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The Resilient Entrepreneur, Edition #50

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Hi there

I hope you had a great week!

Here are the topics in today's edition:

• 6 Reasons Military Guys Are The Employees Your Startup Needs
• Procurement's Original Mission Is Dead. Here's What's Replaced It
• Multiply Time Estimates by Pi, And Deadlines Start to Make Sense

Please reach out if you have comments, questions, or suggestions for articles!

Talk soon 👋
Tom

KickKerK

LEADERSHIP FOR RESILIENT ENTREPRENEURS

6 Reasons Military Guys Are The Employees Your Startup Needs

Military guys aren’t just a certain type of people. They combine a whole range of different skills and traits that are useful to have in any company.

At the Yonder office, military uniforms are a common sight. As the Founder & CEO, I am still an active reserve officer in the Swiss Armed Forces. One of my co-founders is an ex-military guy (we went through conscript training together some 25 years ago), one of our account managers is an ex-Tornado navigator from the Royal Air Force, and a couple of others are platoon leaders.

Working with those guys for many years, here is the simple truth: You don’t spot the military guys by their uniform but by their attitude.

That’s even the case for people who don’t have any connection to the military. Recently, I met a friend without any military experience. At some point, she suddenly said:

“I mean, you have a good leadership education from the military…”

Let’s see what this means by looking at some real-life examples, and hopefully convincing you that hiring military guys is a great idea.

1. They Work in Less-Than-Ideal Conditions

Some years ago, we moved from our small office into a much bigger one to accommodate our growing team. Naturally, for a young company, we managed the move ourselves — except for the truck driving our furniture from the old to the new office.

Because there was a lot of work with customer projects, we couldn’t just halt operations for a day because of an office move. So we organized it in groups: One group packed up the old office, one group took over the new office, and one group continued working on the customer projects.

I remember witnessing a situation in the old office when all the furniture was already packed up — except the small table in the kitchen next to the coffee maker. At that small table, two guys were bent over their laptops, working on a customer project.

Those were the military guys. They are used to working in less-than-ideal conditions and getting the job done irrespective of the comfort of their environment.

Next to those guys, at the coffee maker, another (non-military) guy was watching them, a cup of coffee in his hands. See the difference?

If you’re able to motivate and lead a pack of young people to go through involuntary hardship in military service, you can surely lead a team of colleagues through an unpleasant customer project, an internal reorganization, or a cost-cutting exercise.

2. They Are Hands-On

Later in the day, everybody in the old office switched locations, to continue working from the new office.

Working from the new office was only possible once the new furniture was assembled, so as soon as the two military guys described above arrived, they rolled up their sleeves, assembled chairs and desks, removed package garbage, and vacuumed the floor. Then they went back to working on the customer projects.

Believe it or not, some people were still wandering around the hard-working guys, just watching them and waiting for everything to be ready.

Military guys are hands-on. They do whatever is required for the mission to succeed. Even if you think they live in hierarchies, the reality is straightforward in the trenches: One for all, all for one. Everybody’s effort is required to succeed, just like in a startup.

3. They Always Put Their Mission First

Both business and the military have clear strategic missions: Businesses should make money, and armies should achieve victory.

Western armies work with a principle called mission command: Every leader needs to know his mission by heart, and always put it first. The mission is non-negotiable, but the ways to achieve it are.

Once internalized, the mission command philosophy often stays with a person for life. It is an integral part of military training and doesn’t magically disappear once a person transfers into civilian employment. This is where entrepreneurs can take advantage of hiring military guys: They do whatever it takes to achieve their mission.

Here is a real-life statement I heard in our company:

This was a few days before a major customer went live when the team was working day and night. One of our military guys skillfully synchronized all activities to make sure all go-live relevant tasks were finished on time.

4. They Survive In A Complex World

In today’s business environment, light and shadow are very close, and reality often changes much faster than your business plan.

Therefore, constant situation assessment is key in a complex world. While this is normal in the military, businesses (and the military administration!) still tend to stick to budget cycles and approved plans. When the situation in our company changes abruptly, I usually initiate situation assessment with the callout “new situation”. I learned this expression in the military, and I use it to inform everybody in the company that planning will start all over again, irrespective of the budget cycle, previous plans, or personal plans for the weekend.

In this way, we reorganized the entire company when COVID-19 struck and our pipeline in the aviation industry collapsed. My co-founders and I used the planning processes we knew from the military — instead of panicking, we used our judgment and a clear methodology to assess the new situation, develop options, decide on the new course of action, and communicate it to our team.

5. They Have a Plan, They Have Options

All officers in the Swiss Armed Forces are trained to always present at least two options for any given problem.

Options are presented with their advantages and disadvantages, as all options have both. Last but not least, a presentation of options is accompanied by a recommendation, for the commander to make a decision based on the judgment and expertise of the team who has worked out the options.

Whatever option is chosen becomes the intended plan — only for reality to alter your plans as it unfolds. That’s why you need contingency plans.

I have been living and breathing options and contingency plans for many years. What helps you in the military helps you as an entrepreneur — the reality will always be different from the original plan, no matter if you’re navigating your business through an unforeseen pandemic, you’re trying to close a financing round, or you are running into troubles with one of your co-founders.

6. They Stick Together, No Matter What

Change of scene. One sunny morning, we were having morning coffee in the office, chatting about work and non-work topics. It was still very early in the morning, and only three people were present at the office: Myself, and two of our colleagues with a military background.

Suddenly, one of the guys collapsed, lying on the floor and screaming in pain.

Calm as we learned it in the military, the other guy and I provided first aid and got the colleague evacuated. Once it was clear that he suffered from a kidney stone, we informed his wife and his superior.

The colleague was taken to a nearby hospital, where he had to spend the night. And it didn’t take long until another of our colleagues with a military background turned up at his hospital bed to look after his colleague.

Military guys stick together, no matter what.

Conclusion

Military guys aren’t just a certain type of people. They combine a whole range of different skills and traits that are useful to have in any company.

Even if you don’t have any military experience yourself like my friend I mentioned in the beginning of this article, I hope that I could convince you that hiring military guys is a great idea.

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LIFE HACKS FOR RESILIENT ENTREPRENEURS

Procurement's Original Mission Is Dead. Here's What's Replaced It

Procurement’s original mission was to prevent your incapable cousin from supplying sub-standard and overpriced goods and services to their company. How that has changed.

Those who read my articles regularly know I have a special love-hate relationship with everything procurement.

Love, because a prospect telling you that they will pass on your proposal to procurement and/or legal now means you have just moved down the sales funnel one more time, and a contract could eventually materialize.

I hate it because many times, I have been embattled in month-long discussions about petty clauses and requests from procurement and legal without any benefit for me.

Do you think I am exaggerating? I will give some real-life examples from my experience as the Founder & CEO of Yonder.

Affairs have to stay anonymous, so no names are given…

Before moving to real-life examples, why do I think I am credible to speak about procurement? Well, I know both sides of the game from my first-hand experience.

Before entering startup land, I worked for several large organizations in various business roles, so I had my fair share of interaction with procurement. Procurement had the authority to evaluate several providers for a certain product or service, and I confidently left the negotiation of favorable conditions for the company to them.

Procurement would then ask me for detailed information about my business case, realized savings, and IRRs. This information needed to be submitted in complicated spreadsheet templates. These templates seemed to change constantly, so copy-paste was not an option, and each new case required lengthy discussions with procurement. Once these discussions were through, waiting for the next procurement board meeting for formal clearing was next.

Even though I had to endure many administrative attacks from procurement during that time, I didn’t think too much about procurement inefficiencies, and what harm they could do to both suppliers and customers.

Enter startup land. Suddenly I was a supplier and not a customer anymore, getting to know procurement from a different side. Summarizing my 10 years of sales experience in startups serving enterprise customers, here is what procurements really do: Wasting time, and thereby destroying value for both the customer and the supplier.

They do it by morphing between two types of procurements, and by being vulnerable to five fallacies.

Type 1: Tender

This one is the easier case. Tenders are good things, as long as they are run professionally and fairly. However, more often than not, tenders are huge time-wasters: They aren’t launched for ages because formalities like budget ownership or sign-off authority need to be cleared before the formal tender process can start.

The formal tender process is then kicked off with the requirement phase, which usually takes lots of time for both business and procurement, as requirements are typically functional and non-functional. There is also the danger that requirements are getting too complex because too many stakeholders are involved. A classic case of overdetermination.

Both these problems can lead to delays or cancellations of a tender — which is bad for both the buyer and the supplier.

Type 2: Direct Procurement

This one is the uglier case. Whilst direct procurements might seem faster than a tender at first sight, more often than not they aren’t. The archetypal time waster is a mutation from Type 2 to Type 1, i.e. when a customer starts with a direct procurement and after months of discussion concludes that they need to tender before they can proceed.

If you think that this sounds silly, I can reassure you that it has happened to me on multiple occasions, with well-known enterprise clients all over the world.

Here is what such a case might look like:

Direct procurement always starts with a discussion with the business. At some point, the business passes you on to procurement. When I talk to procurement, I usually hear complaints that the business has not involved them early enough, and that work is super-difficult for them when the business has already requested and negotiated a proposal before involving procurement. From a supplier perspective, of course, I have to negotiate prices with business — I could never get them to pass our proposal to procurement by offering list prices!

Next, procurement asks functional questions about our solution (remember: the business hasn’t involved them early enough). I then try to give the same answers I gave to the business before, just in case procurement wants to test that I am consistent in my sales pitch. I don’t think it ever was a test; it’s just “for them to understand the project better”.

Now we’re finally getting to the core: commercials. Contract negotiations typically start by debating which contract template to use: the customer’s or the supplier’s. More often than not, we end up with the customer’s contract template — which is fine, as long as the document is a template: When I’m spotting our competitor’s names in the customer’s “standard contract”, I’m starting to doubt whether it was a good idea to agree on the customer’s contract template.

Normally, it’s too late now to switch templates, so we’re trying to make the best of the situation and enter all the corrections in track change, trying not to embarrass anybody. When the contract has gone back and forth repeatedly and there are more track changes on the side of the document than your screen can hold, procurement suddenly agrees to finalize and execute the contract. Of course, under the condition that legal clears it first. Correct, they pass it on yet to another entity who wasn’t involved before and who hasn’t any knowledge about the project.

Irrespective if you are dealing with a tender or a direct procurement, there are many fallacies along the way. Let’s look into some of them.

Fallacy 1: Over-Administration

This is the most common fallacy, and all large organizations suffer from it. More and more, it spreads from large to mid-size organizations, too. It’s about formalities like budget ownership, sign-off authority, contract templates, involvement of legal, and stuff like that. Over-administration usually takes longer to overcome than the proposal validity period.

One of our customers accidentally shared their Contract Authorisation & Signature Request Form with us. Believe it or not, it carried 14 signatures. That is, 14 people had to approve the signature of the contract, which was then signed by two people. Although this signature orgy took place through DocuSign, the entire signature process took almost three months to complete.

Another customer signed the contract with us, only to inform us a few days later that there would be another delay of 2–3 weeks before the project could start because they failed to involve their compliance person before the contract signature. No kidding. People sign contracts and then tell you they need to revoke their signature because they “forgot” to involve their administrative functions. Needless to say, the delay of 2–3 weeks grew into a delay of 2–3 centuries; the contract was never signed.

Fallacy 2: Too Many Requirements

It’s certainly good to define the requirements before floating an RFP. However, defining the requirements is often a time-consuming process, as many stakeholders need to be included.

The more stakeholders you involve, the higher the risk of diverging requirements, and too complex solutions as a consequence. This might haunt you later during the implementation phase when people who contributed some of the diverging requirements think you didn’t deliver what you promised.

We were in an RFP recently where we had to answer 1'500 requirements, over half of them non-functional (we normally see 200–300 requirements in other tenders). No wonder the prospective customer engaged an external company to manage and evaluate the RFP responses. This in turn makes the process even heavier — the more time you devote to writing and evaluating requirements, the more you can charge for your services. Only lawyers are worse.​

In another RFP, the IT security requirements were just a plain copy-paste of the ISO 27001:2022 norm. We answered them jointly by sending in our ISO 27001 certificate. This could have been one single requirement: “Must be ISO 27001 certified.”

Fallacy 3: Monster Solutions

When people define hundreds or even thousands of requirements, they tend to over-specify solutions.

The more requirements you have, the more stakeholders you need to involve. And the more stakeholders are involved, the longer the discussions take.

Start. Procuring the first phase of a solution quickly is so much better than discussing aspects that may matter down the road for ages.

That’s why I usually say, “Let’s cross the bridge when we get there.” In procurement terms, the tool of the trade is called a framework contract. Besides agreeing on the scope and price of the first phase of a solution, you also define the cost positions of additional items such as services and software licenses.

One of our customers masterfully lived up to creating a monster solution. We were bogged down in solution definition workshops over months, and literally, every person in the organization was asked for their input and requirements. The result of those discussions was that our solution needed to be able to do everything for everybody, interface with every other system there was in the organization, and be rolled out to every single person in the organization.

When the corresponding — very pricy — proposal reached the decision maker, he called me and said that it was way too expensive. After some back-and-forth, it was divided into phases, and the first phase that was ordered was one-sixth of the price of the original monster solution.

But at least they put a framework contract in place, so we can go step-by-step.

Fallacy 4: Internal Reorganization

Big organizations love internal reorganizations. No matter if this is due to economic pressure, mergers & acquisitions, or due to the taste of a new chief executive.

Here is how you usually learn that there is an internal reorganization. After months of radio silence, you’re checking in with procurement, asking about the status of the RFP and the next steps. You are told that there is a hold-up due to an internal reorganization, and they will get back to you as quickly as they can. Or not.

In one recent tender, the prospective customer merged with three direct competitors, so the tender wasn’t awarded. Instead, we were told that there would be some additional requirements from the newly merged competitors, but those additional requirements weren’t sent through over months.

In another recent direct procurement, the contract was ready in its final version, and the contract signature was promised for 10 months, but postponed repeatedly due to internal reorganization. An escalation only yielded another promise that the contract would be signed in the next 2 months — this became the first deal we actively walked away from. Ironically, they came back to us a few months later, requesting us to participate in a tender they finally floated.

Fallacy 5: Not Understanding Negotiations

Negotiations are supposed to be win-win, and if you’re an entrepreneurial person, should even be fun. They should leave both negotiation partners happier at the end of the negotiation, making things possible that didn’t seem doable at the start of the negotiation.

Good morning, enterprise world.

When all the fallacies described above are finally overcome and negotiations start, I often feel like it’s not a negotiation, but a dictate. Here are some examples of what I have heard in so-called negotiations:

“We really can’t accept any payment conditions other than 60 days arrears, with monthly invoicing of the software license fees. It’s our internal policy.”

“When we negotiated our first contract back in 2019, your software license prices were 10% lower than now. We still want to buy from you at the 2019 prices.”

Seriously, guys. Even if you are the big fish, and I am the small fish, you should start thinking of what you can give if you want to take. If you don’t want to give in a negotiation, don’t call it a negotiation. Call it an enforcement, eat-or-die, or an ordinance. Just send through the signed contract, and I will decide if I counter-sign or walk away.

Conclusion

Procurement’s original mission was to prevent your incapable cousin from supplying sub-standard and overpriced goods and services to their company.

This original mission has morphed into a complicated affair, often delaying decisions by more than one year after the final offer was handed in.

In an innovative, fast-moving world, your product might have changed significantly during this period. And if you’re unlucky, procurement will tell you at the end of the process that you will have to deliver exactly what you offered over one year ago, even if your product has improved in the meantime.

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INSPIRATION FOR RESILIENT ENTREPRENEURS

Multiply Time Estimates by Pi, And Deadlines Start to Make Sense

Dependencies, root causes, and different perspectives derail any ambitious time estimate

“Until when can you get this task done?”

“When can we expect an update on this?”

“I need this to be completed by tomorrow.”

We all know those requests from our daily lives. Customers, managers, and even employees want their priorities treated as priorities. But even with the best team, work ethic, and skills, most things take longer than expected. People don’t understand why and get frustrated about delays.

“Why does this take so long?”

“Can I escalate this issue?”

“You tell me you’re on it, but nothing happens.”

Here’s the secret: Even when you’re ambitious and on top of things, everything takes much longer than expected — as a rule of thumb, multiply your best estimate by Pi.

Why so conservative and multiply by roughly 3? Let’s look into some real-life examples from my life as the Founder & CEO of Yonder.

Dependencies

Let’s assume you have a single task to do today, and it’s a simple task. For example, chopping firewood. Zero dependencies, right? Not quite. If your saw isn’t sharp, this task will take much longer than anticipated. You can’t sharpen the saw yourself, so you decide to go and see a specialist who can sharpen the saw for you. Once you reach the specialist’s place, it’s closed. Maybe the guy is sick, on vacation, or busy sharpening other saws for other people. Even if you promised to chop the firewood until the end of the day, you won’t be able to complete this seemingly simple task within your promised timeline.

Let’s move into more complicated tasks, like building and maintaining a B2B SaaS product. Dependencies are everywhere, both technical and organizational. It doesn’t matter if the technical dependency needs to be solved on your side, or the organizational dependency is due to an open response from a customer who happens to be out of the office because of a national holiday in a different country, a vacation, or because it’s Ramadan. Welcome to the world of doing business globally.

Different Perspectives Needed

Some tasks seem easy at first sight, but they aren’t and need a second thought. Now and then, somebody reaches out to me with a weird proposal that sounds compelling at first sight. For example, the biggest companies on the planet like Boeing or Apple wanting to partner with us, a small B2B SaaS company. Of course, they always want an immediate response if they could count us in. But it pays off to first find out what exactly they are looking for and then discuss the proposal with key people on your team and your board. In almost all cases, adding those perspectives improves the decision of whether or not to pursue the proposed partnership — even when it comes at the price of a delayed decision.

Finding the Root Cause

Some problems are downright ugly. Consider software bugs that cannot be reproduced on your side, but keep occurring on the customer side.

Of course, such problems are always urgent from the customer’s perspective. And of course, we want to fix those bugs as quickly as possible. But sometimes finding the root cause that causes the bug takes way longer than what is acceptable to the customer, because the root cause is hidden deep down in an edge case of your software, or it’s because of a crazy IT security configuration on the customer’s side: Missing whitelisting, restrictive endpoint security software, blocked shaped traffic, you name it.

Even if solving such problems takes enormous amounts of time, it’s still better to fix them at the root cause level than applying a quick fix or a hack that only adds more dependencies to your software.

Conclusion

Good solutions take time, there is no way around it. Even if people don’t want to hear that you need more time than anticipated to solve their problems, it’s fair to tell them why you need more time.

But of course, that’s not an excuse to push things out that could be done quickly.

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About Me

Growing a company 📈 in uncertain times 🔥🧨 is like running a marathon—it demands grit, strategy, and resilience.

As a tech entrepreneur 💻, active reserve officer 🪖, and father of three 👩👦👦, I share practical insights and experience on entrepreneurship and resilience in The Resilient Entrepreneur, my weekly newsletter.

When I'm not solving problems, I recharge and find inspiration in the breathtaking mountains 🏔️ around Zermatt 🇨🇭.

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