Thursday, October 25, 2012

Phone systems

We've been using a Skype in number for all our phone calls but we're starting to reach the limits of what this system is good for, so we're in the market for a basic phone system. Below is an outline of what we're after. Does anyone have any good recommendations of VOIP/phone companies they use?

  • We are looking at having (preferably) a phone or VOIP System with approx 5 lines, give or take, with capacity to expand should we need.
  • We would look at having 2 incoming phone numbers. One for media enquiries and general office calls, with 1 line attached, the second for customer enquiries, that would divert to one of the other 4 lines.
  • We need for approx 4-6 handsets, with the ability to transfer calls easily between.
  • The ability to switch phones direct to voicemail when office is closed/all lines are in use.
  • Ability to utilise headsets, either plug in or bluetooth.

Image credit

Monday, October 22, 2012

Feedback - a gift that nobody likes to give?

This post was originally published on Start Up Smart.

I recently shared with the Sneaking Duck and Shoes of Prey teams some training on giving and receiving feedback. I learned my approach at McKinsey and it has been tremendously useful for me both at work and at home.

I started with a question: “who likes to get specific and helpful suggestions to help them work better”. Everyone put up their hands. But when I asked “who is entirely comfortable sharing feedback with colleagues”, nobody put up their hands. I think there is a huge opportunity from effective feedback and the model below is aimed at finding a realising this.

Below is how I try approach feedback - what other approaches have people found successful?

Getting the environment right

I’ve learned through my career that feedback only works in an environment where both parties are completely comfortable that mutual improvement is the goal. As soon as there is any sign of politics, revenge or point-scoring it’s a disaster. Creating this environment takes times and trust - I’ve put below a few key ways to create this:

Be objective – fact-based discussions are less likely to lead to emotive discussions
Be direct – addressing things head-on helps both sides understand what is the issue than ‘hinting’
Avoid defensiveness – re-hashing the past often leads to frayed tempers and emotion
Keep specific – if you don’t have specific examples, you perhaps don’t have something useful to share
Lead people through the whole story – don’t start with the solution
Think about the setting – is a public or private forum best?
Be considered – it’s probably best to write feedback down ahead of time

The model

The model that McKinsey taught me works like this:

Step 1 - Observation
Giver: Shares a specific observation. Done in a factual, non emotive, way. It should be sufficiently precise and clear that discussion isn’t necessary.
Receiver: Listens. Calms defensiveness.
Example “I notice that you have been 15 minutes late to the last 3 team meetings”

Step 2 - Impact
Giver: Shares a specific, observable impact that is directly related to the action. Again, it should precise clear
Feedback receiver: Listens. Calms defensiveness.
Example “This has the impact that meetings start late and the rest of the team has to wait when they could be doing other things”

Step 3 - The pause
Giver: Pauses. This is really the most critical step. You’re probably a bit nervous and rushing - you’ve thought about the conversation 100 times, but remember it’s the first time for the other person. Breath!
Receiver: Clarifying questions, if necessary. The key here is clarifying - about ensuring shared understanding of the observation and the impact. It’s essential to avoid the traps of explanations, defensiveness or anger. It’s important not to move onto discussion until the issue is clear and agreed.

Step 4 - Suggestion and discussion
Giver: Make a clear and specific suggestion as to how to avoid this in future (or continue if it’s positive feedback!). This will be just a suggestion - you may not know the whole story, so it’s unlikely you can legislate a solution, even as the boss.
Feedback receiver: Listen, and engage in discussion about how to avoid this in future. Remember, we’ve only got to step 4 if the observation and impact are agreed.
Example: “One suggestion is to set a 10 minute reminder on your phone”

At this point, as the feedback giver, you may well learn something you didn’t know that renders your suggestion useless. For example, perhaps the person’s issue is that their only public transport option doesn’t get them to the office in time and that a better suggestion is to move the meeting.

Finally

I have found this approach very useful personally and professionally. After sharing with the team I got positive feedback - it will be interesting to see how effectively we are able to put it into practice.

What other feedback approaches have people found effective?

Photo credit

Friday, October 19, 2012

Shareholders' Agreements

Great blog post by Rebekah Campbell from Posse with an open and honest discussion of her biggest regret - not having a proper shareholders' agreement in place when she started the business.

We had a half baked agreement when Mike, Jodie and I started Shoes of Prey, though we never actually put that into writing. Fortunately that worked out fine, when any issues around shareholdings came up we were able to work through those and end in a place where we were all happy, but we left that open to some risk. Once we raised capital and involved professional investors in the business we had lawyers draft up a formal shareholders' agreement.

For Sneaking Duck Mark, Mike, Jodie and I put a basic shareholders' agreement together. We didn't involve lawyers in the process, so I'm not sure how well it would hold up in a court if things came to that, but the process of drafting it forced us to all sit down, think through and agree on how we wanted things like vesting to work. Plus the 4 of us knew each other really well and there's a high level of trust that we'd be able to work things through if there was ever a disagreement.

Having agreed to all the main points worked out really well for us at Sneaking Duck. When we raised money for Shoes of Prey we realised Mike, Jodie and I needed to focus more of our time on the Shoes of Prey business and less on Sneaking Duck. Because we'd already agreed how the vesting structure worked, it was easy to adjust our shareholdings and everyone feels that the arrangements are a fair one. This had the potential to be a more challenging process had we not thought things through and agreed to them beforehand.

I couldn't agree more with Rebekah's thoughts on this topic. And if you don't already read it, her blog is well worth subscribing to.

Tuesday, October 16, 2012

We're Hiring: Customer Happiness Wonderperson

Shoes of Prey is a global online retail brand that allows women (including Prime Ministers!) to design their own shoes which we handmake and deliver to them. We’re changing the way women shop for shoes and we’re on track to become a significant international retailer within the next 5 years.

As our business continues to grow, we’re looking to hire another customer happiness wonderperson to join Lucy, Anna and Marcela on our team! To passionately create happiness is our first and core company value, is something we prioritise immensely and has been core to our success to date. We love going out of our way to make our customer extremely happy. Your focus will be the happiness of our customers, you will be responsible for ensuring they're the happiest in the land.

Some of the key day to day activities:

  • Engaging with our customers over email in the most friendly, fun and supportive ways possible.
  • Doing the same with our customers on website chat and on the phone.
  • Assisting customers who visit our office to try on, see and touch our shoes.
  • Reviewing customer orders and sending these to the workshop.
  • Working with our team in China to track and manage our orders.
  • Helping develop and document our customer related systems and processes.

To be killing it in this role and considered an A Player on the Shoes of Prey team, here are the 4 key things you’ll have achieved after 12 months in this role:

1. You not only live and breathe Shoes of Prey’s culture and values, you’ve contributed to growing and developing them. People on the team enjoy spending time with you and are fighting to be able to work closely with you.

2. Customers you interact with regularly email us telling us how the customer service they received from Shoes of Prey is the best they’ve ever had anywhere. You’ve also helped us create experiences like this for our customers.

3. You consistently produce a high volume of high quality emails, chats and phone calls with our customers.

4. You’ve contributed to the growth and scaling of our customer happiness team. You’ve helped us set up processes which mean customers can access the information they need immediately, and if they do need a response from our team, they’re able to get that quickly and efficiently.

Your work experience clearly identifies that you have the following traits:

  • Passion for customer happiness. You’re passionate about pleasing customers and you’re seeking a career in a customer happiness role.
  • Passion for high volume, high quality work. We receive a lot of emails, chats, phone calls and customer appointments. You thrive in a high volume work environment and are able to produce top quality results at full pace.
  • Tenacity and scrappiness. You’re able to make things work with the limited resources at a startup. When things don’t go as planned and you’re missing your goals, you’ll go to the ends of the earth iterating, learning, pivoting and doing what it takes to hit your goals.
  • Collaborative. You work incredibly well within teams. You’re inspired by other people and you’re able to draw from and inspire the best in the people around you.

The total salary package for this role is $50k-$60k (based on experience) including super, bonus and stock options. As with all roles at Shoes of Prey, lunch + snacks + shoes are of course included! The role will report into the CEO, Michael Fox.

We’ll shortly be embarking on an offline retail experience for our customers in the Sydney CBD, and for the first 3-6 months of this Customer Happiness Wonderperson role we’d like the person we hire to commit to working at this location in a retail customer happiness role. We can promise it’s going to be incredibly exciting (more details to come on this blog over the coming months)! After a maximum of 6 months (and potentially less) the role will be based in our Surry Hills office.

If you think you have what it takes to please email your resume and cover letter to joinourawesometeam@shoesofprey.com.

Thursday, October 11, 2012

Career Ladders

When I worked in the Online Sales and Operations team at Google, one way they helped give us career direction and let us know what we needed to achieve to be promoted was a career ladder. The career ladder outlines the different levels within a department and what needs to be achieved to be performing well in that role.

We've recently created team ladders for our Software Engineering and Customer Happiness teams. I thought I'd share the Customer Happiness Wonderperson Career Ladder here.

The idea is that to be promoted you need to be exceeding expectations on the requirements in your current level, and be already performing the requirements for the next level up.

Not only does this provide guidance and motivation for the team on what to do to be promoted, but when we set goals each quarter we can look to the career ladder to identify what needs to be achieved for that team members development, and we can aim to find projects within the business that help with this. For example, if a Customer Happiness Wonderperson II is looking to be promoted to a level III, amongst other things we need to find a 'high impact project' for them to lead, or a junior team member for them to mentor and train.

The career ladder has been working really well for us so far.

Tuesday, October 9, 2012

Prime Minister's Forum on the Digital Economy - Wrapup

On Friday I attended the Prime Minister's Forum on the Digital Economy along with 40 other people involved in the online space.

The event kicked off with an introduction from the Prime Minister, then Google Australia head Nick Leeder painted a picture of how Australia should be aiming to build a Silicon Beach, I love the ambition of this and it ties in nicely with the views of Paul Graham that I blogged about previously. Nick raised 3 key issues for Australian to develop a Silicon Beach:

  • Education - we need more people studying software engineering at University
  • Support for the Venture Capital industry - so Australian startups can raise capital
  • A change in our culture to encourage risk taking and entrepreneurship.

It was great to see Nick pushing 2 of the major issues I wanted to see the group cover.

It was fantastic to see the Prime Minister introduce one of our successful online retailers Jane Cay, founder of Birdsnest to speak next and share her story. Birdsnest are a women's fashion retailer based in the country town of Cooma in the ACT. Out of a town of 8000, Birdsnest employ 70 people!

Tony Faure of Pollenizer spoke next and among other things raised the ESOP issues which was fantastic.

Shortly after this I gave a brief overview of Shoes of Prey and raised my 3 key points using our experiences at Shoes of Prey to explain:

  • the challenges of hiring software engineers and how our education system needs to encourage more people to study this degree;
  • the challenges of raising funding and how the Australian VC industry needs support; and
  • how setting up an ESOP is challenging due to the taxation issues around this.

I would loved to have raised all 7 points but I didn't want to hog the floor early on and dilute the message of these 3 largest points. Fortunately I had the opportunity to raise one of the other points shortly after...

Ahmed Fahour from Australia Post talked about the changes and innovations that Australia's oldest company is making to adapt to the digital economy (Australia Post is 203 years old!) I followed up with a question for Ahmed on what we as an industry can do to help Australia Post bring their international shipping costs down as these costs are a challenge for Australian retailers wanting to export overseas. Ahmed mentioned that they face issues on price due to the Universal Postal Union structure but that they're launching a new tracked international shipping product for the Australian domestic shipping price plus $6! I spoke with Ahmed in the next break and the product is called International Track and Trace. At the moment it's only available to the US but Australia Post are working on making this product available to our 5 largest import/export partners.

Scott Farquhar of Atlassian brought up the excellent issue of Australian businesses off-shoring some jobs and how we need to be accepting, both politically and culturally of this happening if we want to be successful as a nation in the digital space. This is a key part of our business at Shoes of Prey, our business wouldn't be possible if we didn't manufacture our shoes in China and despite doing this, we're a net exporter.

Possibly my favorite comment of the day came from Jane den Hollander, Vice Chancellor of Deakin University who during a discussion about telecommuting and the digital workplace made the good point that much of life is about meeting people. While the digital economy can make working and studying more efficient, we'll never and don't want to eliminate the "sex, drugs and rock 'n roll" aspect of actually meeting, working and learning from people in person.

My favorite quote for the day came from Rob Nixon of Nicko's Kitchen who when talking about social media said, "Treat your customers on social media like you would your girlfriend; don't argue with them, be nice to them."

Some of the later commenters mentioned the positivity that came out of the session and I couldn't agree more. The fact the event was organised in the first place is a great start for Australia's digital economy. The ideas and discussion were all excellent. Everyone from startups to Google to Australia Post to the Commonwealth Bank, Universities and research bodies like the CSIRO are all adapting to and embracing the digital economy and the Australian Government is keen to hear what they can do to help.

That said, the most critical step in an event like this is what follows. The Prime Minister summed up her 4 key takeaways as:

  • Education - we need more people studying software engineering. The PM said she would follow up with the Education Minister Senator Chris Evans and organise a follow up meeting with some attendees of the event to work through ways to encourage more people to study software engineering.
  • Telework - the government has a goal of 12% of the population working from home 1 day per week by 2012. This isn't a major issue for us and while in the fast paced life of a startup there are significant benefits to working in the same physical space as your colleagues, we're not far off achieving this at Shoes of Prey already and it forms part of our culture.
  • Cloud Computing - there was a lot of discussion around encouraging larger organisations and SMEs across the country to adopt cloud computing. There are significant productivity benefits to doing this but I don't think this is necessarily something the government needs to encourage beyond building the NBN. Cloud computing providers like Google are doing a great job of promoting their products in this space. It's also not a major issue for us as a significant part of our operations are already in the cloud.
  • Expanding the scope of the Cyber White Paper to include a range of the other issues raised throughout the day. Theoretically this is where my other 6 points could fall.

It was a little disappointing that more of my 7 points didn't make the Prime Minister's top 4, but the points she took away were all ones that were discussed a lot - large organisations like Australia Post, the Commonwealth Bank and others have a very different set of issues to startups like ours. And what was good was the PM took away the big one which is education. I'll submit the other points to the Cyber White Paper which ties in with her final take away.

On a personal note to be asked to contribute to a discussion like this on government policy in an industry I'm so passionate about was a career highlight. Not to mention meeting the Prime Minister who prior to the event had been on our website designing shoes! She told me that being on her feet all day she prefers a 2inch square heel as a nice combination between style and comfort.

Thursday, October 4, 2012

Prime Minister's Forum on the Digital Economy - Talking Points

Following on from my post last week about the Prime Minister's Forum on the Digital Economy below is the list of points I'm planning to raise. Thanks to Kate Morris, Scott Farquhar (who is also attending), Peter Renshaw and an anonymous commenter for adding to these ideas.

1. Employee Share Option Plans (ESOP)
This excellent opinion piece in the SMH by Big Commerce co-founders Eddie Machaalani and Mitchell Harper describes the issues well.

ESOPs are hugely valuable in attracting, retaining and motivating top talent allowing a startup like Shoes of Prey to directly reward our team should we successfully hit our targets.

The main issue is that under a standard ESOP in Australia the ATO treats grants of shares or options under an ESOP as compensation for tax purposes, with tax payable on the value of the grant in the year the grant is made. For a startup like Shoes of Prey this means employees would need to pay tax when we grant them shares or options under the ESOP, even though these shares may never vest if the employee leaves the company, or the shares may end up being worthless if we're not successful. This is not how shares or options under an ESOP are treated in other countries like the US, and it makes it difficult for us to retain top talent in Australia.

2. Education - More People Studying Software Engineering
Hiring top software engineering talent in Australia is hard, there just aren't enough people studying software engineering degrees. We need better software engineering programs in schools to encourage more people to study this degree, then we need a lot more places at Universities for software engineers. As a country, we're investing a huge amount of money in the National Broadband Network, but without more software engineering graduates we're going to struggle to take full advantage of the network when it's built.

3. Support for the Venture Capital Industry
Raising capital as a startup in Australia is hard. We have a reasonable angel investment community, and US investors are willing to invest in larger Australian startups with funding rounds of $20m plus, but raising an amount of money between the $1m and $20m mark is much harder to do as an Australian based startup than a US or European startup. This is because we don't have a strong venture capital industry here in Australia. The Australian Government has provided good support for the venture capital industry through the Innovation Investment Fund, however my understanding is this program is unfortunately coming to an end.

An alternative approach to funding startups and encouraging the establishment of a Silicon Valley in Australia is the approach proposed by Paul Graham in this article.

  • Fund startups at the time they make their permanent roots in a location, and will be able to grow large enough to be able to received further funding from international VCs without needing to move. A small Series A round is the minimum here, Paul suggests ~$1m.
  • Bring in 1000 startups at $1m each, a cost of $1b.
  • This might take around 5 years.
  • Once you had 1000 startups in town, international VCs would start opening local offices and could provide additional funding without the startups needing to move.
  • How do you pick the startups? Make a list of the most eminent Silicon Valley angels and generate a list of all the startups they'd invested in. Offer these companies $1m each to move to Australia.
  • Test the theory with 30 startups first and see what happens after 1 year.
  • Pick a city that resembles San Francisco - good weather, central downtown hub, good Universities, fun vibe = Sydney!

Paul says, and I think I agree that the political will to do something like this will be small, so I'll see how the conversation is going and may or may not raise Paul Graham's idea.

4. Payment Innovation - Multi-Currency
PayPal is fantastic and we use them for our multi-currency credit card processing so we can accept payments from customers in Japan in Japanese Yen, payments from UK customers in Pounds etc. This is critical for Australian exporters in the digital space. PayPal's solution isn't perfect, and it's quite expensive but there are essentially very few other options for Australian businesses to use. It's possible to do through NAB but as I've blogged about previously it's abhorrently difficult to set up. We need innovation in the payments space.

5. International Shipping
Sending parcels from Australia is ridiculously expensive. Under the Universal Postal Union structure, Australia Post are restricted in what they can charge to forward mail sent from overseas to Australia. Australia Post apparently make a loss on this part of their business. Australia Post CEO Ahmed Fahour (who is also attending the event) has said, "The only way we can minimise our losses is if the domestic price goes up." "The more Australian retailers go online, the happier we are, because we actually make a buck on that."

I can appreciate the issues Australia Post are facing, however the problem for online retailers in Australia is this means the rates to export products overseas make exporting unprofitable for many businesses. A 2kg parcel shipped to the United States costs $81.20 for a 2-4 day service or $117.74 for a 2 day service with Australia Post. This is 4 times what we were originally paying prior to volume discounts for a 2 day service from China for a 2kg parcel.

6. High Australian Dollar
The Australian dollar is high as a result of the resources boom. The high dollar is choking international competitiveness in the digital economy and post boom, Australia is going to be underweight in these industries of the future. Redistributing revenue gained from the resources boom into the digital economy would help alleviate this.

7. ATO Recognition of Revenue for Subscription Software
Accrual accounting principles require that subscription revenue is realised over the period of time the service is being delivered. The ATO want to tax subscription revenue up front at the point of payment. This is a massive issues for subscription revenue businesses like Atlassian and other cloud software services, a rapidly growing sector within the digital economy. This is a major issue for these businesses and the taxation issues around this need to be rectified otherwise we'll lose some of these businesses overseas.

The forum will be webcast live at pm.gov.au/digitalforum. Press release with additional details here.

Wednesday, October 3, 2012

Cameron Herold - Hiring and People Management

I recently attended a day and a half seminar by Cameron Herold, a successful entrepreneur and former COO of 1800-Got-Junk? which grew from $2m to $106m in annual revenue during Cameron's time as COO. Cameron covered a whole range of different areas of entrepreneurial life. In particular, I took a lot of ideas away on hiring and retaining top people and thought I'd share my notes on this blog:

Hiring process -
1. Need to define exactly what you're looking for, be very specific about it.
2. Craft the job description so that it's very specific about what you're looking for.
3. Define interview questions that help you identify whether the candidate has the specific skills you're looking for. Find other creative ways to do this Eg. look at the cleanliness of their car to understand attention to detail.
4. Statements - when candidates arrive in your office it needs to make a statement aligning with your vision. "I can feel the energy". "I understand what this place is about".
5. You need to be poaching people - it's the best way to find the best people.
6. Conduct group interviews for cultural fit. Group interviews are a great way to see how people interact with others. Suggested group interview questions - pick someone else at the table and sell me on hiring them. (You want them to pick the best person and sell well. You don't want the political person selecting the weakest candidate). How much money do you need to make this year, how much money do you want to make 3 years out?

Interviewing

  • Group interviews - cultural fit comes through
  • Ask 'Why' a lot
  • Focus on the gaps between jobs
  • Ask questions that get you names of people they've worked with
  • Ask for contact details to conduct reference checks on the names they've mentioned in interviews
  • When conducting reference checks - keep pushing to get the dirt on those you're reference checking

Job applications:
Auto response -
1. Please read this painted picture (more on this in a later blog post)
2. Please read this article about us in the media
3. If we're a company you want to work with hit reply with "Interview Me" in the subject line and we'll get you in a for a group interview. This process helps cull people who don't like your vision or who can't follow a simple instruction to reply to this email.

Need ~200 resumes per job. Develop a process for getting these.

When writing a job description, write their scorecard a few years out. Bring that back to today into a job description.
Scorecard = what they're going to achieve. Ideally hire someone who's done that before.

Low Results, Low Values = off the bus
High Results, High Values = handcuff them to the bus. This will be different for everyone - simply find out what they want and give it to them.
Low Results, High Values = move them into the right seat
High Results, Low Values = off the bus

Top 3 traits in Shoes of Prey team members:

  • Happy and enjoy making other people happy
  • Tenacity/Scrappy in achieving their goals
  • Collaborative
Ensure we're interviewing correctly to find these people.