By Jason Fried and David Heinemeier Hansson
Authors Jason Fried and David Heinemeier Hansson believe founding your own business have never been easier than it is today, and starting your own company takes less time than you might think. In the pages of this book, they not only explain how it’s possible to start your own business immediately, but they also detail how to use your small size to your advantage, and give practical advice on how to run and grow your business effectively – beginning from the moment you launch.
My Top 3 Takes from the Summary
Launch as soon as the core of your business is ready. Don’t wait for everything to be perfectly in place.
Start small, but begin with a clear path to profitability in mind from the outset. Be a business, not a hobby.
Be authentic, and focus only on what matters to you and your business.
Change the Way You Work Forever
The message conveyed by the authors is that by reworking your approach to starting a business, you can change the way you work forever.
The first bit of advice shared is to test the waters before you give up your day job. By starting small, you limit the potential to find yourself slaving through extra-long hours each week and accruing crippling amounts of debt. The authors suggest devoting just a few hours each week to working on your idea initially, providing an opportunity to gauge the market or test the response to it. If you start small, you need far less time and resources than you imagine, and the authors believe that in most cases, a laptop and a good idea are all you need, seeing everything else as peripheral to your success.
Your initial efforts should be focused on building the core of your company. As an example, hotdogs are the core of a hotdog cart operation, so your core is something you think will remain stable in your business. Amazon is used as another example: the company’s core wasn’t just about books, it was about fast shipping, affordable prices, and a wide selection. These were the things people would always be willing to pay for, irrespective of publishing fads that may come and go. The authors’ key message on this topic is that you should “just get started and wing it,” a point they illustrate by telling the story of 37signals and its Basecamp product. At the time of launch, they had no established means of billing customers, but with a monthly billing cycle, they launched anyway, knowing they had four weeks to find a solution!
Care About What You Do
The authors make the point that the only way you can maintain the commitment and passion needed to run a successful company is to do something that matters to you. Doing something you’re proud of is also a great way to attract loyal followers. They use the example of Vinnie’s Sub Shop in Chicago, stating that sandwiches are only sold in the mornings because, by the afternoon, the bread is no longer as fresh. More money could be made if they kept selling across the entire day, but the loss of pride from selling lesser quality subs is not a price they’re willing to pay, and their devotion to freshness is loved by their loyal customers.
Another suggestion put forward by the authors is to make a stand about what matters to you by picking a fight with an existing competitor – effectively positioning yourself as an antidote to whatever it is they stand for. Running a small coffee house is used as an example: if you see your establishment as a haven for individualists, position yourself as the anti-Starbucks. In so doing, you gain instant positioning in the minds of customers, and you have a great business story to tell. However, the point is made that it’s important not to let your competitors dictate what you do. Your focus must always be on what you’re doing, not what others are or have been doing.
Make It Unique
Finding your passion can be as simple as making a product or service that you would love to use yourself. The authors use the story of track coach Bill Bowerman to illustrate this point. He wanted lighter running shoes for his team, so he poured rubber into his family’s waffle iron and his invention became the famous Nike waffle sole. People generally expect great things from the products they buy, but not every promise made is delivered, leading to disappointment. Your product should be so simple and easy to use that it will meet and even exceed every expectation, and people will love it so much that they’ll tell their friends about it.
Success in what you do will lead to others trying to copy what you do, and your only defence against this is to make your product or service impossible to imitate. You do this by injecting it with whatever it is that’s unique to you. The example of Tony Hsieh, former CEO at Zappos, is used. His obsession with customer service became the guiding ethos of his company, and while competitors might have been able to sell the same shoes, they could never imitate his true devotion to excellent customer service.
Another important point made is that once you have a product that’s unique, and one that keeps customers coming back, you’re able to share everything you know without giving away any secrets that might create copycats. In the same way, a renowned chef can promote themselves by publishing cookbooks filled with their signature recipes, you can promote your company by sharing your valuable experiences and specialised knowledge openly. Many big companies remain so secretive about what they do that you can gain a genuine competitive advantage by actively sharing what you’ve learned.
Bigger Is Not Always Better…
To emphasise this point, the authors ask the reader to consider if elite schools such as Harvard and Cambridge ever think of expanding their campuses into other countries to be able to educate hundreds more people every year. It’s unlikely they ever do because they’re comfortable being the size they are, and you should be too. If you start small, you can stay off the media radar while you experiment with your business. An example given is the way Broadway musicals are tested in smaller cities before reaching New York, an approach you can use to test out different ideas.
Another benefit of being small is the ability to keep your entire team on the frontline interacting with customers. In this way, feedback is received first-hand and customer satisfaction remains everyone’s responsibility. However, if you want to build your business successfully, you need to remember that you are running a business, not just enjoying a hobby, and you need to have a clear path to profitability in mind from the outset.
… And Less Can Be More
The message here is that you can add value by deciding what not to offer. Gordon Ramsay and his Kitchen Nightmare TV show is used to great effect as an example. When he sets about fixing a restaurant that’s failing, he invariably begins by dropping around two-thirds of the dishes that are on the menu. The authors suggest the same approach can be an effective way to chisel away what’s merely good in your company to leave you with what’s great.
They point out that Ernest Hemingway wrote Nobel-winning fiction with very sparse language, indicating that it’s possible to make a great product or provide a great service with very few features. Instead of trying to get one-up on a competitor’s feature-heavy product, make yours simpler and more user-friendly instead. In the same way, an art gallery will only display a select few paintings, not every painting in existence, you need to cut out what’s unnecessary and vouch for what you have left – the stuff that matters.
As you become more successful and gain more customers, keeping your product or service simple isn’t always easy. More customers will lead to more requests for changes and developments, but the authors stress it’s important not to overreact to these requests by immediately modifying your product and adding every new suggested feature. Giving in to these requests would very quickly leave your product unrecognisable, quite possibly scaring away potential new customers. Saying no initially is the best approach, and if the requests really are important to customers, they’ll come up frequently enough to justify the change.
Be true to your small size and avoid falling into the trap of attempting to emulate big corporations. The authors believe this to be especially important in your marketing and communications. They use the example of overused, meaningless jargon such as “transparency is a cornerstone of your communications strategy” when all you really need to say is that you’re honest.
They add that in a small organisation, marketing is everyone’s responsibility, and every email, phone call, social media update, or blog post can be a means of deepening your bond with your customers. By sharing information they value, you’ll get their attention without the need for expensive marketing plans. The bond you form with customers will also help to see you through inevitable tough times. Being honest and authentic, and being upfront about shortcomings is a far better approach than sweeping things under the rug. Pseudo-apologies are never appreciated, and the authors ask the reader to consider what sort of apology they would like to hear if they were the customer.
Make Quick Decisions
One of the key advantages of being a small company is the ability to make quick decisions without getting caught up in bureaucracy. Instead of looking for the perfect solution, look for one that’s good enough and keep moving rather than bogging yourself down thinking about it. In other words, avoid over-planning and over-analysing.
The authors make the point that unless you have a crystal ball, estimates and plans are nothing more than guesswork, and following them blindly removes your ability to improvise and adjust quickly. Their suggestion is simply to wing it! Instead of making decisions far in advance, make them on the spot, and instead of planning ahead to next year, plan no further than the week ahead. Small decisions that work for the time being and can be reversed are much easier to make than big, life-changing ones that create long-term worries.
There are always potential downsides to every decision, but choose to make quick decisions rather than allow yourself to be held back by mulling over what might go wrong. Make decisions and deal with any downsides if and when they happen – most never will.
The authors offer the reader a wealth of information relating to building and running a business in what they believe to be a new, and much more effective, way. In addition to the points summarised above, they detail why productivity doesn’t follow long hours, and why hiring people should only ever be done when absolutely necessary. In short, the book lives up to its title by giving the reader everything they need to “rework” their approach to starting a business, and change the way they work forever.
The mix of thought-provoking points and practical examples offers the reader a highly digestible guide to starting and running their own business. The personal experience and positivity of the authors shine through in every word, and the message that there is a better way to work is received loud and clear.
Bio of the Authors
Jason Fried is the founder of 37signals, a privately held web-based software company internationally renowned for its innovative products that intentionally do less than the competition.
David Heinemeier Hansson is a computer programmer, creator of Ruby on Rails, an open-source web framework, and Jason Fried’s business partner at 37signals.
Rework: Change the Way You Work Forever by Jason Fried and David Heinemeier Hansson, 2010, ISBN: 978-0091929787 is available to buy at Amazon.