Quora Answer: Should Startups “Hire” a Founding Investor?

The following is my answer to a Quora question: “Should startups ‘hire’ a founding investor?” 

The question conflates three things: founder, investor and employee.  Founders are the owners of the business.  Their interest is to grow the startup and enhance its market capitalisation.  Investors put in money into the business to extract value from it through cash cow or various forms of exit.  An employee is paid to perform a specific job so that the startup can generate revenue in excess of the cost of hiring him.  What is a “founding” investor?  This sounds like an oxymoron.

Quora Answer: Should Eloquence be a Yardstick for Competence?

The following is my answer to a Quora question: “Should eloquent speech or fluency in any way be a yardstick for competence?” 

Being eloquent is an indication of competence in the arts of communication and rhetoric.  It is not an indication of competence in other spheres.  You judge competence in specific spheres according to the markers of those skills, not eloquence. 

Being fluent in a language indicates competence in utilising it to communicate, adherence to grammar, and possession of sufficient vocabulary.  Fluency in language is not mastery of it.  Fluency in one language is not an indicator of fluency in another language, let alone being a gauge of competency in skills that do not require that fluency.

Quora Answer: What Should Startups Expect from Board Members?

The following is my answer to a Quora question: “What should startups reasonably expect from their board members?”

In a startup, the members of the board should ideally be more experienced than the founders, if the founders are new to business.  If the founders are themselves established in the industry prior to founding the company, then the board members should be of equivalent experience. 

Board memberships are given out for a reason.  These people must add value.  Either they have experience, access to funding, have a network, or bring something else to the table that would enhance the value of the company in preparation for exit.  In specific situations, people are offered membership of the board because they represent certain stakeholders or investors.  They are there to represent the parties to each other.

Some People Should Never be Leaders

It is an unfortunate truth that there are too many people who get promoted to positions of leadership when they have no business being there.  Leadership is effected through competence, vision, and focus.  Within all that is the ability to manage expectations, to raise people, and to be concerned for all stakeholders.  A great leader represents a collective, not the individual. 

In our current era, there is a lot of talk about consultative leadership, servant leadership, and the committee.  It creates conditions where people are promoted to positions of leadership because they appear to be leaders, not because they are capable.  Since most people are influenced by the flamboyant and the loud, they imagine that the qualities they are looking for is attitude, confidence, and charisma.  What we have are talkers, not doers.  Leadership assessments themselves promote this bias, and this problem perpetuates itself through flawed mentorship.  When the leader is unfit, every decision is a wrong decision. 

The most dangerous of these bad leaders, and the ones who are dedicated enough to make it to the top, is the leader who is only concerned with his self-interest.  Because it is in his self-interest to succeed in the here and now, it sometimes seems that he is good for the organisation.  One of the things such leaders do is look out for potential rivals.  They will strip organisations of talent because talent is a threat to their power.  They promote sycophants, which ensures a cycle of mediocrity which will drag the organisation down long after they are gone. 

Sir David Frederick Attenborough  said, “No one will protect what they do not care about, and no one will care about what they have never experienced.”  These leaders have never experienced the strength of the collective.  They are the death of organisations in the long term, while possibly delivering growth in the short term.  Short term growth is commensurate with their remuneration.  Long term growth is not their problem. 

Another characteristic of a bad leader is narcissism.  Narcissistic leaders promote a toxic environment, since they have no empathy.  This results in high personnel turnover, and loss of institutional knowledge.  The best and brightest in an organisation have options, and they will be the first to leave.  A worst case scenario is that toxic behaviour actually opens the organisation to legal action.  A narcissist does not share the limelight, and will belittle others.  Gibran Khalil Gibran said, “To belittle, you have to be little.”  Big organisations, with big goals, cannot be lead by little men of little ability. 

Some terrible leaders are competent in every other area, except that they do not recognise the value of people.  Employees and volunteers are stakeholders.  They are neither an expense, nor are they numbers on a list.  There is a reason why it is called “human resource”, because good, trained, experienced people are a resource, an asset.  Oliver Napoleon Hill said, “It is literally true that you can succeed best and quickest by helping others to succeed.”  When our success is the success of the people around us, they become stakeholders in our growth, and we in theirs. 

One of the worst forms of leadership is the perennial micro-manager.  Because there is no delegation, all decisions are stuck with this person.  The organisation is held hostage to his every indecision.  Marcus Tullius Cicero said, “More is lost in indecision than wrong decision. Indecision is the thief of opportunity.  It will steal you blind.” 

Micro-managers do not trust their people, or the system.  Because there is this trust deficit, information is at a premium, and the management style is autocratic.  There is no room for discussion, and no place for independent input.  This creates a culture of ossification, where creativity is limited, and innovation is anathema.  Stephen Richards Covey succinctly said, “Failing organisations are usually over-managed and under led.”  When the focus is only on the self, the eye is not on the horizon, and such organisations tend to lurch from crisis to crisis, all the while falling further behind the curve. 

A good leader understands that he is only a facilitator of the success of the collective.  A great leader understands that he leads by not leading, meaning that he creates the system, nurtures leadership at every level, and allows them the space to grow.  Leaders are only meant to step in when the team needs vision, and then clarification is required at specific junctures.  They are only visible when there is an overt need, such as a crisis. 

Stephen Richards Covey said, “Effective leaders are not problem-minded; they are opportunity minded.  They feed opportunities and starve problems.”

Compliments & Gratitude: The Positive Organisational Culture Few Bother to Build

One of the top priorities of any organisation is establishing a positive organisational culture, one where different stakeholders support each other because they recognise themselves as part of something greater.  People need to feel recognised, enfranchised, and celebrated.  That recognition buys commitment and loyalty.

Why the Brain Treats Praise Like Money

One of the simplest ways to reinforce this culture is inculcating the habit of praise and gratitude for good work, delivered sincerely enough to raise morale.  Positive feedback mitigates stress and pressure, improving team performance.  Neuroscience confirms this is not sentiment.  MRI studies show that receiving positive feedback activates the ventral striatum, the brain’s reward centre, in much the same way a financial reward does, releasing dopamine that reinforces the behaviour that earned it in the first place.  Gallup’s own Q12 employee engagement survey found fewer than one in three American workers can strongly agree they received any praise from a supervisor in the past week, and employees who feel unrecognised are twice as likely to leave within a year.  The positive effect of praise is not merely underestimated.  Most organisations are actively starving their own workforce of a reward mechanism their own brains are already wired to respond to.

The Barrier is Not Praise; It is the Giver’s Anxiety

Psychologists have identified a critical barrier standing between organisations and this positive culture: a mistaken expectation of how effective praise actually is.  People doubt themselves and grow self-conscious when giving compliments, an unsupported anxiety that leaves them pessimistic about the effect of their own words, a kind of impostor syndrome applied to gratitude rather than achievement.  This is the barrier leadership must overcome first, by setting the example itself rather than waiting for the habit to appear on its own.

Why the Habit Rarely Takes Hold on Its Own

Even after giving a compliment, people frequently fail to grasp its actual effect on the recipient, and without seeing that effect, they never adjust their own behaviour to repeat it.  This is best addressed through group activities that build rapport and culture, and through mentors who instill the habit by example rather than instruction.  The focus should sit on the emotional sincerity behind the words, not the craft of constructing the perfect compliment.  Herbert David Kelleher, co-founder and long-serving CEO of Southwest Airlines, built much of the airline’s famously loyal workforce on this principle, personally writing thousands of handwritten notes and birthday cards to employees over his tenure, a habit small enough to sound trivial and large enough to define an entire corporate culture around genuine recognition.  For any version of this to work, it must be seen as genuine.  Compliments and gratitude should be the norm in everyday communication, not the exception, and the habit does not lose its value the moment it stops being rare.  It gains value because a culture where recognition is constant is a culture where nobody has to wonder whether their work was noticed at all.

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Terence Nunis | Executive Chairman, Equinox Zenith | Author, The 1% Playbook: The Billionaire Cheat Code

Addressing Forms of Team Demotivation

“Motivation” is a noun.  The plural noun is “motivations”.  Motivation is a reason or reasons for acting or behaving in a particular way, or a desire or willingness to do something; or the state of enthusiasm.  In a business or organisational context, motivation is the enthusiasm to get the job done, by starting rather than procrastinating, by persisting in the teeth of challenges.  Motivation is the driver of organisational and business growth.  As such, loss of motivation, or motivational failure, in human resource jargon, can be fatal. 

To address loss of motivation, we need to consider the reasons for that loss.  According to research, these reasons fall into four categories, what the researchers have labelled motivation traps.  They are a mismatch of values mismatch, a lack of self-efficacy, disruptive emotions, attribution errors.  It is important we understand the nature of failure in order to address it. 

The first, and perhaps, the most common is the mismatch of values.  People are moved by self-interest.  There has to be something in it for them, and it should be worth the effort.  When the employee, the volunteer, the person in question, feels a disconnect with the task, or if they are sceptical of its value, they experience and erosion of motivation. 

This is easily addressed.  The work distributed must be explained within the context of the whole so that they understand that their contribution is crucial.  People want to feel valued.  If there is interest value, where there is a compelling intellectual connection, people will be motivated.  It appeals to their self-esteem and their ego, because now, there is a sense of self-worth and value to their contribution.  Related to this is the sense of identity.  People identify with their occupations when there is a sense of esteem or prestige associated with it.  This is why companies spend money and effort to give titles to even the most mundane position.  A better way would be to draw out the specific capabilities of the person, and how that is related to the task or job at hand. 

This also points out to the importance of the task.  One of the quirks of organisations and teams is that we sometimes overlook how crucial specific tasks or jobs are simply because we do not realise their worth.  Too many leaders assume the most important tasks have the highest profile.  In fact, a good administrator or coordinator, for example, is the foundation that holds everything together.  This must be highlighted.  It builds respect in the team, and raises the morale of the support team.  There is value in utility which must be reflected in importance.  Additionally, compensation must be commensurate to work and responsibilities.  This is the basic measure of importance. 

Secondly, motivation is tied to confidence.  When people believe they are not up to a specific task, they are demotivated.  This is where we work on building their confidence, having mentorship, and putting in place training before assigning a task.  This is because, people who lack competency in a task naturally assume that success at a particular task requires the investment of far more time and effort than they are willing to afford.  We need to convey to the that they have greater ability than they realise, provide mentorship, and bolster their confidence and esteem.  This is a major part of people management. 

On the other hand, we also have the situation where people are demotivated because they feel a task is beneath them, and they are over qualified.  The assignment of the task to them could be seen as an insult, and this creates tension.  People with an inflated sense of importance are one of the greatest human resource challenges, since they tend to challenge the system, and make mistakes.  These people cannot be mentored; they must first be disabused of these notions of overconfidence.  Otherwise, they take no responsibility for their mistakes.  Unless these people have some value to the team that makes it worth the effort to accommodate them, it is simply more expedient to discard them for the sake of team harmony.  Otherwise, it may be possible to reframe the importance of the task, and make them understand its worth. 

Another form of demotivation is caused by negative emotions.  This happens to the best of people.  Due to events such as divorce, a death in the family, or other concerns, they could be having anxiety, depression, anger, or grief.  This requires a different management tack: empathy.  Sometimes, people simply need time.  Other times, they need to be given space.  And when they have had time to process these emotions, we sit down with them and have a conversation.  The intent is to engage in active listening. 

Different types of emotions require a different method of response.  People who are consumed by anger are often overwhelmed with a sense of injustice.  This is addressed by getting them to focus on the perceived injustice or wrong and reframe it.  The next step is to consider legal and effective means of remedying that wrong.  This empowers them.  If it is depression, their sense of self-worth is affected.  It is not possible to point out that any sense of inadequacy is an illusion logically, since this is not about logic.  Rather, we address this by pointing them in a different direction, to focus on what they feel adequate at, and build them from there.  Anxiety and grief are relatively easier to address, and require a listening ear.  In any case, should these emotions be overwhelming, it makes sense to have them engage a professional. 

Finally, people get demotivated due to a misattribution of errors.  This means they either cannot identify where they went wrong in a task, or they misattribute it to causes that do not address the issue.  An inadequacy of time management is an attribution error, for example.  Constant tardiness, or missing deadlines is a common form of it.  This is addressed by helping them identify the cause, and working with them to rectify it.  The intent is to bring the cause of the error back into their control so they can take responsibility for it.  When people believe the cause of their problems are outside their control, they will not make any effort to address it, and this leads to a spiral of demotivation. 

Essentially, people need to be nurtured and built, since they are the foundation of a great team.  When properly motivated, that team can achieve wonders.  When mismanaged to demotivation, even the best people are unable to function.

Identifying & Building to Our Strengths

It is easy for us to identify our weaknesses, especially in discussions with our colleagues and management.  Our weaknesses are areas we are obviously deficient in, and we look to address them through training and development.  It is a lot more difficult to identify our strengths.  Our strengths tend to be in areas we are so proficient, we take it for granted, and fail to see the value in those skills.  The average person thinks, “If it is easy for me, it is easy for others, so I have no need to highlight it.” 

From a management perspective, we want our team to play to their strengths.  Management often mistake what people are competent at as their strengths.  They may not be the same set of skills.  Competency is built on experience, repetition, and the ability to learn.  Strengths are built on that, but have an underlying foundation of the individual attributes to enhance them.  For example, in an organisation I was involved in, we had a person who was excellent in event management.  She put together all the programmes, and did so competently.  Her real talent actually lay in corporate relations, and getting sponsorship.  Because she was tied up in event management, we missed out on her talent in corporate relations. 

Part of leadership involves managing the human resource element.  This is often mistaken as pure headcount and cost.  True human resource management is the ability to identify, develop, and deploy people where they are most useful and beneficial to the organisation.  It means having the discernment to spot talent, and not mere competency.  We begin by identifying the strengths of each member of the team. 

One of the stranger things about innate talent or ability is that we imagine that everybody should be like us, and wonder why they find things we have no trouble with, challenging.  As such, we look for things that people are secretly or overtly impatient with others, because they think they take too long to do it, or find it unnecessarily difficult.  This works the other way as well, since there are things some people find especially difficult to do.  This has nothing to do with intelligence.  We are all wired differently.  This also means, for some people, there are accolades and compliments they dismiss.  That which is too easy is not worth complimenting. 

The second thing we do is consider, in our interactions with these people, what are the subjects that occupy their thoughts when there is nothing else to think or talk about.  The areas people focus on are the areas of deepest interest, which implies the areas of greatest competency, their talent.  We are too quick to dismiss hobbies, interests, and past activities beyond a cursory classification of whether they are team players, have leadership potential, or other attributes that conveniently fit the boxes we have created when we recruit these people.  We need to consider, at a deeper level, how these very interests relate to tasks available within the company so we can best leverage on these talents.  These are not abilities that are typically listed on most curriculum vitae. 

In our interactions and discussions, we need to consider, at a deeper level, the fundamental question for every idea, every suggestion brought up, “What is in it for you?”  Consciously, or unconsciously, people want something for everything given.  If we can identify them, we can utilise it to motivate them better, while also leveraging on their talents and their self-interest. 

We then take these strengths, create a matrix, and educate the entire team about the strengths of each member.  This makes working to each other’s strengths a formal part of the team dynamic.  We build these teams from a select core, and then create a support team around them, as the business grows.  Every time there is turnover, we consider the strengths of the replacements, and adjust accordingly.

Fixing My Relationships

If only relationships were as easy to fix as the issues we address at board level.

Quora Answer: What Should I Do if an Employee is as Productive as He is Troublesome?

The following is my answer to a Quora question: “What should I do if an employee is as productive as he is troublesome?”

There is a contradiction here.  If he is troublesome, how is he productive?  He may, as an individual, be productive in terms of meeting production targets and fulfilling KPIs, but if he is toxic, he is affecting the productivity of those around him.  In such a case, he is not, in reality, productive, because overall productivity of the unit he is in is affected.

You have to define in what manner he is troublesome?  Is he simply aloof, or keeps to himself?  Does he segregate himself from the team?  This requires delicate man management.  Does he have deeper issues that need to be resolved?  This may require professional help.  Is he outright toxic, and a bully?  If that be the case, termination is best for the sake of team morale.  In the case of toxic behaviour, if it is not nipped in the bud, it evolves, and becomes workplace culture.  Once it is culture, it is extremely difficult to eradicate.