On the other hand, take Uber. The founders started with a customer problemâa problem they experienced in their daily livesâthen applied technology. The problem was simple: finding a cab in Paris was next to impossible and hiring private drivers was expensive and took forever⌠That combination of a real problem, the right timing, and innovative technology allowed Uber to shift the paradigmâto create something that traditional cab
companies couldnât even dream of, never mind compete with.
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The choice is not between hands-on or hands-off. In our research, the entrepreneurs who led their companies from start-ups into some of the greatest corporations in history generally had both a hands-on style and an empowering style. No matter how big their companies became, they remained closely connected to their people, hyper-aware of facts on the ground, and directly engaged in strategic imperatives. If you lose your voracious curiosity about tactical details, if you lose passionate interest in people and how they are feeling, if you insulate yourself in the protective cocoon of executive comforts, you may well wake up one day to discover your company has already entered a doom loop of decline and self-destruction.
Iâve seen way too many people come out of the corporate world, decide to start a company, and be completely unprepared for what it takes. If theyâve never been on a small team starting from scratch, theyâre often a fish out of water. They spend too much money too fast. Hire too many people. Donât put in the time, donât have the startup mentality, canât make hard decisions, are buried by consensus thinking. They end up making mediocre products or
nothing at all.
Donât let that be your story. If you want to start a company, if you want to start anything, to create something new, then you need to be ready to push for greatness. And greatness doesnât come from nothing. You have to prepare. You have to know where youâre headed and remember where you came from. You have to make hard decisions and be the mission-driven âasshole.â [See also: Chapter 2.3: Assholes: Mission-driven âassholes.â]
So do the work. Know what youâre getting into. Trust your gut.
And when the time comes, youâll be ready.
You have to understand your customerâs needs and all the different ways you can address
them. You have to look at a problem from all angles. You have to get a little creative. And you have to notice the problem in the first place.
That last point doesnât sound like a big deal. But itâs huge. Itâs the difference between a startup employee and its founder.
Most people are so habituated to the problems in their home lives or work that they no longer realize theyâre problems. They simply go about their day, get into bed, close their eyes, realize they left the lights on in the kitchen, groan and grump down the stairs, without ever thinking: Why is there no light switch in my bedroom that turns off all the lights in the house?
You canât solve interesting problems if you donât notice theyâre there.
First, spot the similarities. Over time, the strategies of incumbents tend to converge. A useful exercise is to overlay the business models of companies in the same industry and then look for areas of overlap. Wherever you see competitors doing the same thing, ask yourself, âWhatâs the shared assumption behind this policy or practice?â and then, âWhat would happen if we challenged that belief?â For centuries, innkeepers assumed you had to own rooms to offer guests a bed for the night. Airbnb inverted this belief and now has more than six million listings across the world.
Second, focus on what hasnât changed. What aspects of your strategy have remained stagnant for years or decades? Over time, legacy practices, like wallpaper, become invisible. Your job is to question whether those 12 13 taken-for-granted practices still make sense. For example, though it endured a lot of pushback from traditional carmakers, Tesla challenged the long-held practice of selling cars through independent dealers. The companyâs sleek stores, often located in luxury shopping venues, offer customers a hassle-free buying process. Tesla understands that the best orthodoxies to challenge are those that degrade the customer experience.
Third, go to extremes. Pick some parameter of performanceâprice, choice, availability, speedâand ask what would happen if we aimed for a 10X improvement? Fifty years ago, a retired physician, Dr. Govindappa Venkataswamy, launched an epic quest to eradicate unnecessary blindness in India. Millions of his compatriots had cataracts but couldnât afford corrective surgery. How, Dr. V. wondered, could he reduce the cost of surgery by 90 percent or more? For inspiration, he looked at the fast-food industry. âIf McDonaldâs can sell millions of burgers,â he thought, âwhy canât [we] sell millions of sight-restoring operations?â Today, Dr. V.âs network of specialty hospitals, the Aravind Eye Care System, performs half a million cataract surgeries annually.
As individual teams kept racing ahead, Uberâs overall âorganizational velocityâ kept getting slower. There were three signs that the company was stalling. First, engineers were spending more time âwrestling with fixing things or dealing with mundane maintenance issuesâ and less time writing new code. Second, more teams had trouble implementing new features because they needed help from other teams, but werenât getting it. Or were blocked by other teams that were opposed to the new feature. Third, software outages were on the upswing. âEngineers and developers were responsible for their own code and on call for their services. That meant one proxy for technical debt was sleep debt.â The sleep debt kept getting worse. Skilled engineers âmiredâ in such âgrunt workâ kept leaving for companies such as Google, because they didnât like being âwoken up in the middle of the night fifteen times a week.â As Thuan explained, this âtechnical debtâ resulted from a structure that was too decentralized and norms that encouraged people to charge ahead without collaborating and coordinating with other teamsâso more and more employees engaged in firefighting to make temporary and local repairs that kept the system running but didnât fix root causes. Thuan added that further organizational debt was created because, as the company raced to scale fast, it hired and promoted too many inexperienced managers. These inexperienced managers were too focused on racing ahead and achieving short-term wins and were not focused (or skilled) enough to understand when to slow down and do things right and to coordinate their work with other teams.