Better Before Bigger

Pretend for a moment you are the proud owner of a coffee company. The lifeblood of most organizations today, your selling productivity and joy one pound at a time.

Your company sells bags of coffee for $10.

It costs you $9.00 to produce, leaving $1.00 in profit.

To summarize, that’s $1 of profit for every bag you sell. If you wanted to make $2, sell two bags. For $3, three bags. Obvious, right?

Simple Answers vs Simple Solutions

For most managers and business owners, the answer feels simple. To increase cash flow, increase sales. To generate more money, sell more of a product or service. This is a widely accepted practice and it can work.

Imagine however, you took a different approach. Instead of seeing sales as the first step to growth, what if you opted for efficiency. Increase the value of the revenue you already have. Rather of trying to sell twice as much, what would happen if you simply got 10% better?

A 11% improvement on $9.00 in expenses would result in 99 cents increase in profit per bag.

Increase efficiency by 11% or increase sales by 100%, the result is the same.

Real Growth

Continuing the exercise, imagine start selling your product to a local grocery store chain. Then, you sign a deal with a series of farmers markets. Now, you’re selling 10,000 bags per month. You’re business has annual sales of over one million dollars. Impressive.

As you look to the future, you’re faced with a gripping reality: Unless something changes, increasing available cash flow means continuing to apply more effort. Selling more coffee means more inventory on hand, more staff, more warehouse space, more customers, and more distribution channels.

Better Before Bigger

Before trying to get bigger, what if you focused the same effort on getting better. Better before bigger. Without doubling sales, you focus attention on streamlining efficiency, cutting costs, and delivering the same product with less effort. Increasing value while decreasing costs. It doesn’t have to be massive effort with systemic change, but incremental improvements.

For this coffee business, setting your team’s attention on just 1% improvement each month would yield double the profit in just 8 months. Within less than a year, you would experience increase cashflow and increased capacity without any additional revenue.

What’s right for you

Every business is different. There are those who sell products, others sell services, and others still who sell software. The numbers may be different but the correlation between sales and efficiency remains the same. You can always push to get bigger, or you can start with getting better.

If you commit to the process, the latter often yields greater results with much less effort.

Shoes Matter Most

In high school and college, I ran hundreds of miles every month. Whether competing or staying healthy, running can take a toll on the body. From back pain to hip issues, knee damage to shin splints, for every healthy runner there are two injured ones.

Early on, a coach shared the importance of footwear. He was constantly inspecting our shoes and routinely pushing us to replace them. Years later an orthopedist discussed the correlation between the feet and the rest of the body. He made a compelling that suggests most physical ailments we experience can be attributed to our footwear. Most major problems with lower back, hips, knees, shins, and arches… all from our shoes.

The problem originates from how we shop for shoes. Since we can’t log hundreds of miles before making a purchase, we stride to the end of the aisle in store. If they get delivered to our house, we may venture outside and walk to the end of the driveway. Of course, it’s unlikely that any problems would emerge in so little time. It’s the wear and tear that eventually breaks us down. Drip, drip, drip.

The Subtle Source

Much of life follows a similar pattern. The greatest problems we face stem from seemingly small sources played out over long periods of time.

Over the course of our lives, about 5% of our time is spent with our parents. Think about how much they’re able to influence who we become.

In our careers, we spend thousands of hours with the same roles and responsibilities. Most of those decisions were made before we got hired, when our employer knew the least about us.

In building a business, a handful of moments, relationships, and conversations can shape the direction of the entire company for decades.

Most problems and pains we experience are often just symptoms. While we can’t rewrite our journey, we always have the power to simply change our shoes for the road ahead. If we’re lucky, it might even remind others to do the same.

Spilling Secrets

Over the years I’ve found myself defaulting to complete transparency. It’s helped me develop a feeling of authenticity and a deeper sense of generosity. If I have a perspective, experience, or behavior someone else might benefit, it feels selfish to stay quiet.

This openness and vulnerability intensified around the 5 year mark in our business. Following a near catastrophic financial issue for the business, I found myself scrambling. It was a desperate attempt at survival that led me to reach out to mentors, friends, and even strangers. The support and encouragement was humbling and invaluable. In turn, I’ve sought to do likewise. Rather than limiting it to those bold enough to ask, I began writing more and sharing it with those who might not feel comfortable reaching out.

Throughout this season, I also felt a prompt to express gratitude to those who had helped us along the way. Our business has been built on the support and generosity of friends, families, and clients. At first, it was about giving me something positive to focus my attention but evolved into being more about the recipient and cheering them on in their journey. Either way, it aided me through the troubling time.

What about competition?

Naturally, this sparks conversations about trade secrets and giving away our competitive advantage. I’ve heard dozens of solid arguments that keep me questioning the merits of my approach. To date, I am undecided. Until I receive compelling evidence to the contrary, I’ll continue default to unbridled transparency. We have become more articulate with our clients, move to transparent salaries internally for team members, and even began passing along helpful strategies to competition.

Aren’t you worried about companies copying you?
What if you share too much?
Could someone beat you at your own game?

Bring it on. Personally, I love the accountability that surrounds transparency. It forces us to have our own house in order and continually improve. As we invite peers and competitors to compete at our level, high tide raises all ships. Plus, if you’re the overly competitive type, it’s actually advantageous to put yourself in a position where competitors are following you. Copying you means they are focused on you, while you’re free to focus on serving your customers or clients. You have them right where you want them.

It’s also worth noting that what works for me and my businesses will not work for everyone. For instance, transparency without accompanying integrity will end poorly. Also, following our process without the deep conviction in it’s value will result in unsavory outcomes. Doing the same thing, with different intentions, will not produce the same results.

No Secret Sauces

Think about your favorite dining experience. It’s unlikely the restaurant only has good food. They need more than great atmosphere. Attentive serving staff is not enough. My favorite restaurant has a great vibe, knowledgeable waitstaff, impeccable hospitality, delectable food, and delivers that experience every time. It’s the full experience. There is no special ingredient or a secret sauce, it’s about the full package.

In the same manner, I want to be a person where unrelenting generosity and unending gratitude are my differentiators. Not as a secret, but to be enjoyed by all.

Keeping it Practical

There is also a level of practicality to the process. Given the dozens of meetings I have each week, it’s exhausting to decide who I’m willing to share information with. Is there a conflict? Will they steal the idea? Can I trust them? No one knows. Rather than fixating on which version of the narrative to preserve, I’m freed up to share openly.

In parting, I’ll pass along a quote from Zig Ziglar what echos in my mind, “You will get all you want in life, if you help enough other people get what they want.” Living this way, I’m amazed by how fulfilling the work becomes when I stop making it about myself. Instead, choosing to focus more on adding value to others.

Clarifying Company Values at Polar Notion

As a company grows and evolves, values become indispensable in guiding decisions. I’ve found few things to be more impactful in facilitating a healthy culture. Values govern how we operate. They summarize what matters most.

Sometimes however, it’s helpful to dive a bit deeper into defining what they actually mean to us. While values like ‘passion’ and ‘innovation’ can be telling, they fall on deaf ears without context, explanation, and examples.


We pursue excellence, not perfection.

Rather than pushing for perfection, which is illusive, we pursue excellence. For us, excellence is exemplified in 4 ways.

We produce quality products.

Is the work we’re doing quality in the eyes of our clients and our peers? Not everyone has to ‘get it’, but our attention to detail and thoughtfulness should be evident. Standards change over time but we want to set the bar ever higher.

A great example is our Client Handbook. It’s quirky and playful, yet obviously deliberate.

We learn from our mistakes.

First, it’s important to note that we should be making mistakes. Mistakes should not be a result of sloppy execution rather attempting to achieve greater heights. If we accomplish everything we set our minds to, it’s likely we are not challenging ourselves enough.

Secondly, are we learning. We shouldn’t be making the same mistakes over and over. Reflection and improvement are key.

In late 2015, an app got rejected from app store approval due to misuse of GPS functionality on the device. Rather than merely fixing it and moving on, we explored the reason behind the problem and ensured that every product since complies appropriately.

We improve continually.

Are we getting better? Whether we are learning from our mistakes or anticipating challenges ahead, we value improvement. A refusal to change leads to arrogance and complacency, which is death of the creative and craftsmen. Our minds are constantly open to trying new things.

During 2017 and 2018, our processes have evolved to be almost indiscernible from previous years. By applying feedback from our team and clients, we’ve tightened feedback loops, improved transparency, and distilled the process into a clearly defined system. We’re able to deliver industry leading precision… and the work is not done.

We seek customer validation over untested theory.

Does the idea survive outside of the board room? We push ourselves and our clients to release something into the wild and be ready to iterate. Designing in a vacuum causes things to take longer than necessary and removes empathy from the process. Things move fast and we want to be people who lead the way.

We time box Strategy Sprints. By caping the amount of time we have to plan, it prevents us from over-engineering or dwelling too long on details that just need to be tested. There is only one way of knowing what the customer actually wants: show it to them.


We create remarkable experiences.

In service based work, merely delivering what’s expected will prompt a race to the bottom that we’re not interested in winning. Experiences are what separate the boutique from the commodity.

For our team, we focus on each level of the exchange; team members, clients, and their customers. Human-centered interactions share value at each step.

The most beautiful element of commerce is that two people can come together in an exchange and each party walk away feeling like they’ve won something. We strive to exemplify that within each transaction.

Remarkable experiences for our team members.

Does our team enjoy the work? The decision to list our team members is deliberate. A healthy work environment is the life blood of a creative agency and ensures everything else is in proper balance. Neglecting team members in pursuit of pleasing clients will lead to an atmosphere where neither truly win.

If you’re a client, we trust you’ll appreciate the passion and joy our team brings to our work together.

Remarkable experiences for our clients.

Do our clients enjoy the process and product? In an industry filled with jargon and miscommunication, we lead with clearly defined expectations. Continually reevaluating our level of communication, we take ownership of educating our clients and removing confusion.

We make this easily measurable. After each sprint, we ask for feedback and they’re given a chance to rank our performance. We shoot for 5 stars.

The work and attention to detail within our Client Handbook is just the first step in delivering a 5 star experience. We’re proud that our business continues to grow rapidly while driven by referrals. Each new project stems from a previously delighted client.

Their customers.

Do our clients’ customers stay engaged? We’re trusted to represent our clients’ brands well. When our clients win in the eyes of their customers, everyone comes out on top. We never want to loose site of who we ultimately serve.

Great design involves empathy for the end user.


We are effectively human.

Perhaps our most loaded value, being effectively human captures the marriage of technology and humanity. In the world of software, hardware, AI, and technology it’s easy to get lost in a sea of cold, lifeless machines. We want to capture the efficiency of cutting edge technology without loosing our humanity in the process.

We lead with a human centered perspective.

Who are we optimizing for? Keeping the main thing front of mind, people are the greatest prize and what we optimize for. Revolting against the industrialization of humanity, we see people as unique contributors in an ever evolving story.

We engineer thoughtful, simple solutions.

Deliberate and simple pursuits are a mindset we impress upon those we work with. We use words like engineer and strategy because they evoke an attitude of thoughtfulness. More than a title to be claimed, it’s a mindset that we expect at every level of our organization.

We engage in thoughtful debate.

We disagree often. Championing the notion of ‘strong beliefs held loosely’, few conversations are off limits. We reject the idea that we have to agree to interact respectfully. Diversity and unique perspectives drive us towards the best outcomes.

Respect and disagreement are not mutually exclusive.

We seek empathy before efficiency.

People over process. As we grow, efficiency and humanity continually square off. Rather than building a sterilized environment without blemish, we celebrate the tension and hold individually as a basic human right.

Our greatest work has come from being open to unpredictability.


We go boldly forward.

Our fourth and final value, Go Boldly Forward is our battle cry as much as a directive.

What do we do next? Go! Refusing to stay still, we are moving.

How will we go? Boldly. With courage and confidence, we take risks.

Where will we go boldly? Forward. We live in pursuit of the future, not the past.

We default to action.

Rather than waiting for permission, we prefer deliberate action over indecision. If you care or have an opinion, speak up and go get it.

We openly share our systems and processes because it’s action, not knowledge, that makes all the difference.

We make decisions.

Fighting against endless debate, we step out from the crowd and make a choice. Perhaps our most aspirational element, we challenge each other and ourselves to decide. Pick something!

A good decision now beats a great decision later.

We nurture a humble curiosity.

Try things. Explore. Venture out. Whether the services we provide or the clients we entertain, we love life outside the box. We don’t have the all answers, no one does. That’s not going to stop us from trying to find them.

We take risks.

Try things that might not work. Balancing a healthy dose of experimentation, we like new challenge rather than rinse and repeat. Humans are adaptable and few things exemplify that more than risk taking.


In Closing

While these values play out daily around the office, we hope they’re embodied to touch all areas of life. Excellence, delightful experiences, human centeredness, and courage allow us to confront the choices on all levels. Healthy values should build a better business and a better world.

When our values come alive throughout the organization, it’s obvious ‘how we do things here’ and it is something worth protecting.

We pursue excellence, not perfection.

We create remarkable experiences.

We are effectively human.

We go boldly forward.

We are Polar Notion.

Valuing What Matters

In 2017, we bag pushing harder to remove the barriers that prevent our team from doing great work. We are creating a transparent work environment from project management, to educating clients, and beyond. The goal is to do remarkable work and inspire others to live remarkable lives.

As part of this push, team member compensation races to the forefront. Compensation is an area riddled with confusion and chaos. To combat the tension, we introduced transparent salaries. With that, we’ve been working through clearly defined expectations for each level and per role. After much deliberation and great advise, we identified 8 key areas.

Each role without our business has requirements around Culture, Evangelism, Values, Experience, Leadership, Client Interactions, Industry Involvement, and Domain Knowledge.

Culture

Our team comes first. We spend most of our lives at work, so building a place we all enjoy is of primary importance. Contributing to the culture is everyones job.

In the book The One Thing, author Gary Keller introduces the value in finding ‘the one thing, such by doing everything else is either easier or not necessary’. For our business, culture is that thing. When the team enjoys the work and those they do it with, everything else improves.

Evangelism

Without going as far as saying sales is everyone’s job, our brand in the marketplace should be on everyone’s mind. It’s through consistent interactions that ideas spread.

Our leadership team is continually striving to facility an environment worth of sharing with others.

Values

Company values belong deep within the heart and mind of the organization. Rather than allowing them to live and die on posters around the office, we should all be growing in and championing what makes us unique.

We pursue excellence, not perfection.

We create remarkable experiences.

We are effectively human.

We go boldly forward.

Experience

Real world experience is vital. As we cross train our team members to be well rounded, personal growth still takes time. Tenure is often overstated but it has a place among professionals. Rather than measuring time, it’s helpful to think in terms of experiences.

As leaders, it’s our responsibility to make sure the time spent is value-filled. For young engineers in particular, it’s normal to keep handing them low-hanging bugs and features. Unless they’re given the opportunity to practice higher level skills however, we shouldn’t be surprised when they burn out or look elsewhere.

Leadership

Our team should be setting the bar and guiding others forward. More than a title, everyone’s role has elements of leadership baked in. The responsibility of a craftsman is to pass down their expertise, not merely excel in their own pursuits.

The more our team learns, the great the expectation to lead. All four of our values embody this with our use of the word ‘we’ throughout. We pursue excellence, not perfection. We create remarkable experiences. We are effectively human. We go boldly forward. We don’t work alone and we bring others along with us.

Client Facing Skills

In a service-based business, producing remarkable experience for clients is everyones responsibility. Whether demoing to a client demos, fulfilling work, or helping someone think through strategic direction, everyone should have a growing level of care and confidence in client interactions.

This aligns with a company value: we are effectively human. We should be able to translate our work and communicate it effectively to clients who have commissioned it.

Industry Involvement

We should not be operating in isolation. Shaping the community is a group effort. Whether through conferences, meetups, or mentoring it’s likely our early days are as participants but overtime we should step into greater responsibilities.

Creating remarkable experiences shouldn’t end when the work day is over. When we take ownership of the world around us, it’s an attitude that comes home with us and should influence our industry.

Knowledge

In a fast-changing industry, leveling up our knowledge and understanding is mandatory. As technology rises and falls, our ability to adapt is what sets us apart.

When we share about going boldly forward, expanding our knowledge is implied within our forward momentum. We are not settling for what we have always done or who we were back then. We look to what’s next.


With clarity into what matters most at each level of the organization, it creates clarity that team members can understand and explore for themselves. Rather than limiting their growth or perpetuating inequality in the workplace, there is a shared accountability. Team members are responsible for their growth and the company is responsible for compensating them fairly for it.

We Teach Others How to Treat Us

In high school, I had a manager at work who was rude, deceitful, and generally unpleasant toward me and other team members. It was frustrating and counterproductive.

In hindsight, I’m forced to face a startling truth… it was my fault.

While I did not force his hand, his continued behavior was a result of my compliance. Every inappropriate comment, snide remark, or crude gesture that I tolerated, I inadvertently communicated to him that it was acceptable.

We teach others how to treat us.

The same principle holds true throughout life. Regardless of the words that come from your mouth, the behaviors you allow from others set the tone.

Your boss sends you 11pm email when you’re with family. If you respond, you reinforce that behavior.

A coworker shows up 15 minutes late to a meeting. If you’re still in the room when they arrive, a precedent has been set.

A customer demands a a discount. If you comply, expect more of the same.

In the end, repeat abuses are not their fault, they’re ours.

We teach others how to treat us… teach them well.

 

Originally posted on Medium.