 10 years is plenty-enough time for a few billion-dollar telecom companies to go bankrupt and plenty-enough time for a few billion-dollar telecom companies to be birthed.

Who knows where this will take us, but it certainly is a great validation of our technology. Also, it just goes to show you that those crazy sessions in the early, heady days of your startup can sometimes become your reality if you continue to persevere!