Focus

“Life is better savored and work is better with focus”

Experiences over stuff in life.

A lack of focus wastes time, resources, muddies your marketing message, and causes confusion among the team. 

Pizza by the pound

I love local businesses. I'll try to support them whenever I can. Not because they grow things locally and they don't haul peppers from Chili. But because I can relate to the underdog. The guy trying to sell against big box stores and chains with marketing and advertising budgets bigger than their life time income. I'm intrigued by the business models they employ. How they can be unique in a world of so many choices.

Today I got my second recommendation to try a new local pizza shop in town called "Nola's Joint". They serve gourmet pizza rumored to be the best tasting pizza around, maybe anywhere. In fact my friend said "At this point I'm so addicted to the stuff that I don't really care how long the line is"

Quality by itself might be enough to make them succeed, especially against the giant chains cranking out eatable disks of bread and cheese by the millions. However Nola (assuming that's the owner) chose to sell her prized pizza by the pound.



The more I think about it the more I think buying pizza by the pound is the dumbest idea ever. Another friend relayed his experience of waiting in a long slow moving line as each person tried to figure out how to get what they wanted. This sounds like a lose/lose situation since all the customer knows is they want 2 slices of pizza and a coke and has no clue how much it might weigh or how much it will cost. Additionally, the restaurant is bound to be left with odd shaped small scraps they can't sell. It must take awhile for workers to know how to cut exactly 1 lb of pizza based on each variety of toppings. Who exactly is this business model helping?

Everyone I know is OK with a pizza being cut into 8 equal pieces. If Nola wanted to give customers more control, then she could sell 1/2 slices. I don't know of any place selling half slices but it might be nice to get a slice and a half some days.

This is like buying a car by volume - "I'll take one blue car with 16.3 cu. feet of space inside please"

How many pounds of pizza do you normally eat?

No guts, no glory

I saw Avatar this weekend and in typical good story form, the character had to overcome impossible odds to achieve a goal that was bigger than himself. Donald Miller would say this is also what makes a good and meaningful life. It takes guts to face impossible odds. There are risks and you may be ridiculed for your resolve and belief, but when you stand firm and see it through the rewards can be great.

I wonder if this is also what makes an interesting and impactful company. Apple, for example, has the guts to stand by their vision, their "higher calling". They don't follow, they lead. They don't worry about comparing themselves to anyone else, they have a vision of how things should be and they push to make it happen no matter what "they" think.

Apple just released the iPad, which no one asked for and which falls short of other products in so many ways. It plays movies yet does not support 1080 resolution, it is not pocketable, memory is not expandable, it has no camera so no video chat, no flash support, you can't replace the battery or anything for that matter, there is no stylus so it's not an artist's pad, it can only run one application at a time. Yet it's simple, relatively cheap, fast, and can run for 10 hours untethered. Apple knew what they wanted. They avoided the mistake of trying to make everyone happy. They did not try to play catch-up with other slate products or even netbooks. They defined their own market, targeted their own audience, and went for it. There is no guarantee it will succeed but taking a risk is the only way to make a real difference.

It takes guts to stand up and be different. It takes guts to stick to your vision even when others don't believe. There are more risks doing things this way, but there are also much richer rewards.

Some companies try to keep up with the crowd, others know where they want to go and blaze their own trail.

Which company would you rather work for?

Which life would you rather live?

Do hard things

I have noticed a disturbing trend in people working hard to find the easiest way to get a job done. My problem is not with a desire for efficiency, it's with pushing to make a marginal solution. The question becomes "What is the bare minimum I could do and still get credit for doing something?" or "What is the smallest feature set we can give the client to get them off our backs?". Instead the question needs to be "How can we knock their socks off and still deliver on time?"

In reality, if we are not striving to do the best and taking opportunity to surprise clients by going beyond what they expected, we are just plodding along punching a clock and collecting a paycheck. Not very inspiring. What excites people is knowing they are building something great, something that matters. The only way to do that is by doing something hard.

One of our engineers spent much of last weekend solving a hard problem. We had decided we could compromise the solution to get it done in time and it would still work OK for most people. None of us were proud of that choice, but what else could we do? By spending his own time, this engineer was able to solve the hard problem and deliver a feature that we can be proud of.

What are you most proud of? I'll bet it is the things that you worked hard to accomplish. If you find yourself trying to figure out how to get out of doing something hard, you may still get a paycheck but you are robbing yourself of the greatest prize - knowing you accomplished something that matters. Don't shy away from the challenges. Hit them head on.

Do hard things.

Chair economy

How can anyone justify buying a $750 chair when you can get one for $100? Style and prestige may play into it but neither are a reason your accountant will approve so let's look at the return on investment. The $100 chair will likely last for 2-3 years before it's worn out or broken. The $750 chair comes with a 12 year warranty and will likely last 15 years or more. As a result, the cheap chair costs $33-50 per year and the top of the line chair costs about $50 per year. Is it worth a couple extra dollars a year to sit on the best?

To a software developer, a chair is the 2nd most important tool for their job. The most important, a computer (with software) will cost a company at least $500/year, ten times the cost of the chair. Put another way, the best chair will only cost 3 cents an hour. All of a sudden it sounds like a deal.

The numbers show a great chair is not much more expensive, in the long run, then a cheap chair but what are the benefits for the company buying expensive chairs?

1) Improved Morale - Having a nice work environment makes everyone feel better about their job
2) Better Health - An ergonomic chair can make all the difference for anyone with back problems
3) Less hassle - A cheap chair will need to be replaced 5 times for each top quality chair
4) Recruitment Edge - A great work environment will help attract the cream of the crop
5) Increased Productivity - In a "scientific study" Steelcase found a top quality chair will improve productivity by 17.8% due to more focus and less fidgeting. Even if you only see a 10% improvement the chair would pay for itself in no time.

Now you can go back through my chair reviews and pick out the one that's just right for you.

How successful is your business?

When considering if a software business is successful, I start with revenue per employee. Revenue per employee tells you the capacity of the company and shows how much "headroom" they have to motivate employees, grow the business, or innovate the product.
Tracking profit per employee might seem to make more sense, however, profit is only what's left over after expenses and I want to know how much the company can spend on expenses.

If a company makes $10M per year and has 100 employees its revenue per employee is $100k. That may seem pretty good until you realize that there is overhead to keeping the business going - operating costs, employee benefits, cost of goods, etc. With only 100 employees perhaps your overhead rate is only 50% of the labor cost. This means $33k of the $100k is overhead, leaving $67k as the average salary.

That's a pretty sustainable business in the software world, but doesn't allow much room to get creative. You may not be able to hire the best, or kick off a new product development effort, or buy lunch for everyone every day in order to build a tight team.

A better goal for a software company is $200k/employee. With revenue approaching $200k per employee there are many more options open to you. Lunch everyday is a no brainer. Hiring the best is within reach. There is room to try something new and fail. You also have the ability to build up cash reserves in case the economy or your market takes a bad turn.

Minitab, maker of statisics software, brings in $196k per employee and as a result has built a 35 person movie theater, real putting green, gym, and pool for employees to enjoy. They have a top notch facility and have been rated one of the best places to work. They can hire for specialized positions like build engineer and installation tester. With those resources, quality can dramatically improve, driving a great reputation and customer loyalty, all of which feeds back into revenue.

Overhead expenses can vary widely between industries, so comparisons should be within a particular industry. As companies grow their overhead per employee tends to go up and so their revenue per employee must be higher. This provides an advantage to a smaller company that can sell at a lower cost than "the big boys" and still pay it's employees well.

I stumbled across an interesting statistic today on Hoovers: "The packaged software industry is capital-intensive and highly automated, with average annual revenue per worker surpassing $400,000. The custom programming industry is labor-intensive: with average annual revenue per worker of about $115,000."

Give me a product company over a services company any day.

What's your revenue per employee?

Review: Exercise Ball

Exercise Ball

Price: $25 (street)

Pros: Cheap, unique, versatile, promotes movement, available in several colors

Cons: No back support, does not encourage proper posture, can burst with proper application of scissors

Notes: I used the ball for several days and initially it loosens up the back, but I found if I used it for more than an hour or 2 my back hurt later in the day. Exercise may be its best use. Several people at work use them as chairs, one popped (ouch) and another lady fell off hers today.