Reasons why companies fail
A couple of days ago I have seen a very interesting Ted talk on the reasons why companies fail. Knut Haanes underlines in it the two factors:
I started to dig in the papers of the actual reasons behind failures, ones that go beyond all the clichés. Harvard Business School did an interesting article on the subject, where the main reason is not having a balanced plan: companies focus too much either on technology or sales. There is also a luck factor: even if a Start Up gets good team and good financing, they face dozens of lower-cost competitors and fragmented customer demand. One of claims YCombinator proudly does is that even if your idea doesn't get funded, it shouldn't matter to you as an entrepreneur (your business still can be a successful one), since VCs are making mistakes all the time.
It is estimated that nine out of ten companies starting their business (start-ups) to bear defeat. Knowledge of the reasons for that show CEOs failing companies can provide information on what to do in order to achieve long-term success. The first most prominent reason for the collapse of the company is simply no market need. Businesses are generally optimistic. In the end, they started the company in the hopes of success. Unfortunately, even if there is a market fit for the product or service, another problem is the lack of cash to keep the company when things do not go as well as assumed. In addition, there may be unforeseeable and incalculable costs, which will result in much higher cash outflow than expected.
For me, the actual lessons with bases to avoid along with a set of good frameworks are keys to, maybe not avoid completely, but at least minimise risks of failure in an agile StartUp environment. There is a great list in Autopsy.io which everyone should visit once in a while to get an overview of what can happen and how to prevent that. Henry Ford said: "Failure is the opportunity to start from scratch - only more intelligently.", and if a founder is able to maintain high level of integrity even in difficult times, the failure can actually lead to many new opportunities.
I like to have an eye on what's going on out there, where to be, what to be inspired by and even where to invest (although currently out of the investment field). Lately I'm doing research on most profitable businesses to be in and trends which are worth tracking. Obviously, we can look at those from many different points of view: it's not the same to start on your own (than the lean approach would probably be the best one) than have some millions out there to spend on trying and retrying. Whichever of the options is the closes to what brought you here, these are the main StartUp trends:
Virtual reality: Whenever it is Oculus or Microsoft's HoloLens, VR is definitely finally going mainstream. And with a reason: more and more popularity, hungry for innovation users and technology that finally enables incredible 3D experiences.
Enterprise software: There a lot yet to be done in the field, but competition is huge. Since the top trend is to be people centred, there are new demands for collaboration and reachability. Companies want effectiveness and automation, employees want usability and low learning curve. Anything else to say? Sharing is caring.
Digital Health: Imagine not only having all your medical records in one place, but also to have systems and people all around the world helping you to get the best diagnose and connect to the best specialists and most effective medicine. Given its a reality and not a cheap sales pitch: How much would you pay for it? How much would pharmaceutical companies pay to be there and get the know how on how to build better products?
Online videos: whether you want to start small or have a huge budget to kick off, making videos is something that can bring you quite a revenue. Take into account that in Youtube you are competing with 100 videos uploaded per minute, but companies need variety of content in order to boost their SEO strategy and this is where your sales pitch may start. Add a bit of benchmarking and creativity and voilá.
Crowdfunding: social media are getting more traction day by day and we get easy access to the crowd. You can base the project on rewards (mostly pre sales of the product) or equity (shares). There is a lot going on when thinking on building a platform for crowdfunding and the role of reputation and trust is huge, which is why it is not an easy task considering the amount of existent ones. Yet, if you are interested, should definitely have a look at the following ones: Indiegogo, Kickstarter, RocketHub, SeedInvest, Crowdfunder, CrowdRise, Appbackr, Quirky and Invested.in.
Glassdoor, which is my absolute favourite site in terms of everything HR related, every year publishes the weirdest (they call it oddest) interview questions. Although there may be some discussion in terms on why the companies are looking for by asking them (from "see how quickly you can switch from one subject to another random one" where the thing is quick response to "see how you justify something nearly impossible to justify" where it is about finding strange arguments for even stranger points of view) I think all of us who did perform interviews in the past both as interviews and candidates will agree that this approach definitely makes us know the candidate (and the company) far better that the "standard" questions everyone usually ask. They show the way you think without you having to subjectively judge the subject. And they are absolutely brilliant.
I am going to publish all the list of weird interview questions in here, not only Glassdoor one from 2015, but also from previous years, along with Michael Page list, so you can all get prepared. Ready? Here it goes:
All of them have links to answers (directly in Glassdoor, and if you haven't signed up yet or even worse, if you don't know the site, I strongly recommend you do sign up and follow it), and I have a favourite one in all on them as well, which I do not publish on purpose, since it's all about you trying to respond them quickly yourselves before viewing the possible answer.
If you have not, than check them again and write an answer to every single one of them before the 2014 favourites come.
The Best Ones from 2013:
At the end, I want to share with you the "Expert´s opinion" on the 2015 ones, so you can see what HR specialists think that other HR specialists seek in the candidates when asking these kinds of questions. I will also add my favourite possible reply, since it is all subjective and is supposed to show the others how you really are (and yes, know you better, because if you are not selected, it means you were not meant for the job).
1. "What would you do if you were the one survivor in a plane crash?" --This question was asked of an Airbnb trust and safety investigator job candidate.
As with all the oddball questions, interviewees should relate their answers back to the workplace, Dobroski noted. In this case, a potential response could include how to ensure the survivor's safety, as well as checking the rest of the plane to make sure there were no other survivors. Asking about nearby resources, such as radio or cell phone towers, could also help show the interviewer that the applicant can think ahead and plan for emergencies.
My favourite answer: Be glad that I was flying solo that day.
2. "What's your favorite '90s jam?" -- A Squarespace customer care job candidate.
While this might seem goofy, Dobroski notes that this open-ended question is a way for a candidate to show off their positive qualities. "I could answer, 'All Star' by Smash Mouth. This reminds me to keep reaching for the stars,'" Dobroski said. "These can be very short responses, as long as you relate it back to the workplace."
My favourite answer: Virtual Insanity (or anything else, really, you can fill that one with whatever)
3. "If you woke up and had 2,000 unread emails and could only answer 300 of them, how would you choose which ones to answer?" -- Dropbox rotation program job candidate.
This is the type of situation that almost everyone deals with today, but it also allows the candidate to show how he or she would prioritize in a potentially stressful situation, Dobroski noted. Candidates could note that they'd search for names of people and subject line terms that would need attention first, for example.
My favourite answer: The automated pre-filtering I have setup should group the most important ones into key folders and then I just scan through the sender names and subject lines for the most critical ones first.
4. "Who would win in a fight between Spiderman and Batman?" -- Stanford University medical simulationist job candidate.
This is a circumstantial type of question where a candidate could ask the interviewer for more information, such as whether the fight is in a cave (giving Batman an edge) or the top of a building (Spiderman). "This shows how you assess an unexpected challenge," Dobroski noted. Giving a one-word answer such as "Spiderman" isn't what employers want to hear (no matter how much you love Spidey.)
My favourite answer: It already happened, and Spiderman won. Why else do you think Batman has to wear his underpants on the outside? That was the losing bet...
What one *can* extract from this question is an interesting Case Study of cross-IP ventures between the two extant leading comic book publishers: Marvel and DC. Here, there are much clearer metrics: generated grassroots excitement in the social networking spaces and in print, online, radio, and television media. Sales of print and digital copies of such a crossover. Critic reviews and user based reviews. Overall profit. The lasting legacy of exerting some form of influence on pop culture and future comic book artists and writers, as well as the corporate strategy of comic book companies themselves.
The Case Study itself will evolve depending on what question you deem most important is. Do you simply want to know whether cross-IP ventures are profitable or not? Do you want to measure marketing vs grassroots advertising effectiveness and reach in an effort to maximize the impact per dollar spent on advertising? Or do you want to tackle the more nebulous topic of the comic book battle's lasting legacy in pop culture and comic book fandom?
The questions you're interested in define the metrics you'd be most interested in gathering. You can then discuss *how* exactly to measure each metric, what your data sources are, the accuracy and quality or veracity of such data sources, the cost of data gathering, and so on.
Penultimately, such metrics would be next to pointless unless you also developed a model for cross-IP ventures. What are the variables associated with such a venture, and how would tweaking them affect the metrics outcomes? Perhaps you discover that anonymous seeding (or astroturfing) social networks has value as long as you don't exceed a certain threshhold and get caught, at which point it has a negative effect on your marketing campaign. Instead, you invest more in teasers and cleverly orchestrated and short vignettes, optimized for the chances to stimulate a viral response.
All this is, of course, relevant to Medical Simulation. The creativity, the will to embark on novel scientific inquiries, the discipline of defining metrics, the analytical skill behind developing a working model of the entire enterprise, and the determination to refine all these with further investigation.
Lastly, Batman of course. Strength of will and mental aptitude always trumps being able to shoot proteinaceous silk out your butt.
5. "If you had a machine that produced $100 dollars for life, what would you be willing to pay for it today?" -- Aksia research analyst job candidate.
Candidates could ask the interviewer for more information, such as whether there is only one of these machines available or if there's a glut. Asking about whether there is risk involved -- such as whether the owner could be targeted by criminals -- could also help show analytic skills, Dobroski noted.
My favourite answer: Considering that the question is asked wrong, first we need to know if it it 100 USD for life or per year for life. As soon as the interviewer gives us an answer, assuming it is per year, we need present value of a perpetuity with a $100 annual payment.
PMT= payment per period
r= discount rate
Given current US fed reserve discount rate is 0.75%, the Present value of such a device would be $13,333.33
Answer varies obviously if discount rate changes or if proper phrasing was meant to be $100 for a different time period.
6. "What did you have for breakfast?" -- Banana Republic sales associate job candidate.
This sounds like small talk, but it allows the interviewer to gauge whether the candidate is an upbeat person and can relate to other people. Sales associates are asked questions all day long by customers, and keeping upbeat energy is important.
My favourite answer: This job's requirements (watch out though, you can not answer that way if there is no good feeling between the interviewer and yourself AND if it is not true).
7. "Describe the color yellow to somebody who's blind." -- Spirit Airlines flight attendant job candidate.
This question tests a candidate's sensitivity and how they gather information. An applicant could ask whether the person is partially blind and when they became blind, helping to formulate an answer and deal with someone's disability. "There are times when they have to work with passengers with special needs," Dobroski noted.
My favourite answer: You can't. But if you had you, it is best to use other senses to describe it. Yellow is a bright colour that fills a person with happiness and joy. It is the colour that warms us up in summer, as it is the colour of sun. It is also the colour of sunflower and banana, so it smells like a shake in the summer. Yellow is laughter, joy, youth and happiness. It is a warm handshake or a friendly hug.
8. "If you were asked to unload a 747 full of jellybeans, what would you do?" -- Bose IT support manager job candidate.
Unloading a plane full of jellybeans is no small task, so this allows a candidate to show off their project management skills. An interviewee could ask what the budget is, when the deadline is for unloading the plane, and whether they have machinery or staff to work with. That will help demonstrate the candidate's ability to think through all the possible dimensions of the challenge.
My favourite answer: Assuming they are loose jelly beans, and their unloading needs to be managed rather than just dumped on the tarmac ... Start by phoning the people at the other end, of the process. They managed to load an entire plane with jellybeans! Any group that can figure out how to fill a plane with jelly beans may be a big help in undoing this mess.
9. "How many people flew out of Chicago last year?" -- Redbox software engineer II job candidate.
This question for an entry-level engineering job is, not surprisingly, geared toward assessing a candidate's analytic skills. The interviewee could walk through their thinking, such as how many flights go in and out of Chicago each day, how traffic surges at the holidays, and come up with an answer. The interviewer isn't interested in the correct answer, Dobroski noted. Rather, it's all about how a candidate handles such problems.
My favourite answer: There is 3 mln people living in chicago, but there is 12 mln in Illinois and some of them are going to be flying as well, if we take 10% plus all the ones that pass through the city we can get 15 planes/hr x 24 hr/day x 365 days/yr x 150 people/plane (avg) = 20 Millions aprox.
10. "What's your favorite Disney Princess?" -- Coldstone Creamery crew member job candidate.
This question is all about getting a candidate to show off their personality. Responses should link back to the business, Dobroski noted. "You might say, 'I like Cinderella. She epitomizes someone who works hard, is well liked and has overcome some challenges. That's how I approach work,'" he said.
My favourite answer: Why be a Princess when one can be a Queen? Besides, I prefer old-school Maleficent. She was decisive and stayed on point for 16 years.
1. Always start with yourself: in order to motivate others, you have to be motivated and be a part of the project, feel it and know it. Show energy, security, confidence and conviction.
2. Share the information you have about the project, the team must endorse the project and know the circumstances surrounding it and its limitations, this can also lead the team to take initiatives to make suggestions on ways to improve the project. I know, this is not an easy one, especially if you are a part of a large organization, but you can surely find a way to share, at least, some part of that.
3. When you are facing a problem related to the project, the team is your greatest asset. Take the opportunity to encourage people to share problems with the rest of the team. That encourages the participation for ideas and alternative ways out.
4. Discipline is important, but you must try to maintain a friendly environment. People usually work best if they feel pressure and no control. The dates and commitments should be challenging, so the team is proud of achieving them.
5. The projects are divided into phases, a good project manager motivates his team to point out the milestones of the project, usually you can prepare a special celebration to reach milestones on time. Ice cream on successful end of Sprint? Why not?
6. Always show appreciation for the members of his team, even small tasks must be completed with at least a thank you, people can do more to seek such recognition. When contacting be humble, choose your words carefully.
7. During the evaluation the principle is not trying to blame anyone, as this can create an atmosphere of distrust. For a good atmosphere should understand that it is an achievement of equipment or equipment failure.
8. Give positive feedback. Be part of the team when you have to take responsibility for a failure and end feedback always on a positive note.
9. Go to lunch with a team member, talk about trivial topics including some work related and enjoy the time together. Work on a relationship, this can bring new ideas to business and your employee will know that he/she is valued.
10. Listen to your employees (actually, do listen - you learn nothing new when speaking and can always learn while listening).
11. Consider rolling up your sleeves to help carry out the solution on a problem from time to time. This is earning respect by actions and not words.
12. Always support your team, give them confidence and give them opportunity to earn your trust. It is imperative to trust that lean on if they are in trouble (I will be writing on trust way more in here).
13. Not everyone can carry out all work. As a leader it is up to you to choose the right person for the right job. Although a member unconvinced face a new task could gain a lot of confidence to successfully complete the objective. The impact is huge morale in case of failure.
14. Eating together is a relationship builder, have meals together when someone present a topic related to the job.
15. Allow team creativity, increase team productivity if given a day where they can try new ideas, provided they have something to do with the project at hand.
16. Consider fun, maybe some free time in a board game or something similar, do junior teams members against veterans and let you enjoy competition or perhaps work parties.
17. When ideas and feedback are requested usually the more timid members tend to be left behind. Give these people the opportunity to come forward and speak, you should listen carefully and evaluate ideas on their merits. Be sure not to discourage participation quickly qualifying as a bad idea, this could mean which not more.
18. There are members of your team that show great enthusiasm and encourage other members to do the same without saying. Identify them and put an effort on their professional development.
19. In brainstorming sessions, show your employees that their ideas are taken into account. Being taken into account goes hand in hand with the acquisition of responsibilities and assign roles according to their aptitudes and interests.
20. Divide the project into parts, so you can give your employees achievable goals. This will give them freedom to do things their way, leaving them gain confidence and so do their best work.
So we had this great operations management class and I decided to share with you the learning process or something that seems utterly boring (sorry, seems so) and changing it into something... well, maybe not entirely fascinating, but at least useful in business.
What is operations management?
Operations help build effective environments. It is one of the keys to building effective environments that is part of the business strategy. In the IT sector operations management consists in maintaining the status quo of processes, improvements and rapid implementation to address any failures that may occur.
As they are versus as they should be
Operations currently focus on problem solving. The current complexity of the processes must be replaced by mainstreaming, cause operations are not a black box and are an important part of the strategy. In the approach to operational efficiency it is important to optimize resources, which, from the organizational approach, are production operations, logistics, purchasing, procurement, distribution, customer services etc. From the point of sale and management it is about increasing revenue through proper management of operations.
The approaches to the scope and objectives of the operations: famous trade offs
The trade offs are called sources of complexity.
When taking the operations management approach, we divide them into:
Operating Hardware and Software
Functional decisions have a specific type. While active policy we call the operating hardware, the management system is referred to as operating software. Although companies often overstate the "hard" to "soft", which is a priority and more important decisions are soft, as they focus on more difficult intangibles of being copied and therefore are part of the competitive advantage, and developing skills. However, they should always be accompanied with the right choice of hard, in line with corporate strategy, and be analyzed as a whole.
Tools for operational excellence
Types of effective leadership
To be a good leader, the manager must be versatile and adaptive, able to change roles according to the needs of your team. Furthermore, it should be transformative, focused on the market and with an attitude of constant improvement. An inclusive vision is needed to encompass all the projects to which it is faced. Should be able to ask and answer questions and delegate, not only tasks, but also the leadership itself when it senses that another person will be more efficient for a particular task.
The issue of delegation of leadership is especially important because it is often the key determinant of success in managing the team. How to delegate effectively and, at the same time not lose the status of the management role? The question of ego and fears are often the main problem in the management of teams, which is why the confidence and transparency in the company are so important.
Operations there are three types of leadership:
Each is used according to the needs of the enterprise. A leader must also be combined with the integrated vision consistent with the personality, character of the organization, culture and values and a good ability to influence on both, individual and collective side of the team.
Dilemma of the two companies
When comparing two different companies, which is better level of operations it will always be the one with a higher rate of rotation. When there is more rotation of products, it is more competitive, since it has more flexible responsiveness and less accumulation. The inventory is often a bottleneck for the company, so planning is as important - if not planned, supply and demand are not related, as the flexible response mechanisms are more expensive than the client is able to pay. And then whoops, a problem for the company.
Operational excellence as a business challenge
In managing the business operations there are several challenges. Flexible response is the first one. In the traditional world, it complies with intelligent management, value chain and managing expectations through promotions (do not forget that in this case the highest quality is closely linked with a higher cost, so the question of what accounts for the highest cost, in this respect, is crucial).
Operations management is a set of effective management: HR, of sets of activities, hard and soft decisions, operational excellence tools and trade offs. The efficiency lies in the continuous management via costs and income variables via differentiation, service, flexibility, competition variables through the strategy and market analysis.
To avoid mistakes, instead of looking at the operating costs, we must look at the costs of the market. Operations market always built back and not vice versa.
To all the questions we may have, the answeres shall be segmented according to the client's needs. If there is no strategy then be complex adaptive mechanisms used to answer customer needs. Decisions on revenues and costs are not taken only from the standpoint of operations, but have an impact on the operational outcome. When interdepartmental trade offs occur, the product margin expands, the cost and product life cycles shorten. These are precisely the interdepartmental trade offs and managed through the multi-departmental management processes and mainstreaming.
Adapting to market
As you change the market, it has to tune the operating model. If market changes, operations strategy must also change. The output in this aspect moved on product attributes, those that respond to a value proposition and competitive analysis. The market changes because the competition varies. The context may be turbulent. Variability has two causes: exogenous, which can not be controlled, and internal, which come within the company, such as promotion policies, the changes in product life cycle, etc. It is important to remember that when there is a clear focus, tactical decisions and operational focus on a short-term may destroy the long-term strategy.
Efficiency→ Target → Optimize Efficiency Resources
Competition → Target → Profitability Analysis
Supply Chain Management → Target → the value chain (as closer to the customer, more control the company has). Corporate strategy must position the company within the chain - if the corporate strategy is not right, then not be able to achieve the objectives of improving effectiveness and efficiency
Business Model → Target → Development of competition in the case of malfunction and when other companies have managed to remove net interest income and have moved to product, the problem is that the business model has become obsolete. The brand has a huge capacity and long tail can sometimes endure for a while, but the change is needed in order to survive these conditions.
All companies have operations departments, the output is different, but have managed to develop a range of skills / abilities. A competency is the ability to do something that others are not able to do. Competition can be achieved through changes in management and processes: operations is an internal procedure.
Thus, the company, in the first step, you should choose the basic skills, which are classified according to the results expected of them:
The skills that facilitate anticipation of market needs
1) Connection - learn to improve service, as each decision made other decisions reached
2) Time of strong development of competition - be able to serve the market quickly so that this business model can be made replicable - once the model can be replicated learn.
The correct troubleshooting process is essential. The complication arises when a company chooses a tactical response and this one is incompatible with the overall strategy. To avoid this, you need to be coherent and consistent.
All these issues need to be viewed from a multidisciplinary perspective.
In the next stage a series of processes shall be designed, projects or cross-cutting initiatives that eventually will result in in skills, then the distribution of power, which is what is giving resources is designed. The same building initiatives, the way the things are done must be consistent with the character of the organization and people who represent it.
In managing change should not touch the organization but to develop initiatives and assemble teams with a good management, to prepare the organization to develop initiatives. The message is to create work systems with a condition and communication protocols - R&D is responsible for managing the troops, marketing, finance, design is being performed to implement a bottom up structure.
Then they would have to go into the subject of prioritization of the indicators - priority is to make decisions back and forth - the value preposition from the point of view of the product. Which is the primary one? Which are the secondary ones? A good KPI stucture is not very, but extremely important.
Knowledge for the future
One of the most interesting questions we can ask is the application of acquired knowledge to sectors that have more potential for growth in the future. The issue of knowledge platforms and digital manufacturing seem more relevant. Learning platforms as Udacity, Coursera, Udemy or Edx already provide millions of people access to quality learning completely free, which will make the universities will have to go adjusting its model to provide added value on courses As of expertise. As for Digital Manufacturing, networks of 3D printers Do you really have to wait 10 years to get to the implementation of this innovation?
It has already arrived.