NOTE: In Part One of our interview with Jim Twining, former Managing Member and CEO of Southern Tide, we got into the spectrum of entrepreneurial personality traits, self-awareness, and modifying behavior. You can learn more about Twining in Part One. Here we go with Part Two:
Regardless of personality type, there are environmental conditions to consider when taking the entrepreneurial plunge, conditions that are starkly different from a corporate setting. In comparing the differences between working for a large company versus founding a company, Jim Twining believes that “the biggest differences are a lack of certainty or less certainty; lack of infrastructure; the lack of having a team of great people. I think the biggest change is just the overall lack of boundaries. There are built-in boundaries in a big company, but when you’re starting something from scratch there are few.” The lack of boundaries can affect everything from the business plan to the people you select to get involved in the business.
By way of a business operations example, he talked marketing, specifically, the 4 P’s. “In an established company you have any number of products with established pricing; you have a price position within the market; you have established distribution; you know how you’re selling a product. Promotion might be the most fluid of the 4 P’s in bigger companies as technology and the market change. Whereas in a start up you have to think about where you want to fit pricewise; where do you want to fit product wise; where do we want to fit distribution wise. Are you going to be Ecommerce only, a mixture, BTB, and so forth; are you going to open stores or offices in different markets; there’s a wide, wide range of options. So you have to create boundaries where none exist.
“When you start off, you have all these decisions to make. It seems like they’re endless sometimes. And you have to be prepared because of that. You have to be organized; at least organized enough not to miss important things along the way, and to insure that you do what you say you are going to do. Perhaps one of the unfortunate things we see in small businesses that results in them being destined to always be small, is not to meet expectations, expectations that they control. And then, not to acknowledge it. There are way too many alternatives out there for people to keep doing business with someone who’s unorganized. That doesn’t mean you have to be overly obsessive, but you want to be organized enough to make sure you cover all of those bases.
“Other boundaries might be people boundaries. In an established company you have a structure in place, where different roles have different responsibilities, and people are focused on an area that they have talent in. Whereas in an early stage company you and others wear many hats. You can’t afford a large team, so you have to be very versatile or certain aspects of the business suffer.”
The Fatigue Factor
Lack of boundaries. Endless decisions. Many hats. Long hours. It can all contribute to exhaustion, a situation in which entrepreneurs often find themselves – and gives Twining pause as he finds fatigue to be one of the biggest challenges for entrepreneurs. “I’m not the first person to have identified this,” he said, “but if you get too fatigued you are subject to making poor decisions. When you’re starting a new venture, especially the way people bootstrap companies today; and you’re trying to just get it off the ground; you’re scraping by, trying to get capital from a few places; and you’re having to live hand to mouth; there aren’t enough hands on deck; and if there is success, you start growing, and you realize, ‘Oh my god I need more people but I can’t afford them right now’; what can happen is fatigue can set in. It’s one of the biggest challenges for early-stage founders, wearing a lot of hats and figuring things out. They’ve got to develop a routine that gives them six or eight hours of sleep every night. And I know a bunch of them who don’t sleep that much.”
Fatigue can trigger anxiety and depression, as well as other underlying mental health issues. This brought us to another recurring theme: If entrepreneurs know they should sleep more, eat better, exercise, do yoga, whatever, why don’t they? We asked Twining if there’s anything he as a mentor can tell them that’s an ironclad argument for personal wellness? He laughed. We took that as a no. “As a mentor, you might talk to a guy once a week or a few times a month, there’s nothing you can say that’s going to change his behavior,” he said. “Not that I’ve ever heard of. If there were we’d all know about it, I guess. There are no magic words – just encourage, remind and hope!”
As for dealing with someone suffering from fatigue, Twining did add, “Let’s say you’re a partner of a person like that, where you’re actively involved in the business, and you’re there everyday, then one of the things you can do is try to keep that person’s plate from getting too full.” He suggested putting in some kind of process to keep tabs on everyone’s well-being, but there’s no easy answer. “There’s so much pressure, fatigue can set in; and there is fear of failure, there is stress, a person does have to be careful not to burn out.”
Truth Goes a Long Way in Mediating Problems
Because we’ve encountered a number of founders who’ve had issues with their co-founders – misaligned visions and expectations, workload and responsibility imbalances, defined roles and equity distribution, etc. – we asked Twining if he’s had any experience with sitting two partners down in order for them to hash things out, to have a difficult conversation. And how do you start that kind of conversation? How do you break the ice?
“One of the things I’ve learned later in life is that speaking the truth is important,” he answered, “just being honest about something and how far that can go to get a conversation started. It doesn’t always work, but you can at least get them to have a dialogue about whatever the issue is, whether it’s an ongoing issue or a big individual type issue. You just have to sit down. You’re there in the role of mediator, and you say, ‘Guys, this is very important. It’s important because the business isn’t going to be successful unless you want it to be and want to resolve this.’ You just try to get them to open up about it. You just keep prodding them. If you have a few examples you can throw them out. Try to get the conversation started.
“Most of the times I’ve gone through this process, they at least end up resolving it for the short-term. It doesn’t always last. If someone is innately unorganized and kind of like the absent minded professor, they can change short-term and they can even change long-term, but it takes a tremendous amount of energy and constant reminders to affect change. If that’s the case, you probably have to set up some regular communication so you don’t let things escalate for six months and get out of control again.” If you don’t have a regular planned interval to discuss a potentially contentious topic, Twining believes any positive change is probably not going to last. In terms of communication, generally speaking, there needs to be a rhythm established so it can become part of the process of running the business.
Potential Conflicts Involving Family Dynamics and Partner Status
Twining made it a point to raise two other areas of potential conflict founders need to consider: family dynamics and partner status. “I think another big thing for entrepreneurs is, generally speaking because there’re always exceptions, in a smaller company a person’s family can become an influencer,” he explained. “I mean in the day-to-day. If you’re a small company they might drop by. They might talk to employees. So in a small company there are family dynamics that have to be considered for the entrepreneur or anybody they are partners with. It can lead to complications; it can lead to some unusual situations. Sometimes family members get involved in stuff they just have no business getting involved in. There are some of these situations where you just can’t change the dynamic. There are some people who just won’t stay away. It can be very disruptive and cause a lot of discord.”
Another consideration is the standing or status of co-founders and how it might shift over time. “I think money is the root of some problems, but another one for small companies with multiple founders or active partners is status. If one becomes more dominant – and this could be after several years, and maybe it’s well deserved, they have more responsibility, they’re just better at what they’re doing. That’s something else that an entrepreneur with a partner needs to be aware of: The fact that he could end up being the dominant one or the other guy could be. It’s hard to prepare for that. How you prepare for it is just knowing that it could happen and understanding it. Some people react fine to that, some people don’t.”
A Strategic Plan Brings Visions of Grandeur Back Down to Earth
We asked Twining whether he has also had to help founders set or re-set expectations because he sees problems afoot. We asked about this because we’ve heard two phrases from a number of our interviewees: “unrealistic expectations” and “misaligned expectations,” which then contributes to setbacks and mental health issues. “With any founder of a company, that is one of the main things I spend time on,” he answered. “It’s how to set expectations properly for yourself and others who are relying on you or on whom you are relying. Sometimes entrepreneurs have visions of grandeur and they believe it’s going to be an easy path to the top – they say ‘I can capture this percentage of the market’ and/or ‘I can make this much money’ – so bringing that all back down to earth is important. The way we do that is by working together to create a strategic plan.”
In particular, Twining likes the one page strategic plan developed by Verne Harnish, who’s quite an entrepreneur himself and author of Scaling Up. While it has all of the elements of a typical plan from the mission statement to SWOT analysis to short- and long-term goals and objectives setting, this one page document cuts to the heart of it by forcing you to be extremely methodical about it; and it provides clarity by putting it all right in front of you on a single page, rather than burying good stuff into a 5, 10, or 15-page document. “It’s a great way for any size organization to think through and document their strategy,” Twining concluded. “And strategy is a prerequisite for setting expectations, and getting everyone in alignment.”
But it doesn’t end there – assessment of and adjustments to the plan need to be ongoing. “An entrepreneur or any business, on some regular interval, needs to reassess their goals and what they’re trying to accomplish, and either reaffirm what they set out to do earlier or adjust it in some fashion,” explained Twining. “And they need to never stop doing that. It goes on until the company doesn’t exist any longer. It takes stock of where are we now; what are our strengths and weaknesses; what opportunities do we have; and what are the threats to the business. Why are we even doing this? Why are we in business? What is our ultimate purpose? What are our values? What values are important to us? If there’s one founder, he needs to articulate it. If there are two or more founders or working partners, they need to agree on it.”
Build in Accountability to Achieve Goals
It’s important to note that the one-page strategic plan leads to detailed responsibilities, tasks, and timetables – and it doesn’t matter if it’s just two co-founders or a team of a hundred. “This process gets very granular,” Twining said. “The assigned tasks that team members commit to are very specific, as is the timetable when trying to reach specific goals – everybody’s got a date for their commitments. They can’t put it off without reporting back to the group that they’re going to miss it; and they can’t let themselves off the hook, even if it’s just a few guys doing it. They need to keep the pressure on each other … in a way that’s healthy of course.”
To make the big, long-term goals attainable and manageable, you need to break them down into bite size chunks, explained Twining. “What are our primary objectives for three years from now, then what do we have to do in the next 12 months to get closer to that? Then you break that down to what do we need to do in the next three months to get closer to that annual objective, and then who’s going to do it, and when are they going to do it? Then you hold each other accountable; the team holds each other accountable. You all know you’re going to hold each other accountable.”
To put it in plain terms, Twining relayed how sometimes when he’s driving in his car he hears an ad on radio that always grabs his attention because it resonates with him on how a business should be run. While he admits the ad guy sounds like a used car salesman, Twining noted, “There’s one thing that he says that I think is so simple but so true. It’s ‘Business is not about doing 10,000 things really well, it’s about doing eight or 10 things really well over and over again.’ I really buy into that. I think communication and alignment is a big part of that.”
“That’s kind of a broad-brush approach,” he summarized. “You have a strategy you agree on. You’re in alignment. You adjust it regularly. You revisit it, you adjust it, you revisit it. It just never ends. The planning is very fluid, it’s very dynamic. You check in every 30 days to see how you’re doing. If there is a person holding you back from meeting goals, you need to decide whether they should step aside. If it’s you, the founder, you need to ask yourself, ‘Do I commit to doing something more than this, do I hand off my responsibilities to someone else, or do I fold up the company and leave, and go work for someone else?’ Most entrepreneurs never do a plan or they wait way too long to do one. If they are unorganized, unless they’re really lucky, chances are that they’re going to end up working for someone else pretty soon. There’s no shame in working for someone else it’s just usually not what they dreamed of.”