Public / Private

I have been watching with interest the debate sparked a few days ago by the Samaritans’ “Radar” Twitter app.

In case you’ve been marooned without your mobile and haven’t seen what’s been discussed, it boils down to this:

  1. The Samaritans, a UK based charity dedicated to helping those suffering with depression, launched an app allowing friends to keep an eye on their friends’ Twitter postings, and have the Samaritans app notify them if it picked up a pattern which corresponded with symptoms of depression.
  2. Others, however, object to the Samaritans app “listening in” on their tweets without their knowledge, and want the app to be blocked.

This is a really good illustration of the way in which our society hasn’t yet caught up in social terms with the technology that is widely available to all – and also highlights the difference in the approach to social media taken by the different generations.

First let’s remind ourselves that anything that we post on Twitter is publicly visible.  We can take steps to restrict access to only “approved” people, but can’t then stop these people repeating our tweets to their public following.  Even with Facebook, which claims to limit the sharing of information to friends only, many have come to share my personal approach which is to assume that come

The problem comes because even if we accept at a certain point that we’re posting in a public forum and that our comments (and spelling mistakes) are visible to all, we are not yet well equipped to understand the consequences of three key facets of social media:

  1. Our posts are permanent, they stay visible and searchable for years.
  2. Our posts are not held in isolation, but can be cross-referenced so that Twitter and Linkedin profile information can be combined.
  3. Our posts are readily accessible and readable by machines.

Ironically, whilst the more white-haired amongst us are used to a deep suspicion of technology, and the assumption that sooner or later someone will accidentally manage to create the matrix, skynet or some other movie-themed-evil, it’s the young who seem to be more readily caught out.

As our digital reliance increases, we’re being presented with simple transactions: “share this information and I’ll give you that piece of value”.  What we need to be aware of, though, is that once shared, new uses can be found for our information which we hadn’t thought of.

One way to approach this is with a sense of rising alarm, asking for things that we’ve shared publicly to be hidden again after the event.

Another approach however, might stand the test of time better, and that’s to maintain a line between the public and the private and ensure that the public side of that line is always addressed with propriety.

I’m reading Dickens at the moment, and spending some time in an era when one’s letters, once out of one’s possession, become a risk to one’s reputation which might lead to disgrace and ruin; makes me realise that we used to know that once shared – we have no control over what we have said or meant – maybe it’s time to remember that.

Downtime

Downtime is a bit of a dirty word in my business, and in the context of our web product: CreditHQ being “down” is inconvenient to our customers and a major cause of concern to us.

But there’s another type of downtime which we have deliberately built into our business, and which we find is incredibly helpful.  As a software company, we run a process called Scrum, which means that every two weeks, we take a day to deliver back everything we’ve been working on for the previous fortnight, review it all together with our chairman and key stakeholders and then plan what we’re going to do over the following couple of weeks.

What we’ve found, is that even the parts of our business that don’t really follow this two week cycle (operating our our marketing campaigns for example, which don’t take a day off ever!) do benefit from the opportunity for a bit of downtime.

So why is this helpful?  Well we can all understand that a small and rapidly growing company is a pretty “full on” environment – there’s always a long list of things to do.  Building in a two week cycle though, delivers three real benefits to us:

1: We are human!  That means that as well as a daily cycle where we work, rest and play, we also really benefit from a longer cycle to vary the level of stress we operate under.  Sure we work hard and have to deliver on deadlines, but if we tried to do that all day every day, we’d burn out our team members pretty fast, and that’s not good for anyone.

2: We need perspective.  When your nose is right up close to the detail, it’s easy to lose perspective – to lose sight of the big picture – and that means that people miss stuff, which is bad for business.

3: Stuff changes.  The key advantage that any small business has is its ability to respond quickly to changes in the world around it.  A small business can take advantage of a change in the commercial environment, a new technology, or a new business model far more quickly than a larger business can, but only if the people in that small business take a moment to stop and look around.  We have found that the deliberate practice of stepping back periodically gives everyone in the business a chance to take on board changes – sometimes just a small nudge in the right direction, but sometimes a more significant course change.

So can your business benefit from downtime?  Give it a try: schedule a couple of hours to take a look at the big picture with your colleagues – and don’t forget the tea and biscuits!

At amazon, it's about cash flow. And what you can get away with…

Amazon is well known for rapid growth but relatively low profit – its founder Jeff Bezos famously asking shareholders to sacrifice this year’s profits in order to invest in long-term customer loyalty and product opportunities that will create bigger profits next year and for years to come.

But the real story behind Amazon’s ongoing growth is shown not so much by its profits, which dipped in 2012 after a few years of growth and have yet to return to 2010 levels, but by its cash flow.

Every small business knows that “cash is king” but it’s somewhat of a surprise to see larger companies paying quite so much attention to it as amazon clearly do.

Amazon’s Cash Flow vs Profit – (C) HBR Blog

Amazon’s strategy hasn’t been about profit, it’s been about growth, and the reason that amazon has been able to grow so dramatically into many different areas in recent years is that they have the operating cash flow to do it.  I’d recommend the HBR article for the details, but long story short?  Amazon, just like a small business, have held profits low by reinvesting much of their free cash in growth – and have boosted the availability of that free cash.

With such a strong position in the minds of customers, Amazon are using their ability to shift a high volume of product to negotiate very long payment terms with their suppliers.  As a growing profitable company, their credit is good of course, so in return for access to volume (and many other benefits) suppliers are putting up with very long payment terms – quite simply it’s worth it.

Can your business start the virtuous circle that Amazon have found?  Good cash flow fuelling growth, fuelling good credit, fuelling good cash flow? Or are you extending credit where credit’s not really due?

It might be time to take a leaf out of Amazon’s book.

Or at least some reading from the excellent hbr.blog

Happiness is a Journey, and so is Profit.

I came across this little meme recently, reflecting the school of thought that says, in effect, that happiness cannot be achieved as an objective in and of itself.  This may challenge the American Declaration of Independence, by implying that the pursuit of happiness might be counterproductive but it does provide a simple explanation as to why, having been persuaded by advertisers that we should by the latest gadget/game/car/trinket in order that we are happy, we then find that we’re disappointed.

I was then struck that when we talk about not being happy, we often refer to a reason “I wasn’t happy about X”, but when we talk about actually being happy, we’re less likely to say that we’re happy because of something – rather we’d say that we’re happy with a certain result: “I worked really hard to get this right, and I’m really happy with it”.  So if we set an objective and achieve it, that’s where the happiness part comes in – but we don’t talk about setting out with happiness as the objective in the first place.

The reason that this daydream made it all the way to wordpress, was because of the parallels with John Kay’s very interesting “Obliquity” which I read recently.  He proposes that, like happiness, profit isn’t an objective you can seek directly, but rather one which happens as a by-product of seeking another objective – one centred around creating value for customers – and doing that really well.  There are indeed some great examples in that book of companies whose corporate objectives are re-aligned from one style to another and who can see a clear result in their fortunes directly following such a move.  This actually makes a lot of sense when you think about it – companies who focus on extracting profit might have the best sales people, the best lawyers, and the best accountants, but that doesn’t actually generate value for those companies’ customers.  On the other hand companies who set out to do important work, and who achieve it-especially if it’s difficult, are actually generating genuine value, capturing that into profit is then much more straightforward than trying to generate profit where there’s no intrinsic value.

So the takeaway from this for a small business? It feels good to know that whilst lawyers and accountants have their place, a business shouldn’t be driven by them, but instead by achieving important work that generates value for others.

What’s more, it might even make you happy.

DIY Employees

In recruiting, it’s often tempting to paint a glorious picture of what your small business has to offer to the potential employee, indeed as the employment market hots up – it’s likely you’ll be competing with companies with deeper pockets and swishy benefits.  But in putting together this “gold plated” experience for new members of the team, are you really going to find the right employees to make a real contribution to building your small business.

I advocate an alternative route, and it’s one which doesn’t meet with universal approval.  As a small business, we don’t have a corporate IT department, or facilities department, or a tea trolley for that matter, and so we need to recruit team members who are on the lookout for what needs to be done and who are prepared to get in and do it.  When interviewing candidates, I think it’s important to make it clear that the relaxed environment and informality of a successful small business are only possible if everyone’s willing to muck in and pick up the jobs that need doing.  This isn’t to everyone’s taste of course, and it’s a useful thought process for a “big company” employee to go through before deciding whether they really want to leave the cosy world of the well defined corporate job and venture into the exciting world of small business.

To bring this into the very sharpest focus, and help employees understand that we’re serious when we talk about self starters, our new starters are presented with a checklist on joining the team, and not too far down after the mandatory health and safety briefing comes the line: “Assemble furniture”

Observing what happens next will both tell your team a lot about your ethos as a company and also tell you a lot about your employees.  Whilst your interview process will have tried to screen candidates for how proactive they are, how they respond to new challenges, how able they are to follow unfamiliar instructions, how willing they are to ask for help, how they collaborate etc, the interview process is a notoriously difficult environment in which to assess these characteristics.

After a couple of hours with an Ikea desk, chair and pedestal drawer unit, however, you’ll have an excellent idea which new starters are going to get on well with life in a changing, growing small business.

Add to that the added sense of achievement when the team members walk up to their newly installed workstations, all made by their own hands, and you’ll see why I’ve been an enthusiastic advocate of DIY employees.

In case you’re wondering, yes, the desk at which I’m writing this was put together by yours truly.