Date: Sat, 27 Nov 93 14:19:55 EST
From: art@midnight.com (Art Mellor)
Message-Id: <9311271919.AA04526@midnight.midnight.com>
To: rdshydur@MIT.EDU
Subject: [peter: Things We Think We Got Right]
Reply-To: art@midnight.com (Art Mellor 617/890-1001)


Here's the list!

...............................................................................
  Art Mellor       : Midnight Networks Inc. 100 Fifth Avenue Waltham MA 02154 
  art@midnight.com : Vox 617/890-1001 Fax 0028  The Best in Network Software

   GILB'S LAW #2: Any system which depends on human reliability is
			     unreliable.


Return-Path: <peter>
Date: Fri, 26 Nov 93 21:49:05 EST
From: peter (Peter H. Schmidt)
To: art
Cc: all@midnight.com
Subject: Things We Think We Got Right
Reply-To: peter@midnight.com


[Art - Forward to Richard S?]

			    Midnight Networks Inc.
			 Things We Think We Got Right

		     Peter Schmidt, Art Mellor - 11/23/93


Here is a list of the things which we think we have gotten right about running
Midnight Networks for the past two years.  We already believed in most of them
before we started, but we've been surprised by just how right they are.
Others we had no idea about, but we have been taught to value them by
experience.  Here they are, in no particular order:

1. Setting expectations correctly is the most important key to success, with
   - customers, especially
   - co-workers
   - yourself

2. Always use intelligent persistence - eventually (may take months, may take
   years) "no" will become "yes"

3. Ask your friends for help - they can give you
   - good business advice
   - emotional support in what is an often highly stressful endeavor
   - pro bono professional services (like graphic design, accounting
     consulting, marketing help, etc.), just for the joy of using their best
     skills on a "fun project"

4. The combination of competence and honesty is remarkably rare.  Thus, it can
   be a competitive advantage for you.

5. Let your customers fund your product development.  They know their needs
   better than do you or venture capitalists.  If they want something, odds
   are a bunch of other people want it also.  Make sure you keep the rights to
   everything you produce via contracts.

6. Do a newsletter.  Send it to friends, family, old customers, and new
   prospects.  Send it out quarterly, and try to make it light, fun and
   moderately informative.

7. Talk to your lawyer often.  A good rule of thumb is, can she/he summarize
   the current state of your business' affairs to a third person?  Another
   is, do you have his/her phone number memorized?

8. Fit into a category/Play a known role.  Sure, you have to be different in
   some way: better, faster, cheaper, cleaner, etc.  But don't try to be
   different in too many ways, or people won't understand how your offering
   connects to their problem.

9. Come up with a good name and logo.  Ours generates a lot of interest in us;
   here are the rules we used to come up with it:
   - the name has to be easily understood when pronounced over the phone
   - you should never need to spell it out for someone
   - it should be distinctive
   - it should capture something of the image you want to convey in the market
   - it can't use any of "-tech," "-ix/-ex," "-tron/-ton," "system" or "-com"
   - it can't be a name of any of the founders
   - the logo should be designed in cooperation with a professional graphic
     designer 

10. There is always competition.  You are in business to solve customer
    problems, but these problems didn't just spring into existence yesterday.
    Your customers have been dealing with them one way or another for a
    while, and you must compete with whatever method they are currently
    using.  The hardest sell may be when what they're currently doing is
    nothing!  After all, doing nothing doesn't require writing checks, and
    whatever you are offering to them probably does...

11. There are no competitors, only other companies.  If someone else is
    solving the customer problem that you want to, offer to do the solving for
    them.  License your technology, enter into joint marketing agreements, hire
    them as a reseller, buy their company - the last thing you should do is
    start calculating how much "market share" they're "stealing" from you.

12. Everything always takes longer (but see below).

13. Kaizen.  This Japanese philosophy of continuous improvement drove them to
    improve their manufacturing until it is the best in the world, and
    they`re still making it better!  Use it to get over trying to always do
    the perfect solution the first time.  Start with your best shot, and then
    make sure you regularly review how it's doing, and then improve it in the
    ways that become obvious.  This takes out a lot of stress.  But you have
    to make improving everything a key goal and part of your corporate
    culture, or "kaizen" may become just another name for management by
    fire-fighting and the chaos that results.

14. Focus on your processes and the products will follow.  Solve problems by
    designing a process that will keep them from happening again, and then
    kaizen that process.

15. Treat _everyone_ as if you will soon be sitting across the table from
    them, trying to close a big deal.  Everyone in your industry knows
    everyone else.

16. Communication is more important than your mother.

17. Plan in detail - forcing yourself down into the details helps catch all
    those "oopses" that make things take twice as long.  Everything will still
    take longer than you estimate, but not grotesquely longer.  And you will
    find that you get better and better at closing the gap.

18. Document everything: processes, important bits of information, your daily
    tasks, etc.  If everybody gets in the habit, it won't take long, and it
    quickly becomes an invaluable resource.

19. Automate wherever you can, but don't do it faster than you need to - it'll
    be a while before the marginal savings outweigh the up-front costs.

20. Openness is essential.  It will lead to trust between you and you
    customers, and between you and your co-workers.  Without openness, you
    cannot learn from each other, and kaizen becomes impossible.

21. Talk to customers in advance.  Let them tell you what they want. Do market
    research! 

22. There is always a good solution.  Use your head and find it.

23. Flexibility yields job satisfaction, nimbleness in the face of changing
    customer demands, and adaptability that is able to benefit from new ideas.

24. Customers need solutions, not technology.  On occasion, you can broaden
    their horizons of what is possible by exposing them to new technology, and
    they will then recast their problem in terms that your technology can
    solve.  Or they may not, and you need to be ready for that.

25. There are N ways to do anything.

26. Admit your screw-ups immediately and take responsibility for them.  Your
    customers and employees will love you for it!  Well, they will if you also
    kaizen a process that will keep the screw-up from happening again...

27. Your business needs a superlative: best, fastest, most economical,
    farthest out on the cutting edge, most profitable, most visionary, most
    fun to work for, best value, cheapest, youngest, etc. etc.  This gives you
    and your employees a hook on which to hang your goals.  And it's good for
    morale too!

28. Talk to others in the business regularly so that you keep getting
    reminded that you're not alone out there.

29. Make sure that everyone is responsible to each other for results, then
    leave the methods up to individuals - and resist the urge to
    back-seat-drive!

30. Your corporate culture should be explicit so that you can kaizen it.
    Decide what you want it to be in cooperation with your co-workers, and
    then take steps to make sure that it becomes whatever you decided on.

31. You are married to your partners, and the company is your child.  If you
    have a spat with a partner, you will lose sleep over it just like you do
    when you fight with your spouse.  If you recognize this and work on the
    relationships, you can derive many of the emotional rewards of marriage in
    your day-to-day interactions at work.

32. Cash is more important than communication.  Business cash flow is
    _very_different_ from personal cash flow: income is a lot more irregular
    and uncertain, and outgo tends to come in lumps.  You have to watch it
    all the time, lest you get to exercise "executive privilege" by foregoing
    your paycheck.

33. Negotiate on everything you can, but be sensible about it.  The other guy
    needs to make money, too.  

34. Have as your first instinct to Be Cheap.

35. Your employees' attitudes toward the business aren't the same as yours.

36. Running your business is more work than you imagine, but it's _way_ more
    fun, so on balance you're way ahead of the game.

   Copyright (C) 1993  Peter Schmidt and Art Mellor.  All rights reserved.


Peter H. Schmidt        |`'| .  | ,_  .  , |_  +      Midnight Networks Inc.
peter@midnight.com      |  | | (| | | | (| | | |,     100 Fifth Avenue
tel: 617/890-1001                       _|            Prospect Hill
fax: 617/890-0028        N  E  T  W  O  R  K  S       Waltham, MA 02154