Start Up Blog

Investing in staff

Posted in entrepreneurship by Steve Sammartino on October 13, 2011

I was recently speaking with someone about training staff, and the benefits of really investing in our people. To which he replied:

‘What if I train them and they leave?’

I said:
‘What if you don’t, and they stay?’

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Open pay display

Posted in entrepreneurship by Steve Sammartino on August 2, 2011

I think companies should have everyone’s pay on display. A publicly available intranet site in alphabetical order with every employees name, salary and benefits next to it. Ok, so this is a bit of a shift from the secret salary world we currently live in. It might even cause a little bit of a distraction in the short term. But one thing is for sure, it will move our society to a far more accountable culture than we currently have.

Let’s consider for a moment the type of behaviour this is likely stimulate:

  • “I work harder than Joey, and he earns $20,000 more!”
  • “I want a pay rise”
  • “Holy shit, I better start working harder, I’ve been found out.”
  • “I wont get a pay rise in years”
  • “She doesn’t deserve that”
  • “Why do sales people earn so much?”
  • “Our company is a rip off, they don’t pay well”
  • “I can’t believe how little Mary earns, she’s a gun”
  • “I’m gonna work my ass off to get that job – I never knew I could earn that much!”

I really believe the initial chaos would lead to a better and more transparent workplace. One where everyone understands their role, impact and the investment the company makes in its people.

In my next startup, this will be policy number one. Total transparency in all financial documents, including salaries.

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What drives people

Posted in entrepreneurship by Steve Sammartino on January 3, 2011

I had an interesting discussion with a child psychologist yesterday. He was telling me that one theory says there are three main motivators for all human behaviour. I am sure there are a zillion counter theories, but I really think this can be useful for anyone working in the ‘influence’ arena.

The three motivators are based around the desire for:

Power

Inclusion

Achievement

The theory states that 2 of the 3 will be very important to us, while 1 of them will be very low on impacting our behaviour. It also says that this operates at a very deep subconscious level. Without knowing too much about, I already think I could pick what motivates many people I deal with in business. It might also be worth thinking about next time you’re negotiating something or working on a project with others.

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Why Masterchef works

Posted in entrepreneurship by Steve Sammartino on July 26, 2010

Masterchef has truly been a phenomenon in Australia over the past 2 seasons. A ratings boon which is rare in our fragmented media environment. In fact it was watched by an average 3.54 million, up from 3.29 million last year. This makes it the most watched non sporting event in Australian history. It’s not hard to find a Masterchef fan, but not being one I was curious what all the fuss was about so I endured a few episodes. I didn’t catch the bug and so asked some colleagues why they believe (from an advertising, marketing and media perspective) it did so well. The best description I got was from Paul Gardner who summarised it as follows:

He said there has been three distinct phases in the evolution of reality TV.

1. Hoons & Havoc. Lock up a group of  highly charged youths in a house filled with alcohol and sexualy energy and see what happens. Think Big Brother.
2. The Challenge. Take a group of normal people outside of their comfort zone to compete in a Spartan like fashion.  See what behaviour humans will stoop to in order to win and prove superiority. An observation of social interaction at a draconian level. Think Survivor.
3. Denied Talent. Take a group of people who have some genuine flair for something, who have not been given the chance (for whatever reason) to display their talent. Give the competitors potential for a new start, to chance become entrepreneurs. Make the show inclusive, yet competitive. Add a sense of collaboration and educational good for all. Build a result into the show which isn’t purely financial but provides recognition and a new direction. Overall, make it represent the values of a modern civilised society. This is what Masterchef has done.


The thing that’s really impressive about Masterchef from a marketing perspective is that they took the well worn genre of ‘cooking’ understood the important nuances of human behaviour and made it something much bigger than anyone ever expected.

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Snails

Posted in entrepreneurship by Steve Sammartino on July 20, 2010

In business some people are snails. They move slow. They only slide in and out when the conditions are right (it’s wet). They leave a trail of slime behind them. And they are in constant danger of being crushed but others who just didn’t see them. They’re inconsequential. They’re existence seems superfluous even though they must have some kind position within the economic (food) chain.

Snails can’t live in startup land. They’re too dependent on the right conditions, even though Snails can be found in a very wide range of environments, both the human kind (human = government, private industry and SME’s) and the slug kind (slug = ditches, deserts and the abyssal depths of the sea).

Snails don’t build anything or change their enviornment. Instead they hide in the depths of some rich natural environments. Take a small portion of food and hope not to get crushed. There is a bit of snail in all of us and it’s something we must decide to avoid before we start anything important.

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The truth about digital offshoring

Posted in entrepreneurship by Steve Sammartino on June 13, 2010

BRIC nations (Brazil, Russia, India and China) are the buzz word in business for good reason. In the good news for us small entrepreneurs is that access is no longer limited big players. The internet has made it possible to have a global work force from launch date, and the same cost advantages that multinationals have had since they started exporting labour to China and other parts of Asia since the 1960’s. Anyone can do it now.

Before you worry about the ethics of ‘off shoring’ there’s some stuff we should know. Exporting labour overseas is ethically sound. It is beneficial both to the recipients and the providers of such work (us). The average computer programmer earns around $1000 a month in India. In the USA and Australia it’s more like $7000 a month. Unethical? Not really. The $1000 a month versus the average in India of $85 gives new information workers in India and very high standard of living.

When we inject money into developing economies we are increasing the living standards not just for our employees, but for their economy in general. In addition we have the option to pay them above market rates to create strong loyalty. We have the option  treat our people well and create important cultural exchanges and relationships.

Other peoples time is what we must leverage for startup success. A simple business fact time immemorial. Only now we have both currency advantage and access. The issue of moving jobs overseas is a crock. We live in a global age, an internet economy. We all buy goods everyday from overseas. Geographical barriers simply wont exist shortly. So we should just get on board. Protectionist attitudes are outdated. No one is sending kids down mines with digital offshoring. If local people are getting put out of jobs, then they’ve been earning too much for what they’ve been doing anyway. Their outplacement is inevitable.

Startup Blog says:

• Outsourcing is available to everyone, not just powerful companies
• Off shoring improves living standards
• Off shoring is ethical and important culturally
• We must embrace it, or get left behind. There is no choice.

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It’s our audience, not a target

Posted in entrepreneurship by Steve Sammartino on June 8, 2010

There’s quite a few bad words used in business and marketing. Words which quantify, extract and segment. They dehumanise business. I’d like to see them removed from our vernacular. Here’s two examples worth sharing.

Target & Consumer. I prefer Audience and People and here’s why:

A Target is something we aim for, shoot at, maybe even kill. An Audience is something we try to impress. An audience gives us a chance to prove our worth, they invest their time in us and we must respect it by trying to over deliver to their expectations. In the hope that, they throw flowers on the stage, cheer and ask for an encore. But we enter the stage knowing we may get rotten tomatoes thrown at us, if that’s what we deserve. The onus is on us.

A Consumer is someone who buys stuff. Their primary purpose is to devour whatever we provide. They are faceless, nameless and irrelevant. We want as many of them as possible to fulfill our financial needs. A Person however, is someone we know. A person has emotions, ambitions and meaning in their life. They have opinions which we must value, and a life which we need to enhance. A person is someone we hope to relate to on a human level. A consumer is machine like and undervalued.

The best startups and brands, know that they need to perform for their audience. They know that audiences are made up of people.

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Economic irrationalist

Posted in entrepreneurship by Steve Sammartino on April 16, 2010

Lately I’ve been making a few decisions which are economically irrational. Making decisions which are, on the face of it, financially inept.

For example, I starting to feel a sense of loyalty to my chief technology officer for rentoid.com

He’s not the cheapest and he’s not the best. Probably somewhere in the middle for both. I could probably get someone cheaper with similar skills, or better for the same price. But I don’t. In fact I tell him that I’m loyal to him. A large part of why I want  to succeed so that he can succeed also, to share it with him. Even though he has not risked the capital, or the time that I have on the project.

Why would I act this way. Well I like working with him. He’s a nice guy, and sometimes that’s enough.

I guess you could call me an Economic Irrrationalist. And it just feels right.

Why scoreboards matter

Posted in entrepreneurship by Steve Sammartino on February 20, 2010

Humans are compelled to count. We count everything. Days, weeks, months, years, birthdays, money in the bank, salary levels, years of experience. It’s part of the human condition, maybe it helped us evolve to a civilised existence .

As startup entrepreneurs we need to let our people count something. Whether it’s the savings they made or they friends they have, there needs to be a way for them to keep track. So our people know they have made progress. Commerce is an anthropological game of football. So we must keep score. But it must go beyond the corporate scoreboard of profit, share price, turnover, number of employees… it has to be an audience focused score. Like followers on twitter. It has to be about them, not us, it’s how humans roll.

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People & Compound Damage

Posted in entrepreneurship by Steve Sammartino on March 27, 2009

No doubt your new start up will face issues. Many of them will be people related. Some will be things simply not getting done or not working once you press the on switch. If issues arise and remain unresolved within 24 hours you will start to suffer Compound Damage. This is particularly the case with suppliers and staff. All things in life compound, it is just natures way.  Consider this with all problems and general stuff ups.

If you ignore them they will go away, along with your business.

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