A common cause of inefficiency at a startup is sloppy agreements.
Why are some startups less efficient or grow slower than others? A common reason that underpins each one is sloppy agreements. This manifests in a variety of ways
- People don’t show up on time
- Sales team doesn’t hit their quota
- Junior employees flying first class and draining the bank account
The result of all of this is lack of productivity and decrease morale. The start slow and it becomes a bad place to work.
Expectations vs. Agreements
Expectations and assumptions are inward thoughts. Everyone has them. The key is pulling out your inward expectation and converting that into a handshake is making an agreement. That needs to happen, over and over again.
To dig in deeper on this, watch this
Agreements as the Antidotes
The best way to make your startup work well is with tight agreements. This means:
- They are accurately and thoroughly defined and codified (the what)
- They are agreed upon by both sides (the handshake)
Both must happen.
This is for big tasks and small
Examples of Agreements
Hiring 2 new SDR’s. You (the CEO) agree with CRO to hire 2 more SDRs. You agree that you’ll interview 6-10 people who have at least 2 years of SDR experience, hire two at a price range of $50-80k and no equity. The hiring process will include a screening call, a functional interview and a test. After picking the best 2, you’ll build a 30-60-90 day plan to get them up to speed as fast as possible. After one month you’ll expect them to be booking 1 meeting a day.
Showing up to the exec team meeting by 9am with the pre-read materials read and prepared to discuss. This is conveyed to your team that the meeting will start at 9am and you shouldn’t be late.
Honoring Commitments
Being a responsible receiver of commitments means that you only accept commitments you think will be kept. This means you need to deal with any issues or concerns you have up front instead of waiting to find out if you’re right.
This also means you must recognize that a commitment someone makes to you is your commitment too. To honor a commitment means you’ve committed that you’re going to make it happen as well. It requires that your continued support the other person, like checking in with them when you have a concern about whether or not the commitment is going to be kept.
Punishing people for not keeping commitments is a victim mindset. Take responsibility for the handshake being two-sided and check-in with them to ensure it gets completed.
Adjusting an Agreement
The team relies on you to hit your agreements. But things change, assumptions aren’t correct, deals fall through. It’s your responsibility to tell your counterpart immediately if you don’t think you’ll hit your agreement.
If you don’t, you’ve broken the agreement. As a result, the rest of the company can’t adjust, productivity slips and morale sinks lower.
For example: You hit traffic and you’ll be late to the 9am exec team meeting. Call the team and alert them that you’ll be there at 9:10. Now they know to start without you and can plan accordingly.
What’s important is that you get a NEW commitment when an agreement needs changing or hasn’t been kept and you make sure this time there’s support in place so it will be kept this time.
Consequences
It is your responsibility to hold others accountable. You do this in 2 ways
- If someone breaks an agreement, you need to point this out to them immeidately. There’s no need for an apology on their end, just an acknowledgement that (a) they should make agreements they can keep and (b) they meet their agreements either by completing them or alert others if they need changes
- If someone repeatedly breaks agreements, there is only one option: this person can no longer be part of your company.
Some examples
- Managing Down. For each direct report you have, you should have a tight agreement on when your 1:1 is, what’s expected of them during that 1:1 and how it should be run. Coming out of that 1:1, you should have an greement of what’s expected of them over the next week. Codified, accurate, and agreed upon
- Managing Up. Whether its your boss the board of directors, it is your responsibility to know exactly the agreement between you and them of what your job is. Failure to do this will result in insecurity and often bad perceived performance (which leads to firings). This sounds obvious but it’s incredibly common.
- In your company, every employee should have an agreement of what success in their job should be over some time frame (6 month, 12 months 18 months). This is what is expected for them to accomplish during this time frame and, if done, you agree that they will have done an excellent job.
- Every time you decide to hire someone, there should be a tight agreement on who is responsible for that hire, what it is where’re looking for, the pay range, and the timeframe
- GTM. Top of funnel is crucial for any B2B business, is there a tight agreement with someone in your org of exactly how many new meetings booked are expected each week?
Common Pitfalls
- A lot of executives can’t keep track of all the commitments that have been made by them or to them. This is why it’s important to write them all down and be able to see them at all times.
- People have a tendency to say yes to any commitment that’s asked of them. Even though it’s hard to say no, remember the whole reason we make commitments is to help us reach our goals. You only want to make agreements that contribute to your company’s goals and vision. Remind people that not agreeing to a commitment is just as important as creating an agreement.
