“It’s very difficult to develop a company without knowing what it is you’re trying to develop,” says OpenView Venture Partners founder Scott Maxwell. In our latest podcast, Scott chats about why it’s so important for early and expansion stage companies to clearly define their mission, vision and values, and why the challenge of doing so is worth the reward.
Brendan Cournoyer: Hello again, everyone, and welcome to this episode of Labcast. I’m Brendan Cournoyer, and today we’re joined by Scott Maxwell, founder of OpenView Venture Partners. Scott, today we’re going to talk about company aspirations. Our new eBook, What Really Matters, really goes into giving people a guide for defining and realizing their company aspirations.
I know this is a topic that’s really important to you. You’ve worked with a lot of young companies. Why is defining and developing these aspirations so important?
Scott Maxwell: Well, I think the basic issue is you can’t get somewhere without knowing where it is you want to go, and at the early stages of a company development, it’s typically about some sort of problem that exists in the market or opportunity that you see in order to develop a product that adds some value in the market and meets some sort of user needs.
But as you do that and it starts becoming clear what the customer segment is that you’re going after, the type of use cases that you’re going after, the product features that you’re trying to create that will meet those user needs, and the aspects associated with actually getting the product sold, etc., as you start getting clear on those, and we call those product development and customer development, and you want to scale up, that’s all about company development. It’s very difficult to develop a company without knowing what it is you’re trying to develop.
So, aspirations are really the longest term goal that you have for the company and the company development, and the way that we simply think about it, there are lots of ways you can think about it, but those longest term goals break down into the: why are you doing what you’re doing; what is it that you’re trying to achieve; and what are the values or principles that you’re living by as you actually try to achieve those things.
Brendan: Now that being said, a lot of companies still don’t take a real formalized approach to developing those aspirations. Maybe they don’t take it as seriously as a concept, or they maybe dismiss it altogether. Why do you think that is?
Scott: Well, I think there are a couple of reasons. Earlier companies when they’re just trying to figure out how to meet a specific customer need, they don’t need these things because they’re really trying to sort out what is it that we can deliver to the market that will actually create some value. And thinking about company development when they’re really early on in the mode of product development and customer development doesn’t make sense.
As companies grow through, your point is still a good point. They’ve gotten their product market fit, and they’ve gotten to a level of product development and customer development that it makes sense to start thinking about company development. Most companies either skip by company aspirations, or they develop something that they then don’t live by.
I think the real reason is not that many companies have actually spent the time to be real clear on what their aspirations are and then drive those aspirations through the company in a way that there’s a shared set of goals that everybody in the company has that are those longest term goals.
Because of that, the models that exist out there are generally poorly written mission statements or visions for the company or values that the company turns around and doesn’t live by. And, therefore, people who have worked in those types of companies think, all right, that’s just a bunch of marketing stuff, and it’s not really something that’s important to the company.
Every once in a while there’s a company that comes along that starts serving really well as an example. I’m hoping that there will be more examples out there. Right now, I think the best example that I’ve got is Zappos, which I think the whole concept of delivering happiness and the culture that they’ve tried to create and clarity around the goals and actual activities that they’re doing that support those goals has been fantastic and a great model.
Brendan: Now, the eBook offers a real detailed approach for business leaders and companies to develop their mission, develop their values, develop their priorities, develop their vision, all as part of the company aspirations. It’s one thing for the heads of the company to have this stuff ironed out, but it’s not something you just put on a piece of paper and leave in your desk after you figure it out. This is something that you really need to instill in everyone in the company, be it entry level people all the way up.
What are some ways that CEOs and senior people can really help everyone really buy in and be a part and live these aspirations?
Scott: Well, I think there are a number of things. I think it all starts with developing the statements in a way that the people who are in the room, which hopefully is the starting point as the senior management team, and maybe it also includes some representatives from different departments, but there’s clarity around them. Everyone who is in the room as a starting point truly believes them and is ready to sign up for aiming in the direction of the aspirations, and that’s a hard thing to do.
It’s not completely clear whether aspirations are developed or discovered as a starting point, but ultimately whatever ends up getting written down and clear is something that the people in the room need to agree that they’ll spend the time actually living and communicating, trying to make sure that they’re driven through the organization.
Some simple steps that companies can take beyond that . . . I think, by the way, our eBook does a pretty good job of helping company management actually get to the point of clarifying what it is that their aspirations actually are, but post that it’s about communicating them. If there’s a quarterly meeting, for example, talking through the aspirations is always a good thing. If you’re interviewing candidates for positions, interviewing from the perspective of the values. Do they inherently walk in the door with the values that we have as a company?
If you get more people who walk in the door that way, the more aligned you’ll be ultimately with the value part of your aspirations. If you’re real clear on what your mission is and what your vision is for the company and people get excited about it, again walking in the door, that’s a really good thing. For the people who are already in the door as you try to start developing this stuff, making sure that they’re aware, as I said earlier.
They can be rewarded based upon different aspects of living the values by giving them tickets to this or tickets to that or just recognizing them with an e-mail to the staff that what a great job this person did as an example or recognizing them in a quarterly meeting. Going back when you’re actually trying to sort out your goals for the year or goals for the quarter or goals for whatever time period, trying to go back to your aspirations, looking at them and trying to clarify what could we do this period in order to get closer to our aspirations is another thing that reinforces the whole idea of trying to reach that really longer term goal.
I think there are a huge number of other things companies can do. Some companies will put posters on the wall. From my perspective, you need to be careful about that because you need to make sure that you’re actually driving towards living those posters, if you put them on the wall, but we have seen them, and they’ve worked really well for companies who don’t view their aspirations as words but rather view their aspirations as goals and take specific steps every period trying to achieve those goals.
The other point that I guess I would make is that the senior management team also needs to be open to the idea that they do things that are not completely aligned with the aspirations and need to be open to the idea of people in the company reminding them because nobody is perfect. But the more they can also be reminded about things that they could be doing that would get the company closer to the aspirations and take steps to actually recognize when they don’t do it and adjust what their actions are, the more people will recognize, okay, this is something that’s really important to the senior team, and therefore, perhaps it becomes more important to the employee base.
But ultimately, what you really trying to do is you’re trying to get a company that’s full of people who are really aligned with the aspirations that the company has, and the best way to do it is to constantly communicate it and to try to reinforce it.
Brendan: Now, it sounds like a lot of work. In the eBook on OpenView Labs, it states very clearly like, well, aspirations are work. It does take some effort and some thought behind it, and you’re probably not going to get it right the first time around. Would you say that having companies willing to put in the work that’s required to really do this right is the biggest challenge facing them as far as really living those aspirations and developing and defining them properly?
Scott: Yeah, I think that’s probably the hardest thing. Developing and living aspirations, it’s a long-term strategy, and it takes a long time to really get a company full of people who are generally aligned with what you are trying to achieve. I think for young companies there are a lot more fire fights that are going on, on a daily basis, weekly basis, monthly basis that make it hard for them to spend the time on those longer term strategies.
But ultimately, as a company grows, the hope that I have for companies is that the senior management team is able to more and more step away from the day-to-day and work on some longer term payoff items that will help to build a great company. If they can, this tends to be one of the practices that is incredibly valuable for companies, and if they can’t, I think they’re going to miss out.
Brendan: Well, Scott, thanks again for taking the time to talk with us today. The eBook on OpenView Labs is What Really Matters: A Guide to Defining and Realizing Your Company’s Aspirations. People can check that out and download it for free for more information. Thanks again. Hope to talk to you soon.