The Scarcest Resource at Startups is Management Bandwidth

Posted on Apr 28, 2012 | 47 comments


When you work inside a startup with lots of clever and motivated staff you’re never short of good ideas that you can implement.

It’s tempting to take on new projects, new features, new geographies, new speaking opportunities, whatever. Each one incrementally sounds like a good idea, yet collectively they end up punishing undisciplined teams. I like to counsel that the best teams are often defined by what they choose not to do.

Let me explain.

As a VC I regularly meet with companies and listen to their plans. It’s a very common occurrence that a young startup with sub 20 staff and sub $2m in financing is racing around doing too many things. This level of complexity always worries me. A significant number of the companies I meet with get some form of feedback from me that:

“I’m a bit worried that you’re doing too many THINGS. You run the risk of being a mile wide and an inch deep. It’s hard enough to do X really well and succeed. I’m not sure how you do all these other things and yet I think they may end up being a distraction to X.”

I already know your response. Trust me. I hear it every week

“Yeah, but I’m just going to execute this [channel sales deal, international license of my product, new industry, new operating system, biz dev deal] and then it will pretty much run itself.”

It never does. That channel deal that you thought would take no times ends up burning scarce calories. The 3rd-party tries to sell your software – they just need your help with tech assistance to close the deal. They just need you to update your marketing materials. They got your last version working but since your latest release they couldn’t get it to work. That test you did on launching a RIM version of your product – it was only beta – now has 20 users who need a patch because it’s not working properly.

Every extra set of features that you added that served one narrow use case end up being features you need to support in future releases adding complexity to future development, usability testing, regression testing, etc.

Every team I fund comes across as laser focused on their core mission.

My advice?

I always tell teams I meet with, “The scarcest resource in your company is management bandwidth. Spend it wisely.”

Every company is built by a team and every team member matters. But as you know, a few key people in any business have disproportionate impact on the company’s ultimate success.  And nobody is more important in this regard than senior management. These people need need to be hyper focused on those things that matter the most to the company’s success. It’s why I don’t invest in Conference Ho’s.

Examples from discussions I’ve had this month that might resonate with your internal debates about how to prioritize

  • We are giving a version of our product to a team in Europe who will start selling our product internationally
  • We are signing up a channel partner to sell our product since we haven’t scaled our internal telesales team yet [yes, we know that they don’t have experience selling IT, but they have customer relationships]
  • We’re going to put a guy on the ground in the UK to address early leads we’re getting from ad agencies there [true, we haven’t thought about employment laws, taxation, currency management, etc.]
  • I know our product seems complex but we felt we needed to test lots of features to be sure we knew what would resonate with users … or … we aren’t committed to features x, y, z yet but we know our competitors are planning to so we wanted to be first to market
  • We need to hire a team in financial services now to address the needs of that industry [yeah, I know we don’t yet have big customers there. ok, I know our product isn’t yet verticalized. still, we need to start now or we’ll be behind.]

And so on. Trust me – each additional complexity you add before you’re ready decreases your probability of being truly excellent at the things you want to do extraordinarily well.

Instagram didn’t rush to Android. They also didn’t do video. They were truly excellent at what they did do.

What do you want to excel at? How will today’s “toe in the water” initiatives distract you or take your management’s time or attention off of your core business? How likely is your, “won’t take too much time” initiative to come back and bite you in the butt?

Beware. The best teams are hyper focused.

Image courtesy of Fotolia

** A note to readers. Sorry if you received an email with a draft version of this post. I had some problems with my hosting company. They were testing out what the problem was and accidentally hit publish on a draft post.

  • Martin S.

    I think proper documentation is still a widely underused skill. After every project I finish, I go through all the steps that were elementary to its success and try to find out what went exactly right, what went wrong, and what could be simplified/streamlined. I try to use as many objective indicators as possible, so I can easily compare whether my launching a direct mail campaign went better than the previous media buys or vice-versa.

    I’d imagine that this would become only more important if you’re launching a startup and don’t want to exit right after customer development. Considering the abundance of ideas, how will you judge whether you’re both efficient and effective with the limited resources you have when you can’t even keep track of all the things your team is doing, or rather, how they’re doing them? Once a department succumbs to chaos due to a lack of accountability, it’s pretty hard (and expensive) to get it back to normal, so I’d rather get some scientific management in there right from the start, even though it’s far from the most exciting thing to do.

    (I’m thinking about doing an ERP startup, btw. Would anyone have guessed?)

  • Raad Mobrem

    Good article. I think of running a company to be similar to playing a game of golf. If you focus on only shooting par, you will screw up and mess up your mentality for the whole round, ultimately leading to a crappy round.

    If you have a long term view of shooting par and then really focus on each shot as a separate goal, one at a time, you most likely will do really well…even shoot under par.

    Focusing on the parts to create the sum is key.

    That’s what we try to do at Lettuceapps.com

  • tedstockwell

    Focus and self-discipline are key, as with the Instagram example.

    When managers have excess capacity they’ll start kicking off new initiatives, overcommitting the organization, and reshuffling plans.  From an engineer’s perspective, it can be good when management is too busy to go wandering off.

  • http://www.akshaymishra.com/ Akshay Mishra

    You seriously need to read the Valve Employee Handbook.

  • http://twitter.com/leoalmighty Leo Chen

    Simple advice needs to be reiterated. Thanks Mark. Your points are spot on and even more true when you’re a 2-3 person team in an accelerator. 

    We’re in the current batch at 500Startups now and there’re numerous mentors to talk to, offers for introductions, speaker session, workshops etc. Prior to joining 500, I jumped on opportunities to meet with relevant people and advisors because it was fairly infrequent and I wanted to get out and talk to people. As an unproven early stage company, we tend to value “important” people’s time & advice more than our own; changing that mindset makes a huge difference. 

    Now I’m getting better at being hyper selective, often declining intros and skipping talks. Just yesterday, I had a long discussion with my team to cut out 99% of the “maybe we could do ____” ideas and just focus on what we should do now and how good we can be at solving 1 problem before dabbling into other areas.

    Looking forward to catching up again in the near future. I’d love to show you our app when it’s in beta.

  • http://www.larry.com/ LE

    I really like this advice.

    But with respect to this:

    Beware. The best teams are hyper focused.

    ..first the devil is in the details as always and isn’t it possible that you will become focused and overlook a turn in the road you should be taking that might result it something that achieves greater success?

    My feeling is that it’s impossible to predict what optional activity will turn into something and what won’t.  So what I normally do is simply allocate a arbitrary amount of my time (15%) to what I call “pure research” and things without definite expected gains.  And makeup for it by working 7 days usually.This is one of the reasons I don’t go to any conferences. The time I spend traveling, booking travel and wasting talking to people I don’t care to talk to I could spend in another thing (at the office) that I believe will turn into some future gain.

  • http://lexspot.com/ Chris G. Shaw

    I really appreciate this post, Mark. Something you should add is that sometimes you have to ignore “important people.” 

    What does that mean?It’s easy to listen to every VC, angel, CEO, advisor—whomever—and feel like you have to incorporate their thoughts. In the last couple months, those “important people” have given us dozens of product features, sales channel agreements, new hires, etc. that we “have to do.”What I’m flabbergasted by is how little many of those people, truly smart people, know about our business before handing out this “necessary” advice. I don’t want to sound ungrateful, as we’ve had some amazing advice as well, but trying to focus can be really difficult when the peanut gallery gets noisy. One method we like to use at LexSpot to prioritize product features is Adam Nash’s “bucket theory.” It helps us focus on what’s truly important. We’ve got a board of 50+ features we could build and we try to prioritize based on true necessity or strategy and focus on executing on at a time. His post on the bucket theory is at http://blog.adamnash.com/2009/07/22/guide-to-product-planning-three-feature-buckets/. 

  • http://www.pivotpointsearch.com/ Scott Thompson

     Excellent. Coincidentally I felt compelled to do a short take on the topic of “focus” myself this week. Great minds and all that?

  • Connor Braa

    Valve makes it’s system work for two reasons. First, it started small, and so a small group of people working on whatever they wanted produced games that weren’t large scope projects. As valve grew, the number of features in their games grew (think the extensibility of the source engine, or steam) and the number of ip’s they worked on grew (think portal, team fortress, day of defeat.)

    Now that they’re more than just a gaming company, steam is kicking huge amounts of ass, and they have a fine tuned system based on hiring the right people, they’re set in terms of cash flow, and can afford to be 200 brilliant people working on whatever they’re passionate about. Startups are in such a hostile and moneyless environment that only the best can afford to be 50-100 doing 1 thing that they’re passionate about. 

    Also Valve is known for being absurdly late (Valve time) on their releases. startups can rarely afford to be very late.

  • http://maraby.org/ Matt Todd

    You leave a lot of room for interpretation of what you mean by “management bandwidth.” Could you try to define that a little more explicitly?

    Coming from an organization that does not have traditional “upper management” or any explicit management roles, responsibility is distributed amongst all our members. I think I understand what you’re saying and how to apply it in such an environment but clarifying your meaning would help confim and illuminate that point specifically.

  • http://bothsidesofthetable.com msuster

    “I think proper documentation is still a widely underused skill” … agreed. maintenance becomes unmanageable without it.

  • http://bothsidesofthetable.com msuster

    Yes, management can produce many distractions when they don’t understand how much it negatively impacts the organization.

  • http://bothsidesofthetable.com msuster

    Look forward to learning more about your progress. re: incubators – yeah, you sure can get “mentor whiplash”

  • http://bothsidesofthetable.com msuster

    Yeah, I agree with some time allocation to “future projects” but as management it’s important not to let your team get distracted with non core activities (such as internationalization). That’s all.

  • http://bothsidesofthetable.com msuster

    I agree that you have to be careful about talking too much advice or too many intros. Can be a distraction.

  • http://bothsidesofthetable.com msuster

    Simply this … let’s say you have a 15-person team. You have divided tasks: programers are coding, customer support is responding to emails, sales is trying to win new business, etc. 

    And you usually have 1-4 people who are tasked with “running the company” which usually means setting strategy, raising capital, dealing with investors, etc. These people have limited time & attention. When it gets spread on things that aren’t “core” the whole company can drift.

  • Cecilia de Soto

    Thank you for those so clear concepts. 
    I’ll hardly try. Any help for improving focus?

  • http://about.me/mikeschinkel MikeSchinkel

    Damn Mark, you nailed it again. 

    I was a mentor last weekend at Atlanta StartupWeekend, and each team I counseled I explained the same thing to as your post here explains. But of course you explain it better than I ever could.

  • William Pietri

    Great post, Mark.

    At our startup, we manage everything with a big wall of cards (top photo, right side):

    http://needfeed.com/about/working

    Out of all of those cards, we are never working on more than 3 at once. You could look at the main section of that board as our long-term plan. But honestly, plans at a startup are volatile enough that it’s not quite true. The most important function of the backlog is as a repository for all the great ideas that we are definitely not doing right now.

    When some new, brilliant idea comes up, the board makes it easy to say, “Oh, well it’s not as important as that. Or that. Or that.” But you write it on a card anyhow and put up because that makes it easy to let go of the idea and return to the very most important things at the top.

  • http://www.underflow.ca/ Jacob Groundwater

    I am going to point people to this post whenever they insist on doing “everything under the sun”. I find that behaviour comes from the thinking “my product must do everything from the start, otherwise nobody will use it”, or a similar thinking that being “less than perfect” so early will only generate bad word of mouth.

  • https://twitter.com/#!/chrisfharvey Chris F. Harvey

    Talented people love their pet ideas.  It takes real leadership finesse to convince people that being “Dr. No” is for the good of the team.  

  • http://www.bluecoastrecords.com/ Cookie Marenco

    Great post, Mark!  The phrase, “cost of the opportunity” comes to mind.  Learning to ask the right questions early helps identify whether the cost of the opportunity is too high.  Assumptions can kill you. 

    “No” is a one of the toughest words a manager has to say.  Exercising the “no” muscle without regrets isn’t something that comes naturally to a lot of us.  But, it can be learned.  I made a lot of mistakes along the way learning “no”.

    I’m probably off topic, but you’ve reminded me that great teams are focused…  everyone on the team has to know where the ball is or you lose the game.

  • http://twitter.com/peteripowow Peter Tippett

    This is all about experience in dealing with too much and doing the key job of FOCUS. One thing I have alway done is the top 5 things to do and top 5 things not to do. Simple, but effective. I also find simple core values makes the dealing with distractions so much simpler to manage and have seen many companies I have consulted to over the years in not having this, so they wasted much time in making decisions before we set these core values and got focus which trimmed what didn’t fit these values and they gave great turn arounds.

    As an example, for myself, the last week was to work outside the office for a week working on strategy only and trust the team to run everything. This allowed me to sit back and think so I could do a full analysis of where we are at and what is happening in the market as we are entering hockey stick mode. This was done so I wasn’t distracted and allows us to make sure we have clear focus.

    Simple reason for do this is I have learnt that to slow down some times will allow you to go faster long term.

    One extra item is how amazing that simple rules that have been repeated many times over such a long time work so well and this post reflects some of them so well.

  • Zoey

    My business partner and I were having this very discussion about our competitors yesterday. We’re coming into this space largely because they’re failing to nail down this little niche market. We believe the primary reason they’ve failed is that they’re involved in too many things and not focusing. Our business is very hyper-local, and our competitors both decided to go out and join every group in town and volunteer and do everything under the sun in the name of “networking” — well, why not just do the networking and skip all that other stuff that just makes you feel like a big fish in a small pond. If they focused on their businesses instead of their egos, they’d already have this space nailed down, and we wouldn’t even have considered coming into this.

  • http://www.nosnivelling.com/ daveschappell

    There are never such things as projects; they’re always programs.

  • Derek Pappas

    Lets differentiate between building the “minimum viable product” (jargon for laser sharp focusing on a lean and mean product) and people arguing about how how to do something. Developers want to do things their way. Discussing alternatives that are morally equivalent can waste a lot of time in a startup.  Dr. DoItThisWay is required in a startup, as well as Dr. No.  

  • Patrick Sullivan

    Radd, staying focused is not getting distracted with posts by VCs (even if they are pretty spot on). Didn’t they teach you anything at that incubator program? ;)

  • maricelam

    Mark, the amazing thing is how incredibly common this problem is and how difficult it’s to get founders to understand how self-destructive this is.  Thank you, but doubt there is an easy way to guide founders away from it, specially if they are new entrepreneurs.

  • Tim Kay

    Mark – great article – having worked in big corporates this is as applicable to them as it is startups.

  • GoranDuskic

    Staying laser focused is one of the most difficult tasks of a startup! It also reaps the best rewards!

  • http://pgiselfdirected.com/ John@PGISelfDirected

    I agree! Documentation is very underrated. Now where is the SUPER LIKE button when you need one?

  • Kumar Rangasamy

    Mark,

    Thanks for this post. I have been reading your blog for a few months and learning a lot. Particularly, this post, I can immediately relate to our situation.

    We are a small team focusing on building a B2B product primarily mobile and tablets as the medium and we are focusing on users of one country, that is, India. The main reason is..  we realized that we have to start small and focus on one place and market at a time, because that is what we can do now with the resources and also we believe that we can make a difference with what we are building.

    Clearly, our strength is on the technology side, that is, building the product. Now, when we want to go to market, we have all these various things that we have to work on. Finding resellers and-or Finding customers or whom to go with for marketing or forming a sales and marketing team in the company itself(ofcourse with what we can afford now), why not we focus on US market (require some changes in the product to support the US market demands), where we can acquire customers relatively in an easier way than in India. 

    So, yes, I get your point. What would be your advice for us in this situation, if  we want to explore the viability in other markets as well?

    Thanks
    KR

  • http://michaelmiello.com/ m&m

    I can totally see this being a question of give and take.  Really nice post.  I’m curious how you advise on small companies scaling sales opportunities.  What particular finance figures do you find indicative that tell a company “ok, it’s time to add something additional to our plate” 

  • Guest
  • http://twitter.com/jimishrshah Jimish Shah

    Great post Mark !! Thanks for Sharing.

  • Koby

    He shoot…he scores! right on the target – Focus, Focus, Focus!
    That doesn’t mean don’t think big…but be excellent at what you do, only then your value shines  

  • http://adamlieb.me/ Adam Lieb

    We just got done conducting some market research on our core usersbase. We found out that they are reasonably fragmented as far as what they consider to be the most important feature of our product. It is split pretty evenly between 4. I like to think we have a laser focus on those 4 features that our users really care about. If I pitched you, would you tell me I am fooling myself? 

  • http://twitter.com/DarrylAdie Darryl Adie

    I agree and I am a big advocate, however, product > documentation. Magento has proven that. They still don’t have documentation to talk of 3 years in and don’t plan on it until v2.0 in 2013. 

  • Raad Mobrem

    Haha, this is true. But keeping up to date on articles and what’s happening in the tech world is part of my job…thus I read.

  • http://fishingvlog.com/ Hörður

    Good reminder of being focused. I needed that, thansk :)

  • http://www.WhyNotJeeves.com/ Alagappan Muthu

    I was a bit surprised when I read one of your earlier blogs where you suggested to have an office administrator to take care of things once the startup was stable. I was a bit skeptic for I couldn’t see much use, for most of the things done by the Office Admin was done by my team and I without much strain. Still after your post I went ahead and gave it a shot. I admit it was one of the best suggestions I have got. My admin takes care of all the nitty gritty in the office, while my team has got all the time to focus on the task at hand.

    You guys might want to read this, it was very useful for me and it will give your management team more time to stay hyper-focused!

     http://www.bothsidesofthetable.com/2011/10/28/the-controversial-first-role-to-hire-after-your-a-round/

  • http://www.startupmanagement.org/ William Mougayar

    Hyper focus is definitely a key trait, but also hyper sensitive to potential course corrections. Hyper feedback antennas come to mind.

  • http://external-harddrivedeals.com/western-digital/my-book-live Carly

    This is the problem here. Firms are only going after profits and in the end screw up their ideals. For example, temple run was great on iOS. Seeing the popularity, they quickly sold themselves to laboring for an android version and where did it get them? The android version of the game virtually ruins the exciting aspect of the game. It lags and stops for no reason. I guess instagram did really do a good call here. They waited, they perfected and now using instagram on android feels nothing short of having it on iOS

  • http://financialdot.com/ Andy

    Super LIKE it! Management bandwidth and spend it wisely.

  • http://www.madinastore.com/ Aminuddinimam

    Mark Suster,
    I just found your web blogger friend, I tried to learn many things to improve the quality and optimization on my website, although I have long web, but I realized that the potential business berus (mainly sales of herbal products that I marketed it offline and online) was very large … Thanks for the article ..

  • Brian

    Completely, and undeniably true.  Good post.  I’ve found that to even have a chance at success I’ve had to scale back…and keep scaling back to focus.

  • http://twitter.com/BjornVeenstra Bjorn Veenstra

    Sounds familiar… all those opportunities and cool stuff to do!We actually killed some darlings and ended a new partnership based on a new idea… still we have to be alert every day.