Andre Durand

Discovering life, one mistake at a time.
Subscribe

Leadership Philosophy

November 16, 2010 By: Andre Category: About Me, Entrepreneurism, Life, Ping Identity, You Can Quote Me

I have been an entrepreneur for over 15 years. Like many, I have made many mistakes along the way. Fortunately, I’ve have had the great benefit of having mentors with incredibly varied experience to help provide perspective and learning through these years. From these trials, tribulations and lessons, I have developed and honed a set of guiding business principles, which now define who I am as a businessman. I am sharing these principles in this paper with the hope that it will help both those deciding to take the venturous business route and those I work with today whom would like to better understand my business philosophy.

Principle #1: Pursue Good and Fair Profits

A fair profit comes from the melding of resources, over time, in such a way that the resulting widget is worth more than the value of the sum of the parts. This is the point in which true “value creation” happens. It means you don’t charge customers just because you can at a particular moment or circumstance – say an emergency. This is price gouging. Beyond being illegal in most circumstances, it is also a sign of an opportunistic company thinking of immediate term only. Good and fair profits leave both transacting parties in a place of satisfaction. The pursuit of fair profits speaks to the overarching integrity of an organization across multiple dimensions. Understand that your value will change over time depending on competitive factors and you’re ability to keep pace. “Good”, long-term profits means you have to keep up with growing customer demands. If you have leverage over a customer and you use it unfairly, customers will take note and pay you back at their earliest opportunity (e.g. think Blockbusters late return fee policy in the age of Netflix and video on demand.) If you care to build a sustainable business, balance profit taking of today with profit earning of tomorrow. Here are some things to keep top of mind.

● Pursue the win/win with customers in every situation.
● Strive to beat your competitors, not your customers
● If you decide one day you must stratify your products, “reach up” with augmented features and functions, versus creating a “reduced” version by removing features from the product you have. This is not value creation, this is value destruction.

Principle #2: Lead with Vision, Values, Culture & Passion

People are the biggest input to most businesses. Hire for passion, attitude, values, IQ and train for aptitude. Treat people with respect, create a positive working framework and then get out of the way and let them do their job. And remember that there is no substitute for passion, values, culture and vision. These are not just words through about, but descriptors to a manner of operating. Good passion, values, culture and vision cannot be faked. They are earned and owned. It’s how you lead, it’s what you say, and it’s how you live. Get this right and everything will fall into place. Get this wrong and you will always be sub-optimized. Ignore them entirely and you will fail eventually if not immediately.

Principle #3: Put People First; Put “We Before “I”

So many companies treat people like machinery with a defined output. This is short sighted and wrong. If you care to manage to the minimum bar, treat people like revenue producing units (“RPU’s”). If you wish to do something spectacular, put them first and let them put your business and customers first. If they don’t know that you have their back, they will spend their time and energy mitigating their perceived personal risk, and this deprives your customers and your business of energy and focus. When the needs of teams and the needs of individuals come to odds, focus on the team. Great accomplishments require a group effort.

Principle #4: An Unchecked Ego Makes Poor Decisions

There’s a saying that an “Ego is a terrible thing to waste.” A healthy ego is a requirement for entrepreneurs and their early teams as cowering to rejection and self-doubt are the suicidal tendencies of a young company. Often times unfortunately, it’s the ego that tends towards narcissism and emergence of the destructive ego – an ego that is unhealthy and wasted. An ego that empowers with perseverance, not arrogance can only come through process of “self-actualization.”

When it comes to behavior motivated by ego, the ends do not justify the means. Perhaps if you’re one-dimensional and only care about short-term profits, you can manipulate people, customers or future debt to obtain unfounded near-term profits. But if you look at winning holistically and consistently, and take into account winning across every dimension, you cannot make good decisions based upon ego.

Watch for the ego-driven individuals feeding their own need to stoke the savior complex by lighting the very fires they must organizationally extinguish. It makes them a hero and it feeds their ego. You won’t see them actively lighting a fire, most do it unconsciously by not pro-actively managing the business. They key to successful management is to head off a fire while it’s yet a trace of smoke. Ignore it and you have a fire, and an opportunity for an ego to become the hero.

The other place where ego’s get into trouble is in expectation management. An ego driven individual is motivated to receive praise in the moment. This leads them to create unrealistic goals and expectations to receive praise in the moment. This behavior inevitably leads to situations where a company under-performs to expectation. Everyone loses when this happens.

Principle #5: No Short-Term Decisions

Many companies and management teams are plagued with short-term thinking and a focus on short-term gains. Many incentive plans only exacerbate the issue, focusing on quarterly or annual performance without due consideration for future ramifications. In stark contrast to the shorter-term American business philosophies are those of

The consequence of short-term decision making is that, over time, it will limit your future options, largely because they tend to compress tomorrow’s profits into today’s time frame, while pushing today’s costs into the future. The result of this over time is that you will eventually have to pay, and when this happens, you will lose people and market momentum. Perhaps this is sad commentary on the state of much of today’s leadership, but many appear driven more by short-term personal gain than by building world-class businesses and long-term market value creation.

Principle #6: Beware of the “Hail Mary Passes”

We all love the idea of the 11th hour win or the so-called “Hail Mary Pass.” It creates the dramatic Hollywood ending. If it happens, be thankful, enjoy the drama for one minute, and then figure out what when so terribly wrong with the business that the ending of a financial period was met with the unexpected. When you rely upon a silver bullet or a Hail Mary, you place your future in the hands of luck. This is a poor strategy that will likely end badly – statistically. Remember the following when you plan to win by Hail Mary:

● If it’s worth doing, it’s worth doing right. See “Think, Plan, Aim, Act”
● If you believe that balance is the key to sustainability, and strive for the win/win, you abhor living a roller coaster ride of ups and downs (optimism followed by reality)
● You will understand and appreciate the beauty in having near term focus on long-term gain.

Principle #7: No Future Debt

Don’t push the true cost of today’s actions into the future or worse yet, onto others. The first is a bad strategy, which will harm you later, and the second is simply wrong.

Principle #8: Maintain Balance

Finding and maintaining balance is hard. Our society teaches us to be myopic and short sighted. Yet achieving balance creates a foundation for sustainability. It’s powerful when given time to work, but it is an investment in your future. If you don’t plan to last, perhaps you don’t need balance. You can sprint and subsequently crash. Planning for short-term outcomes can be profitable, but it’s risky, because it limits your future options and creates a future debt that eventually you will have to pay. Some don’t worry about the future debt they create because they don’t intend to pay for it themselves. Instead, their strategy is to make it someone else’s problem. This strategy lacks integrity.

In nearly every decision, a view towards balance should be considered.

● How does this short-term decision impact us long-term?
● How does our focus on tactical execution not set us up for the future (strategic)?
● What takes precedence when work and family life are fighting for my time, attention and energy?
● If I sprint now, how long will it take to recover such that I can sprint again? Is now the right time to sprint or is now a time to conserve energy and resources?

Principle # 9: Innovate!

Innovation is how we grow the pie or create matter from energy (something tangible from an idea). It’s the foundation of abundant thinking and a win/win philosophy. Innovation comes from within. Don’t expect your customers to lead you to innovation- they may not know what they need or want until you show it to them. You need to think out of the box to innovate – and this is the core of entrepreneurialism. Focusing on the problem at hand won’t get you there. You need to think non-linearly about problems. Often times, scarcity is the sandbox of innovation — which is in of itself ironic. It’s ironic because scarcity is the spring well of abundance.

Principle #10: Run Lean. Always

Just because you can throw money at a problem doesn’t mean you should. In fact, it likely is the worst thing you could do, and it’s lazy. It deprives you of the creative solution (e.g. an innovation opportunity) and it saps the company of precious resources that could be used more effectively elsewhere. Running lean doesn’t mean run your resources to zero. It also doesn’t mean run your existing resources at 90%+. Save for a rainy day and unexpected events that are beyond your control. Running lean day-to-day saves resources for when they’re really needed.

Principle #11: Be Pro-Active

I measure myself on the number of fires I need to put out. If I’m putting out fires, I’m failing. A form of future debt is denial and neglect. Neglect an issue long enough and it becomes a fire. Neglect it even longer and it becomes a firestorm. Think of fires as a symptom, not a cause. The cause was that someone was playing with matches in the forest on a hot dry day. I have a saying, “Run the business or the business will run you.” I prefer to focus on causes before they become fires. It’s a matter of being proactive rather than reactive. I’m not lazy, but being preemptive is actually a lot easier and less time consuming than dealing with symptoms. When things become a fire, they spread to other departments and take an emotional toll on the company. This saps productivity, energy and enthusiasm. Of course, being preemptive won’t feed your ego, but if you spend all your time fixing things, you’re simply doing it wrong.

Principle #12: Bad News First

Good news is energizing, but it shouldn’t come at the expense of the truth.

Principle #13: Stay off the Roller Coaster

Compressing future profits into today’s consumption creates bubbles. Invariably bubbles burst and this in turn leads to emotional highs and lows. Like being on a roller coaster, but only fun for the first few seconds. I love roller coasters, but I hate being on one with my business. I’ll take slower, steadier growth any time. It’s easier to manage, it’s easier to create expectations around and it won’t give me whiplash.

Strive for Better
In business as in life, I truly believe there is no *final* destination. It’s a series of challenges and summits followed by a series of challenges and summits. It ends when you want it to end, or when your poor decision-making forces it to end. “Best” is at best — temporary. There is always better. Life is a journey in which, as long as you’re alive, you can strive to do better.

Principle #14: Simpler is Better

The world can be complicated enough. Don’t make things more complicated. It’s a true gift to distill complex problems into their simple essences to better understand them. Until you truly understand the essence of the problem to be solved, it will be hard to fix the issue.

Principle #15: No Failure, only Learning

When you fail, you haven’t “failed” unless you haven’t learned. Pick yourself up and try again. Anything and everything can be achieved with will, passion and hard work.

Principle #16: Actively Manage Expectations

Whether you’ve won or lost is largely a matter of your expectations. Setting the right expectations, achieving them and then exceeding them early can create an uplifting vortex of momentum that carries you and an organization into over-achievement. Creating the wrong expectations can demoralize you and a team from the start. If you allow your ego to penetrate your decision-making, you’ll set poor expectations. It’s smart to leave some margin in your back pocket. You live the glory of your annual forecasts but once a year with a board. You live the results of your forecasts the following 12 months. Under promising and over-delivering is a lot more fun. Trust me.

Principle #17: Causality is Real (Cause & Effect)

You are not a victim. You are in control of more than you likely assign to yourself. If you take the time to retrace your actions, you’ve had some part, likely significant, in every circumstance that surrounds you today. Taking ownership of that fact is a powerful tool. It means you’re in control and can effect change. Don’t sell yourself short by blaming others for your circumstances. Own your situation. Be accountable.

Principle #18: Think, Plan, Aim, Act

Fools rush in and false starts are more expensive than you likely realize. If it’s worth pursuing, it’s worth the time to investigate, plan and do it right.

Principle #19: Lead. Don’t Manage

People don’t want to be managed. They want to be led. If you’re not familiar with the concepts behind servitude leadership, read up. If you look out for people, your people will look out for your business. People don’t work for you. You work for them. You’re job is to make them successful. Full stop.

Principle #20: Turn Art into Science

If you don’t understand it, you can’t repeat it. If you can’t repeat it, you can’t scale it. If you can’t scale what’s working, you’ll never be successful. There is an art and a science to everything. The art is beautiful. It’s like magic, you can’t explain it, but you love the outcome. When you’re lucky enough to have a person who has the art of making something work, consider yourself lucky, but don’t rely upon it. You’re job is to turn the magic into science, to demystify why something works and turn it into a simple, repeatable processes which can be achieved by mere mortals.

Principle #21: Intelligent Reaction

You may be smart but you won’t predict everything. Adapting to a changing environment quickly is a weapon not just of survival, but also of offense. To any surprise in life the human mind has to distinctly different modes that tend to fight each other. One is that of emotion and the other of the mind. It is the leader’s responsibility to tap the motivation of emotion while harnessing it with the composure of the intelligent reaction. After all, business is ultimately supremely rational.