A couple of years ago I wrote

A corporation isn’t an entity at all. It’s a group of people, with shared values, all moving in the same direction, united in a shared vision and their efforts to reach a common goal.

Lou Gerstner, who remade the culture at IBM, most famously said,

I came to see, in my time at IBM, that culture isn’t just one aspect of the game, it is the game.

The culture continued to change when Sam Palmisano took over.

…the biggest breakthroughs are a result of changing the business model and the processes and the culture.

Microsoft’s Steve Ballmer learned the hard way that culture can’t be changed by edict, whereas Satya Nadella’s approach succeeded.

Over the last year, 110,000 strong Intel has been changing under the leadership of Robert Swan, who considers the cultural change necessary for its survival.

Its culture badly needed an overhaul, and its 110,000 employees needed to confront issues more openly.

“If you have a problem, put it on the table,” said Mr. Swan, 59, who was promoted to the top job a year ago and has since embarked on a campaign to shake up the Silicon Valley giant.

His efforts remain a work in progress. But the changes — some of which lean on the precepts of Andrew S. Grove, the former Intel chief executive who coined the credo “Only the paranoid survive” — are Intel’s biggest attitude adjustment in decades.

The underlying cause is the same as Gerstner and Nadella faced at their companies: complacency.

Complacency, from years of dominating their markets, and silos, from internal distrust and myopic communications.

Intel was the same.

Intel also had deeply rooted problems reflecting its years of dominance, Mr. Swan said. Managers, complacent about competition, battled internally over budgets. Some of them hoarded information, he said.

These are the same problems that companies of all sizes face.

No matter how dominant times change and competitors can seize the day.

While success is often seen as a case of “us” vs. “them” it’s crucial to remember that “us” includes customers, partners and all parts of the company.

Image credit: Aaron Fulkerson

Today we welcome Marc Dorneles, another new voice at MAPping Company Success. Marc is a very untypical commercial insurance broker whose employer won B Corp status (definitely not the norm in his industry), plus he’s extremely knowledgeable about startup needs. (Click About Marc to learn more.)

There it was and here we are, Post Seed Conference SF 2015. There were many pearls of wisdom and insight offered at the event by the likes of John Doerr of Kleiner Perkins and others substantiating its strong attendance. From, Ideas are easy, execution is hard and the notion of challenging thinking to the more precise strategy of Empowering, encouraging OKR’s (Objectives Key Results) because it gets Alignment and Operational Excellence.

It was the place to be if you wanted to hear more about the key ingredients for a leader in the start- up environment. Namely; technical expertise, outstanding leadership, strategic focus on large opportunities, reasonable approach to finances, and having an incredible sense of urgency.

It reminded us that story telling, show and tell, is critical. Equally as instructive; a question to ask yourself when entering any partnership is: do you want to make mistakes with this person? Said another way, can you have the attitude with them that “I’ve got your back, let’s go tackle this problem together.” 

There were market insights discussed such as the analysis that there are approximately 200 unicorns in the world, “Americorns” being a substantive number of them. Today’s dollars are a third of what was around at the height of the boom, making it less likely for unicorns to get acquired. Even a little antidotal comedy, like Unicorns are often albatrosses and bottom line focused zingers quoted from the likes Bill Campbell were offered; “all that matters is that we achieve operational excellence.”

The conference identified markets that comprised major opportunities, such as 

• the online ad market which is at half a trillion dollars. Likewise;
• US Healthcare which is bigger than all but some three economies;
• Public Education;
• Transportation; and
• rounding out with batteries (projected to be three time’s better than they are today)

as additional significant opportunity sectors. Overall market perspective was given: downturns are good things because more attention is given to the outstanding startups.

Operational consultation ideas were shared by many veteran experts including Christine Herron of Intel. Ideas such as, don’t over-capitalize, think long term, and have guts or that venture capital is not the end, it’s a means to an end. When looking for funding, don’t worry about the financing market, focus on the business. Don’t worry about unicorns. Consider “Optionality” i.e. keeping options open, looking for those with large upside and little downside. Rounds are taking longer to close. Be patient.

Concerning founders, a big key is learning.

• Anticipate pre-launch, scaling issues.
• Focus on process and measuring.
• Know that rigorous hiring is extremely difficult and that the best talent usually needs to be lured away from other opportunities.
• Long term, keep in mind that people who started with small companies don’t necessarily want to be there when they’re bigger.
• Four major cities: SF, NY, LA, Boston are the most sought after locals. There’s a significant importance to understanding and adapting to local markets.

Focus on what is needed to prove key initiatives. Questions and actions such as,

• How much did you raise?
• How much accomplished?
• How long is the runway?
• Know exactly what the other side means.
• Avoid grey areas.
• Create your deck around the most effective metric, which is traction!

Keep in mind that investors roughly don’t invest 95% of the time because 40-60% of investments in startups are complete fails but have confidence nonetheless.

Traction = Execution. As soon as you raise equity round, get VC. Never letting company run out of money is the #1 job. Pressure your investors to use their network. “ABR” – always be raising. Don’t be concerned about dilution just raise as much as possible.

Vinod Kholsa generously shared some particularly brilliant insight, imparting the functional dynamic that value equals perception and the perspective to ask what’s valuable about the company. He went on to emphasis that the core business is much more important than valuation which is peripheral to long term success. In addition, to keep in mind, what kind of assets are you adding for long term success? How you approach people – extremely important. Be humble. Where are you today? Is most important. What risks do you need to eliminate or reduce in the next 12 months?

The analogy was made of having a good base camp, meaning a stable business with decent returns. Think big, act small. Think about Everest but plan to get to base camp first. The single biggest help a VC can give is to figure out who you need on your team. A company becomes the people it hires.

Understand the risks you’re taking. Sequencing which risks you prioritize is very important. You want people who will push you to ask the hard, not easy, questions. Talk to as many VC’s as you can. Find out what they think of your risks! Have a plan to eliminate risks one by one.

Wrapping up it was discussed that seed stage investing is both harder and easier than ten years ago because entrepreneurs are more sophisticated, but there are also more VC’s. It also speculated on what the future holds noting the impact of machine learning, which will replace most jobs.

The recognition that there is abundance and income disparity increasing at the same time was also made and that income inequality will have to be addressed. It was speculated that more than 50% of jobs will disappear.

Entrepreneurs have the opportunity to create technology. However, emotional elements can’t be replaced, which is exceptionally valuable knowledge.

The fact that the human element can’t be replaced leads to this article’s concluding point, i.e., why conferences like Post Seed are so valuable!

Dozens of ugly stories in 2014 threw a spotlight on the lack of gender and color diversity and the prevalence of bigoted and frat house/misogynistic cultures in tech.

Individuals and companies are speaking out vowing to change things — talking, talking, talking.

Intel, however, isn’t talking; it’s putting its money where its mouth is.

Intel said it has established a $300 million fund to be used in the next three years to improve the diversity of the company’s work force [goal of 14%], attract more women and minorities to the technology field and make the industry more hospitable to them once they get there.

The big difference between what Intel is doing and the rest of tech is not just focusing on STEM training and recruitment, but on changing the workplace so that those who join tech will stay in tech instead of being driven out by the current culture.

Changing culture is difficult within a company, let alone within an entire industry.

Google is already working on it, while most companies are suggesting/funding issues that are external, such as education.

Hopefully, the clout and funds that Intel is bringing to the table will makes a difference.

Image credit: Intel Free Press

Generational splits are nothing new; throughout time those under X have clashed with those over X.

While the typical under/over split is alive and well, there is a new dimension in the world of technology and it’s clearly on view in Silicon Valley.

In pursuing the latest and the coolest, young engineers ignore opportunities in less-sexy areas of tech like semiconductors, data storage and networking, the products that form the foundation on which all of Web 2.0 rests.

This is far more serious than differences in fashion and music; this split has serious implications for the economic future of our country. (Read the article; it’s important)

Building the latest, greatest app might make the creator rich, but even a few Google’s and Facebook’s aren’t going to do much to rebuild the middle class.

Doing that takes thousands of jobs at a multitude of skills and levels

The kind of jobs created by breakthrough technologies that create entire new industries as did semiconductors.

But that kind of innovation requires focus and time—not just a few months to a fast cash out and bragging rights.

So what’s the answer?

Somehow we need to find a way to make that kind of work cool.

Flickr image credit: opensourceway

Buying startups and shutting down their business in the name of acquiring talent is a hot trend—and one easily destined to fail.

Talent retention in ‘acqui-hiring’ fails most often for the same reason it has always failed—culture.

And before anyone offers the ‘large company culture vs. startup culture’ argument let me point out that Google and Facebook are large companies, not startups.

Retaining acquired talent isn’t a new problem and I addressed it in 2006 from the other side, i.e., a young company wanting to maintain its culture as it acquired smaller companies.

Realistically speaking, I don’t care how cool the culture and perks at Google and Facebook are, there is no way they or similar companies can provide true startup culture, camaraderie, or environment.

But it is amusing (if you don’t own their stock) to watch them try.

In the same vein, why is it so surprising when long-term employees leave?

The media loves to feature stories about turnover at Google, Facebook, Zynga, Groupon, Amazon, even Microsoft and other startup-no-longer companies, while ignoring the same turnover at Cisco, Intel and. IBM

When will they learn?

Those who get a thrill creating something from nothing and building foundations may start losing interest when the scaffolding for higher stories goes up and become totally disinterested when the walls go in.

High salaries, excessive stock options, even powerful positions may hold them, but retention doesn’t always translate to productivity or cultural harmony.

All I can say is caveat emptor and don’t whine if (when) it doesn’t work.

Flickr image credit: AKZOphoto

I never did understand the frenzy around startups and small biz as an engine for job creation, but I kept still—no one makes a fool of themselves intentionally.

Then last July I read an article by Andy Grove about what it takes to create jobs and my thoughts didn’t seem quite so ignorant. In September I read that after the first rush of hiring small and large companies are fairly even regarding job creation.

I also couldn’t understand the economic value of companies such as Groupon, Twitter, Zynga or even Facebook. I really couldn’t see how new ways to sell stuff was going to rebuild the middle class; it just didn’t seem that anything new and real was actually being created, but I didn’t broadcast those heretical views, either.

Now I’m seeing my heretical ideas voiced by people with cred.

So if this tech bubble is about getting shoppers to buy, what’s left if and when it pops? [Steve] Perlman [founder or WebTV] grows agitated when asked that question. Hands waving and voice rising, he says that venture capitalists have become consumed with finding overnight sensations. They’ve pulled away from funding risky projects that create more of those general-purpose technologies—inventions that lay the foundation for more invention. “…But they are building on top of old technology, and at some point you exhaust the fuel of the underpinnings.”

Beyond all this is the fact that selling stuff requires a strong middle class to buy it and even startups with real products aren’t contributing to the manufacturing jobs that underpin that same middle class.

“The scaling process is no longer happening in the U.S. And as long as that’s the case, plowing capital into young companies that build their factories elsewhere will continue to yield a bad return in terms of American jobs.” –Andy Grove

China and India are consumer powerhouses not because of their newly minted uber-rich, but because of their growing middle class.

Most of this has been said in one way or another, but it doesn’t seem to have sunk in. I certainly don’t have the answers, but I am sure that the conversation needs to become a lot louder before anyone notices, let alone takes action.

Image credit: Flickr

Article first published as No Help Wanted on Technorati.

Fit.

Fit makes your clothes look great; fit makes your shoes comfortable; cultural fit drives success, whether corporate or personal.

Just as one-size-fits-all doesn’t apply to great fitting clothes or shoes; it doesn’t apply to company culture—think Zappos and Intel.

Some great people love highly political environments; they consider politics a game and thrive on playing, while others shrivel and die in that situation.

A good friend interviewed at Apple when it was young and hot. She wanted to know about the work, but the interviewers only talked about the campus gym and Friday beer blast, which turned her off.

The true secret of success, both individual and corporate, is fit.

• For companies, the kind of culture is less important than whether the people hired are a good fit—not to the propaganda, but to the cultural reality.
• For individuals, it’s not really about free massages, catered lunches and foosball, but about how well the company’s values match their own.

Another bit of stupid is the idea that startups/small companies have great cultures, while large, established companies are boring and regimented.

In fact, if you really listen, you can hear the assumptions behind the media chatter on culture—assumptions that a little thought renders ridiculous.

Time spent evaluating and testing cultural fit always pays off, whether you’re a hiring manager or a candidate.

Flickr image credit: http://www.flickr.com/photos/zedbee/103147140/

I have only two items for you today, not because they are longer than typical, but because I hope they will stimulate your mind as they did mine.

First, a provocative essay from Andy Grove, Intel’s legendary CEO, now retired, but obviously not from thinking. In it, he explains why startups aren’t really an engine for job growth what actually needs to happen.

[New York Times columnist Thomas L.] Friedman is wrong. Startups are a wonderful thing, but they cannot by themselves increase tech employment. Equally important is what comes after that mythical moment of creation in the garage, as technology goes from prototype to mass production. This is the phase where companies scale up. They work out design details, figure out how to make things affordably, build factories, and hire people by the thousands. Scaling is hard work but necessary to make innovation matter.

The scaling process is no longer happening in the U.S. And as long as that’s the case, plowing capital into young companies that build their factories elsewhere will continue to yield a bad return in terms of American jobs.

Now for the real mind bender.

Are you familiar with the Singularity?

…the arrival of the Singularity — a time, possibly just a couple decades from now, when a superior intelligence will dominate and life will take on an altered form that we can’t predict or comprehend in our current, limited state.

At that point, the Singularity holds, human beings and machines will so effortlessly and elegantly merge that poor health, the ravages of old age and even death itself will all be things of the past.

Some of Silicon Valley’s smartest and wealthiest people have embraced the Singularity.

Read the article, read some of the links, think about the pragmatic, ethical, moral and religious aspects, then come back and share your thoughts.

Flickr image credit: http://www.flickr.com/photos/pedroelcarvalho/2812091311/

I have four great lessons for you today.

1. arrogance doesn’t burnish your image;
2. don’t hesitate to tell a client they’re wrong when you know they are;
3. don’t just focus on what you’re doing for customers now, but what you’ll do for them in the future; and
4. culture sells.

They’re all wrapped up in a story about Intel’s new advertising plan and Venables Bell & Partners, the agency that’s doing it.

Lesson 1: In a nutshell, Intel’s concept of the branding effort was “we’re so important to your everyday life. Imagine a world without Intel. Your lights would go out. The world would stop revolving.” That’s arrogance.

Lesson 2: In a second nutshell, “Venables Bell said, ‘You got that wrong.’” Telling an account the size of Intel they’re on the wrong track takes guts.

In Silicon Valley Intel is a cultural icon renowned for its technical brilliance, innovative R&D and decidedly quirky culture.

Lesson 3 & 4: VB did an in-depth study of the company and hung out with its engineers; you’ll be seeing the results starting next week.  The campaign’s tagline is “Sponsors of Tomorrow,” and the ads highlight achievements of Intel engineers in a humorous way.”

Share the ideas with your team; then work together and tweak them to sell your company, department or team to those for whom you perform, whether your customers are external or internal.

Your comments—priceless

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