On economics and business

The science of economics should serve the smart business person the same way Marxism has done for the left banks of our academic institutions. Not much reliance in many an object of study as much as dependence on the economics' way of building up an hypotheses-based modus operandi.

Music Making and Business Leadership

Studying leadership is a very elusive undertaking. Understanding business leadership seems to be governed by the Heisenberg's Principle of Uncertainty: "The more precisely the POSITION is determined, the less precisely the MOMENTUM is known."

So, what is left to do for the student in business leadership, other than apprenticeship? HBR and its likes do a good job at giving one angles. Yet, few such proxies come as close to offering a meaningful metaphor about business leadership as music making. For my taste, of organization and music, jazz and classical will do. Let us proceed with some illustrations.

Take the case of a conductor. When dealing with a symphony, the conductor resembles very much your typical CEO. The metaphor changes when the conductor deals with a concert; the interplay with the soloist(s) becomes like the interaction between the CEO and the board or the CEO and a powerful president (of the board maybe.) Claudio Abbado, Herbert Karajan, and Sergiu Celibidache are just three examples of conductors--soft-, autocratic-, all encompassing-leadership, respectively.

With chamber music, you deal with a type of leadership from within. This is the case with consulting partnerships or teams with people at about the same levels of authority and experience. Dependence path is everything here.

In jazz, there are also a few models. The whole idea behind jazz--improvisation, swing, spontaneity, creativity on the move, etc.--corresponds nicely to the smaller entities (e.g. start-ups, workgroups.) Leadership in jazz comes in a few flavors. For example, Miles Davis is the all might and power derived from the authority of his knowledge and creativity. This type knows when and why to come in strongly or let things evolve on their own. John Coltrane is the ever present leader, almost a factotum of the group. This is the type that is all about his idea and ways of doing things. They turn ideas into start-ups. Mingus on the other hand is the type of leadership the exercises authority from behind, he's there only for those who know where/how to listen, he's the ultimate enabler. Jazz epitomizes, musically, the task oriented ad-hoc teams.

Obviously, chamber music and jazz usually offer metaphors applicable to smaller teams whose membership is similar in skills and culture.

For illustrations, have a look at the myriad of DVD's on musical subjects. Especially valuable, one is likely to find those that explain the mechanics of conducting by taking the viewer through a rehearsal. Click here to find a link to a wealth of sources on: Conductors and music making, as leadership metaphors!

Enjoy, and happy session-jamming out of Heisenberg-types of uncertainty!

Markets are conversations...

The Cluetrain manifesto

On management frameworks as metaphors

There is nothing new with how the (strategic) management frameworks or paradigms proliferate--there is a flow out there coming from academics and 'high-powered' management consultants. The utility of such flow is unquestionable for the authors , and to some extent, for the general readership as well. For a practitioner or general interest reader, I suggest the following: Look at these as mere metaphors meant to inform your decision making, and exercise your brain. When solving a problem, one may consider elaborating and deploying a hypothesis-based methodology. Such methodology ought to be informed by what one reads / learns (management frameworks included) and, more importantly, must contain elements of the following cycle: observation(s) --> concept --> testing --> implementation --> measurement --> observation. Hypothesizing should take place especially in the observation and concept phases. In the testing and measurement phases, one ought to see how good one's initial hypotheses were. Obviously, one can play with the above elements as one wishes on the condition that they all come down to hypotheses and (in)validation. Just a thought...
"[S]cience seems impotent to explain the music of chance..."

random thoughts when starting a (technology) business...

Be an evangelist for what you believe in, and what you do. First, it helps you get few like-minded people around you, later it will help you spread the virus of your enthusiasm for the product to partners, money managers, and customers.

You probably start out with a product/service idea for a company and, what is equally if not more important, with a vision. The vision may be about what you and your company will (not) be about. The quality of your vision, pushed by your enthusiasm, is a good measure for the type of people you'll initially attract.

Know what you know and what you don't know. Letting others do what you do not know is vital. This is true at a personal level and company level as well. Focus on your strengths in each case.

Invest in people. Besides selling in a broad sense, investing in people is your most important activity. You'll be amazed by the returns in, let us say, those two instances out of ten when you trusted and invested in people. The happy returns will outweigh by far the five unsatisfactory ones. Never forget to give another chance to the other three by changing assignments, etc.

Understand the role of venture capital money and do not hold on control all costs. Control is the only token of exchange you'll have for a long time. No sin in trading the control at a premium if you can, but stay reasonable.

The most expendable commodity is your own pride!

For you, the founder, titles (should) matter little. This may not be so for the others. Keep this under consideration.

Organic growth (i.e. from within) is the best. Time will tell you that 'organic' may also be just a dream. Quality may be traded-off for speed when growing--when you consciously make this decision look at it as ebb and flow, thus consider always the first opportunity to prune the growth.

Once started on a path, make sure you do not share your 'last night dreams' with your technical folks. They often take those as directions in which to steer their focus. Hedge carefully your words!

Thresholds for growth:

1) Getting the first 2 or 3 around you. Everything floats in the air. High energy levels and great synergy. Chances are these will be your friends for a long time.
As early as this stage, put down on paper some details related to the mechanics of the organization (e.g. ownership quotas, dilution cycles, handling and management of default states/exceptions.) If done well, this will help you build the culture for your future company. Culture being that combination of written and un-written rules that govern the functioning of your organization. A good culture is the first premise for being effective and, on top, efficient--as in strategic and tactic. This is the DNA formation stage. Here's when you decide what you want your company to be.

2) Between 5 and 15 employees: It is still honey-moon. Enjoy the extended family and stay focused. Add some metrics to the culture and think ahead. It's a good time to evaluate the quality of the second wave hirees. If brighter/more specialized than the first wave then you may be on the right track. Now it may also be the time for you to decide who's going to be the CEO. Do you enjoy or are the most productive thinking of paychecks, benefits, legal issues and such? Those missed payments and such won't be ever forgotten.

3) Between 15 and 25 employees: You may no longer know everybody by their names. What you are as a company at this stage is a good predictor for what you'll be in the future. It's time to think partnerships. Shy away from exclusivity in your partnerships. Get to know very well your customer--it's the only asset you'll have in a changing world. This may be the time to call in services provided by entities such as those represented by the undersigned. Considering options and intersecting them with capabilities, bringing clarity and definition to what you (want to) do, have a multiplier effect!

4) Between 25 and 50 employees: Congratulations, you've made this far! Here's where you have to decide the strategy of your company as a grown-up. Venture capital involvement in this process may be unavoidable. Your company is proof you've done something right and worth scaling up. Strategies to consider are: tie yourself to a large and generous platform (e.g. Microsoft's .NET, IBM's WebSphere, open source,) grow through IPO, venture money, organically. Exit strategies may come into the picture--at least for the sake of fund-raising and/or employees' morale. Here's time to see what you can be. Make sure you have clear lines of communications and authority in the company.

5) Between 50-150. I'm glad you are still there! It's time to think channels. If entrepreneurship is your state of being, it may be time to arrange for a gracious exit--depending on the vesting schedules and such, of course. By your leaving, make sure the people behind won't fell like the sky is falling, you may still be emotionally invested, if not materially, in the success of the company.

6) Happy surfing wherever life might have brought you, and don't forget, you are among the lucky 10% who ever make it this far!