Avoid trouble, Kill the monsters when they’re young
By: Don Rainey
Tags: Startup, Startup Lessons, Problem Solving, Big Idea

I’m sorry to break it to you, but having a “big idea” isn’t the critical driver of startup success. The essential driver of startup success is the best execution of a big idea — while making a few mistakes along the way (or at least low-cost ones when you do.).

A great idea, no matter how revolutionary, is only the start. To succeed, a startup has to maximize successes while minimizing setbacks.

Entrepreneurs are optimists. If they weren’t optimists, they wouldn’t be able to create something from nothing or overcome the odds to create a growing enterprise. But their optimism is ultimately a two-edged sword. The confidence that gives them strength to persevere can also blind them to growing problems in their way.

As a result, entrepreneurs typically aren’t as well attuned to heading off trouble early. Trouble is inevitable. Things go wrong. Employees make mistakes. Stuff happens. Trouble happens. And when things go wrong, the longer problems aren’t dealt with, the bigger the issue becomes. Problems can start small and grow big at worrying speed. Deal with these monsters when they are still small, before they have a chance to grow.

To spot and kill problem monsters, before they get too big, ask these three questions.

Are your current issues problems or symptoms of problems? What are the next five things likely to go wrong? Are you dispatching troublemaker employees?

Problem or symptom?

Problems often manifest multiple symptoms. Fixing symptoms won’t solve problems, whereas fixing root issues might eliminate numerous symptoms. A comprehensive inventory of symptoms will make problems easier to spot.

For example, take a look at customer retention. Often when customer turnover is high, management believes that the customer service representatives are failing. That may be true. However, customer turnover can be more complex; causes often include sales setting false expectations, product flaws, or poor installation rather than actual customer service. Training customer service representatives does not eliminate the fact of weak sales projections, nor does it improve product quality or streamline the installation process. Fixing the perceived symptoms won’t solve your actual problem.

Go the extra mile upfront before pursuing a resolution. When a customer leaves, don’t accept a pat explanation. Speak to the customer if you can. If you can’t, deconstruct their interactions with the company over the last six months. It sounds funny to say, but the commonality of lost customers is often a single employee or process. That problem will exhibit several symptoms. Make sure you are eliminating the cause of the problem instead of merely treating symptoms.

Know the Next five things Likely to go Wrong

There will always be surprises. Unforeseeable events are a fact of life. But it is foreseeable that the majority of your problems will be from predictable sources. You should always know the next five likely things that could go wrong in your business. Are you prepared with the steps you will take when one of those things does go wrong?

Ask yourself, “Where are the single points of future failure? “Which people or systems are the most stressed?” as well as “Who are the weak players on the team?”

Instead of worrying, start building lists. Anticipate problems and their resolutions. You may have the time and money to deal with potential issues, or you currently you may not have either. Thinking about future issues puts you a step ahead for when systems or people fail you.

Let’s use a high-quality problem as an example. You land the largest customer in the history of your business. Landing the customer was a great challenge, but your efforts paid off. After celebrating the victory, build a list of the five things you would do first if the customer walked.

Or your production relies on a single piece of machinery. It is costly to replace, and one day it will fail. What exactly will you do on that day?

The joke told about banks is that they will never give a loan when you need one. The point is to get that loan before you do need it. The future capital restraint is a young, small monster. Deal with it now, before it’s a big one.

Deal with the troublemakers quickly

I think the world record for successful hiring is a ratio of three successful hires out of four made. Initial impressions aren’t always correct. Reality can clash with hope. Admit your hiring mistakes without hesitation and move on. Trust your gut on employees unlikely to work out. Don’t think they need more time to adjust or to figure out their job. They don’t.

Managers more readily fire people for being a jerk, rather than incompetence. The jerks will self identify, while the incompetents will not. You have to identify both the incompetents and the jerks, and get rid of them fast. Nothing brings down morale more than having non-winners on the team.

People are the source of many of your problems. When I was running a startup, I had a policy where employees who were dealing with an angry customer could offer to transfer the customer to me, the CEO. Upset customers would universally agree to share their issues and get connected to me. It was an ongoing source of symptoms and problems in the business. And nine times out of ten, it was ultimately an employee-sourced concern. Sometimes my employees had been jerks, but most times, they hadn’t done their job well. Talking directly with unhappy customers allowed me to discern quickly if my employee was the problem — I got to root out jerks super fast. And if my employee wasn’t the problem — I was also able to examine if I had a process or product issue.

Companies grow and thrive by meeting challenges, overcoming problems, and making significant strategic and tactical decisions. You won’t have all the answers to the issues you face. The point is to consider the problems and solutions before they are needed. Kill the small monsters before they get too big.