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Operations and Internal Communication Strategies For Effective CEOs

Leonardo Federico · November 30th, 2019

Most of us are wired to believe that if we say something, those who hear us will just naturally execute it exactly as we had envisioned it in the first place. If only managing people were that easy. In reality, just because you said, doesn’t mean it’s actually going to happen. Without providing the right direction, determination, and ongoing communication about thecontext of the work to be done, the chances of actually observing the result you envisioned are very low.

The fundamental premise is that success is achieved not when the CEO thinks something is important, but when everyone thinks it is. What follows are some prescriptions to help you understand how effective CEOs, and leaders in general, should think about internal communication and operations. First we’ll go through some basic principles, then we’ll look at some real-life examples from some of today’s best companies, including Salesforce, Drift, Front and PayPal. This essay is about practical tactics and key insights from world-class leaders and operators. We’ll discern what some of the secrets to their success are, as well as how you can implement them and avoid common traps and mistakes.

Narratives (not facts) are what move people

Subtract facts from reality, and what’s left is storytelling. Great leaders know that while facts help people understand and comprehend reality, it’s in narratives that make enthusiasm, excitement and passion “happen”. Ultimately, we are the stories that we tell.

If you want to build a ship, don't drum up people to collect wood and don't assign them tasks and work, but rather teach them to long for the endless immensity of the sea.

This quote from Antoine de Saint-Exupery was rightly pointed out in one of the comments of my latest write-up.

When communicating important new messages, rather than presenting new facts try thinking of it as broaching a new narrative. Think of what you’re trying to accomplish in a broader and more holistic way, surrounding the facts (the actual company goals and milestones) with a convincing and appealing narrative. A good narrative can not only help you make facts more compelling and inspiring, but it can actually make them easier to understand. The more your narrative (as opposed to the facts) resonates with its intended audience, the more likely you are to have an impact and actually make an impression in people’s heads.

Last week I introduced the idea of the context of work in an essay titled “The Secret to Effective Employee Engagement". In that piece, I wrote:

The actual questions are: How can leaders motivate people? What’s the actual driver for individual motivations? And what actually encourages alignment and enables the best individual work? The answer is clear and continuous communication about the context of the work to be done.‍ In practice, this means telling people: "Here's exactly where we are and here's what we are trying to accomplish." Employees at all levels want and need to understand not only the particular work they're assigned but also the larger story of the way the business works, the challenges the company faces and the competitive landscape. People need context to really do their best work.

While I explained in depth what the context of the work to be done is all about, I skipped the fact that great context is built through powerful narratives. Great leaders don’t believe in casual context, they are able to create meaningful and pervasive context by leveraging narratives.

As your business scales up (by way of hiring more people and expanding to new offices), so too does the scope of objectives, priorities, themes and eventually storylines that you end up communicating. This will inevitably lead to a larger number of narratives being shared with the team. Yet, people can only grasp so many things at once. Once you pass a certain threshold, try consolidating. Even more importantly, as communication has little to do with what you say, and more to do with what people understand – try taking things off the list. As people have a maximum cognitive capacity per day, be thoughtful about the signal/noise ratio of your message. The fewer and more distilled the things you communicate, the more likely people will be able to successfully absorb the message.

The why always before the what

Your best people want to know the why and understand the broader context beyond their individual responsibilities. Just because you said the what, it won’t magically make it happen unless you have a very convincing why. To make things happen you need to spend a disproportionate amount of time on the why than the what.

Your audience is already busy with their own work. In order to get them to take notice, and far more importantly, change behavior, it's essential you provide the context behind your message. The deeper you get into the why the more they will buy into your message. Don’t just limit yourself to the basic reasons. Why does this particular thing matter so much right now? Why does it have an even higher priority than what the team is currently working on? Are there any numbers to support this? What’s the underlying strategy that ultimately justifies this? Why is this a better strategy than the one discussed last month?

The goal is to get to the root of the matter and make sure nothing is left unsaid. While this exercise alone is paramount to setting the entire understanding of the team, it’s also useful for clarifying your thoughts.

Alignment is not one-way only

No matter how clear and profound your explanations, after explaining the facts and your narrative, it's equally critical that the team feels heard on the subject. People have different perspectives and it’s vital that communication goes both ways. People must be able to ask questions and offer critiques and ideas. Ideally, they should be able to do so with all managers, including the CEO.
Humans are naturally reluctant to change. The greater the impact of your decisions on their work, the more space you have to give them to ask for clarifications, whether it’s about something new they expected to do or a decision made by management, for instance. Not only does this mean they will be better informed, but over time it will instill throughout the company a culture of curiosity and deeper commitment.

Twoway communication won’t happen automatically unless you plan for it. Pick a system that’s designed from the ground up to support bi-directional (both top-down and bottom-up) communication.

Repeat, repeat, repeat

David Gergen, former advisor to several US presidents wrote:

History teaches that almost nothing a leader says is heard if spoken only once

There’s no doubt here: repetition is the mother of all learning. If you want to inculcate in people a specific message or a specific new set of behaviors, you have to repeat things. To make sure your message is really percolating down to every member of the organization, you have to repeat it so often that “you grow sick of hearing yourself say it” as Jeff Winer former LinkedIn CEO simply put.

Being a great CEO means you have to enjoy telling certain stories over and over again. If done correctly and concisely this will end up creating what I call the “inner voice”. If the outer voice concerns what you tell people, the inner voice concerns what they tell themselves.

The best leaders are able to determine the inner voice i.e. what people say to themselves in the back of their minds. There are no shortcuts to this, it just takes time and effort.

How to Communicate as a Founder CEO

In this section we will tackle some practical examples of recurring internal communication that you as a Founder CEO can easily embed in your own internal communication framework, making it part of your weekly, monthly or quarterly routine.

Weekly Team Update

One of the best communication strategies for entrepreneurs is a weekly update email to employees, advisors, mentors, and investors. The email gives an overview of tactical updates from the previous week and for the week ahead. Initially, the email should be pretty simple, expanding as the company grows and its departments formalize. The basic macro elements that you should always include are: revenues, recruiting, product and customers.

Here’s a structure that you should follow:

  1. Premise: write a quick paragraph summary about what happened last week
  2. Yearly Goals: current metrics for annual goals and how you’re measuring up against them
  3. Quarterly Goals: current metrics for quarterly goals and how you’re measuring up against them
  4. Quarterly Priority: percentage complete and any updates to the most important projects
  5. Revenue: The top three weekly metrics for the sales team, or for smaller teams, the top three metrics for every person on the sales team (e.g. calls, appointments, deals won, new recurring revenue, etc). By having every sales rep listed with their -metrics, it provides transparency and peer-pressure to hit their numbers. Comments or highlights from last week (e.g. the name of a big customer win or customer stories in general)
  6. Product: (1) Features that went live in the last week and (2) features that are going to go live in the next five days
  7. Marketing, Customer Service & Customer Service: The top three weekly metrics, plus comments or highlights from the week
  8. Operations: new processes or procedures (eg. a new Slack etiquette, a new remote work policy, new room procedure or new habits that you are trying to inculcate generally)
  9. Culture Highlight: share topos, stories or examples from the week that project the company culture
  10. People spotlights: give exposure to members of the team and expose their work to the entire org

Mathilde Collin, Front CEO, has disclosed the template that she used to send over the years to all Front employees. As you know, consistency is key here. She’s never missed one in 4 years — and the format remains largely unchanged.

Weekly email that CEO at Front send to all employees to stay on the same page

This email takes about 15 minutes maximum to compile each week and can have a profound effect on your organization.

Metrics Weekly Round-Up

Peter Thiel, back in his days as Founder/CEO at PayPal, used to run internal weekly and monthly staff meetings to discuss every single metric behind the company’s progress.

Unlike software companies in the ‘90s (telemetry systems were far from accurate back then), today’s organizations tend to track everything. The problem is that not everything we track is actually important, and as a leader it’s part of your job to translate all those numbers into chunks of information that are easy to understand and digest. In a world of abundant information, your ability to create signals by quickly zeroing in on the most valuable and relevant content creates a competitive advantage.

You can aggregate the top three most important company-wide metrics in a single digest that gets delivered to everyone. This ensures everyone is on the same page and that you are all executing towards one common goal.

Beyond the Obvious Weekly

As a Founder CEO there are certain things about your company that only you can see. How does your product fit into the big picture? How is your product going to change your industry category? What is your company actually about? What’s the underlying secret upon which your company is predicated?

Just because you shared your vision once in the onboarding camp, doesn’t mean people actually understand and believe in it. That’s why sharing your thoughts in internal memos is so critical to helping the people around you understand the broader context of your vision and how your organization fits it.

You want to communicate the broader picture and go beyond the obvious. Use these types of communication to give employees the broader picture:

  • If you’re company is about building advanced rockets and spacecraft, don’t just talk about physics, design and manufacture, talk about going to Mars and making human life multiplanetary.
  • If you’re company is about building computers, don’t talk about hardware and software, talk about creating a “bicycle for the mind”.
  • If you’re company seems to be an ecommerce business, talk about why it’s actually about technology.
  • If you’re building an online CRM, talk about how it’s going to change the status quo of software distribution and sales in the years ahead.

While the creation of new narratives will help you in each communication, they are indispensable in these types of messages.

Personal Weekly Newsletter

As an entrepreneur, there are always things that keep you up at night, yet most people aren’t aware of them. Write a personally curated publication that’s shared on a weekly basis with your entire company. This type of communication will help you share the thoughts that wouldn’t normally make it into an all-hands meeting or a more tactical company-wide update. This allows your team to get a deeper sense of who you are as a person, how you think about the company’s values, and what’s at the forefront of your mind as the company scales.

One relevant example in this category is David Cancel, Drift Founder/CEO.

Cancel writes a weekly email newsletter every Sunday night to share his thoughts with the entire company. These emails cover anything from company scaling and how to make the best decisions to how Buffet solves problems.

What’s unique about this email newsletter? Anyone can subscribe to it — whether you work at Drift or not. You can read his previous emails on The One Thing.

DC latest issue:

It finally hit me, Slack overload.

I’m overloaded with the number of channels we communicate across at work. That might be a shock to some of you as I am infamous for being able to keep up across a large number of channels and people. Maybe it’s (280 team members) * (an infinite number of slack channels) + (280 teammates) * (email, twitter, whatsapp, sms, etc) that has finally hit some tipping point but I am changing the way I communicate.

Here’s how I am changing: I am bringing back Email. I’ve been email bankrupt for years but I’ve finally gotten to inbox zero and have maintained that for about 2 months now. I will use email when communicating important announcements, stuff that requires the recipient to digest and other content that doesn’t need a real-time conversation and might get lost in the endless sea of Slack. Asynchronous (non-realtime) messages when not urgent.

Email is one form of async tool but two others I am relying on are async Audio messages and async Video messages (like whatsapp, Drift Video, etc). I’m relying more and more on async messages and less and less on synchronous messages (real-time Slack). I am dealing with important issues face to face or via phone when I can. Instead of an endless back and forth in Slack trying to get my point across I am just having a real conversation when convenient. (not a meeting just a conversation)

As we design Drift (we support both asynchronous and synchronous messaging) let’s keep these issues in mind and try hard to do the work for our users so they can focus on the Now.

– DC

All-Hands Meeting Notes

This is probably the most important meeting in your entire company. This is where everyone convenes to make sure the entire company is executing in the right direction. You want to maximize coverage and make sure every single item that was brought to the meeting has actually been understood by every single person in your team. One way to do this is to make sure you send the team company-wide minutes after the meeting has ended.

Here’s the structure of a template that you can use:

  • New hires!
  • Product update (OKRs, Special features)
  • Revenue updates (OKRs, customer of the week)
  • Special topics
  • Weekly awards
  • Leadership musings
  • Q&A

Quarterly V2MOM

As a Founder CEO you should take the time every quarter to ask questions about whether the company is executing in the right direction, where a disconnect may be arising and if necessary, re-align efforts to ensure that everyone is on the same page. One of my favourite examples of this is Benioff’s V2M0M. In Behind the Cloud, Benioff describes the V2M0M as one of the main contributors to Salesforce’s achievement of high-level organizational alignment and communication while growing at breakneck speed.

Benioff wrote:

When I was at Oracle, I struggled with the fact that there was no written business plan or formal communication process during our growth phase. In fact, I remember asking Larry Ellison during my new hire orientation, "What is Oracle's five-year plan?" His response was simple: "We don't have a five-year plan, we barely have a six-month plan." (Even for that, there was no written plan, only a budget.) It was our job to figure it out what Larry wanted on our own.

What I yearned for at Oracle was clarity on our vision and the goals we wanted to achieve. As I started to manage my own divisions, I found that I personally lacked the tools to spell out what we needed to do and a simple a process to communicate it. The problem only increased as the teams that I was managing increased. I went out to look for help. I sought wisdom from leadership gurus, personal development gurus, and even spiritual gurus.

Over time, I realized that many of these seemingly disparate sources shared striking similarities. I looked to employ these common threads in my own work, and over time I developed them into my own management process, V2MOM, an acronym that stands for vision, values, methods, obstacles, and measures. This tool (pronounced "V2 mom") has helped me achieve my goals in my past work and helps make salesforce.com a success. Although there are many leadership paradigms and frameworks available to follow, V2MOM offers a new simplicity. It is easy to digest, unlike other programs that take longer to understand than they do to implement.

V2M0M is intended to enable you to clarify what you are doing and communicate that to the entire company as well.

The vision helps you define what you want the team to do. The values establish what is most important about that vision; it sets the principles and beliefs that guide it (in order of priority). The methods illustrate how you will get the job done by outlining the actions and steps that everyone needs to take. The obstacles identify the challenges, problems and issues you may have to overcome to achieve your vision. Finally, the measures specify the actual result you aim to achieve.

Combined, V2M0M should give you a detailed map of where you are going as well as a compass to direct you there.

In short, the V2M0M is an exercise in awareness, the result of which is total company alignment. Not only it does it help to clarify direction and focus collective energy on the desired outcome, it also eliminates the anxiety that is often present in times of change.

Below is the first Salesforce.com V2M0M, back in April ‘99:

First V2MOM that Benioff sent at Salesforce

As Benioff pointed out,

The beauty of the V2M0M is that the same structure works for every phase in the life cycle of an organization. We've used it as a business plan for our start-up, and we find the same construct to be effective for outlining the annual goals of a public company.

To come up with your own version of Salesforce’s V2M0M, you should think about your overall organizational goals or a present-day challenge within your organization, and discover how you can outline the steps to succeed.

What a Founder CEO should expect from their exec team

As a Founder CEO, it’s not just a matter of how you communicate. Your responsibilities also include the communication of your entire executive team. Generally speaking, you should expect your exec teams to distribute context at the edge of the organization.

While good leaders are able to create context in their teams and within local scopes, great ones are able to distribute it effectively to the entire organization, increasing global awareness and maximizing context.

Here’s a couple of ways to do it:

Make public meeting notes

Meetings are still where most decisions are made. When information is siloed and there’s no clear track of decisions accessible to anyone, knowledge gaps and misalignment can often arise.

To prevent that, Founder/CEO Jack Dorsey, famously initiated the meeting-notes policy at Square. As he explained in an interview back in 2013:

Any meeting of more than two people, someone’s required to take notes and send them to an [email] alias

This also has the secondary consequence of preventing people from being unproductive because they want to participate in meetings at all costs. Square’s policy not only helps make sure that decisions are always transparent before the eyes of everyone, but it also helps information percolate down to the entire organization.

Here’s a framework for making good meeting notes:

  • Purpose: What’s the point of this meeting?
  • Agenda: Link to any notes here, or briefly explain the schedule you’ll follow
  • Limits: What you will and will not do during this meeting
  • Decision: Are you hoping to reach a decision from this meeting? If so, state it here.

Email Transparency

Help the exec team to share updates with the entire organization, not just their own teams. Share team updates to “enrich” other teams and propagate the information.

Stripe was one of the first companies to embrace the idea of full email transparency. By convention, every email at Stripe is CC-ed to lists that go to either the entire company or to a particular team. This includes internal person-to-person correspondence. The lists include dev, sys, office, product and support.

This eventually allows everyone to dip in and out of the company’s fire hose whenever they want. It gives every one of your team members a tremendous insight into what other people are working on, and a feeling of connectivity to the rest of the company.

As ridiculous as it may sound, I not only think this is important, but I also think this will be essential to how teams operate in the near future.

While Stripe’s approach is certainly brought to the extreme, there are nuances, and you can decide for yourself the extent to which information should be transparent and ubiquitous in your own company.

General Principles of how you should operate as a Founder CEO

1. Cut through the clutter

If you don’t pick the right medium, you won’t have people’s attention. It’s simple as that. Make sure your message is able to cut through the clutter. Pick a medium where people are actually able to focus, and read at a slower pace. I’ve talked extensively about the difference between cold and hot media

, and why you should always stick to hot media for high-resolution communication. (Slack is a cold one). At Sametab, the company I’m building, we are fully committed to the idea of using a better “firehose” in modern companies, and to staying aligned and aware on the important things in the age of information overload and abundance. (I warmly invite you to sign up to explore our first product).

2. Pick an internal naming convention

Create an emotional connection between your messages and your people. Learn to treat your people as a fully formed audience and your message as internal publication. It’s easy to call a weekly email update about the top metrics “Weekly Metrics Update”, but that won’t resonate with people as much as “Two Truths and a Take”. Find good terminology that resonates with people and jumps off the page. Not only will this help your publications to become really embedded in your company’s culture, people will also create an emotional attachment to your terminology over time and will inevitably make it part of their glossary.

3. Be Consistent

In my latest essay “The Secret to Employee Engagement” I wrote:

[...] At this point, you should bear in mind what type of content (messages) you need to talk about and how it’s going to be distributed (the medium). Those two aren’t enough if you don’t develop what I call a strong heartbeat of communication. Working out how to do this — and for company leaders and HR executives, coaching all managers to do it consistently and continuously — takes a lot of time. Finding an organization pace not only means finding a rhythm regarding the creation/distribution of information, but also letting people create personal habits of information consumption over time.

One of the keys to good internal communication is consistency. As your goal is to create habits in people’s behaviour, you want to stay consistent and avoid making too many changes on the fly.

Once the schedule is made, you should never miss an update. Once the medium is selected, you should never change it. Once the tone is established, you should never subvert it. Once the content bottomline is defined, you should never drift away from that.

That’s the only way to build people’s habits. There are no shortcuts to this, it just takes time and relentless effort.

4. Measure, Measure, Measure

Just like you measure everything about your product, you also want to measure everything about your internal comms and operations. That’s the only way to improve it at scale.

In a lecture titled “How to Operate”, Keith Rabois explained how back in his early days at Square as COO, he created an internal dashboard to display internal key metrics for the company. Everyone from Engineering to Customer Support should be able to grasp it easily.

The unique thing was that he measured the effectiveness of that dashboard based on the numbers of “Squares” that checked it every day.

Internal dashboard that Leadership at Square built to keep people on the same page on the most important metrics

When you communicate an important message, how do you know people are actually reading and absorbing what you are saying? The absence of a feedback loop makes the entire system less accountable and more unpredictable as your organization grows. Instead of mistakenly assuming that people are reading and understanding, it’s better to communicate through a transparent firehose where metrics, such as read-rates, are publicly visible to you and everyone in the team. Data can do more than inform your strategy and have an impact on what you say or how you say it; it can actually make people feel how compact and aligned the organization is.

Conclusions

One thing to bear in mind is that good communication compounds over time. But by the same token, the implications of bad communication magnify progressively. If your people aren’t informed by you, there’s a good chance they’ll be misinformed by others. If you don’t tell them how the business is doing, what your strategy is, the challenges that you’re facing or what market analysts think of how you’re doing, then they’ll receive misinformation elsewhere, either by other equally ill-informed colleagues or from the web.

In Manage by Context, not Control

I wrote:

Most people think conflict arises when A thinks X and B thinks Y. In reality, conflicts have a higher chance of arising not when people don’t share the same ideas, but when they don’t share the same context and don’t make judgments using the same lens.

Poor information and unaddressed knowledge gaps compound over time and lead to all sorts of inconsistent contexts, and differing contexts are the root cause of conflict and unnecessary disagreements. If you don’t provide the same context that you have, your people are going to weigh decisions differently, and you’re going to be frustrated when they don’t execute as you think they should.

The job is never done

As cheesy as it might sound, this couldn’t be truer. As a leader, you should spend most of your time on good, high-resolution communication.

Whether it’s a new hire that just joined the team, a new team that you just formed, the acquisition of new customers or a status update on the progress of an internal project, you should always be communicating. Never mistakenly assume that work is getting done, take the time to ask questions about where the disconnect is, re-align efforts, and ensure everyone is on the same page. The job of communicating is simply never done. Work hard to make it part of the daily routine of yourself and the leaders and the operators in your company.

Thanks to Stefano Bellasio for reviewing drafts of this.