Success:
And, as I would learn later on in my life-at Salomon Brothers and in my own company-it’s the “doers,” the lean and hungry ones, those with ambition in their eyes and fire in their bellies and no notions of social caste, who go the furthest and achieve the most.Entrepreneurship:
Life, I’ve found, works the following way: Daily, you’re presented with many small and surprising opportunities. Sometimes you seize one that takes you to the top. Most, though, if valuable at all, take you only a little way. To succeed, you must string together many small incremental advances-rather than count on hitting the lottery jackpot once.
I have always believed in playing as many hands as possible, as intelligently as I can, and taking the best of what comes my way. Every significant advance I or my company has ever made has been evolutionary rather than revolutionary: small earned steps-not big lucky hits.
Young people starting their careers today are too impatient for current compensation, at the expense of continuing their education and giving their jobs a chance. Get back to work. Forget the money today. There’s plenty of time for that later. Novices should go to the best firm they can get into-and then shut up and learn those few things they don’t happen to know already.
The difference between stubbornness and having the courage of conviction sometimes is only in the results.
Letting them define the rules is a sure way to come in second.
Work doesn’t expand to fill capacity-opportunity does!
Thinking and interpersonal communications skills have been, are, and will be keys to survival. Technology’s not going to change that. To prosper, work on your people-to-people relations more than your typing speed. Take a psychology course and one on how to use the Scientific Method rather than (or in addition to) a computer science course.
Being well-rounded, inquisitive, perceptive, logical, and communicative is more valuable than knowing a given sequence of buttons to push. In the future, technical details will matter less-big picture, more.
Our schools too often fail to teach logic and skepticism.
Forcing your children and proteges to go solo-and leaving them alone while they struggle as adolescents with relatively simple problems-is something parents and mentors must do. It’s not easy, but it’s necessary if they’re to survive later on their own.
Having a business career and raising a family create inherent conflicts. Investment of time is the primary controllable determinant of success in both.
Repetition builds instinct. I’m living proof. And preparation. I subscribe to the expression, “Stay ahead of the plane.” It basically means, “Do things now while you have the time, so you don’t have to later when you’re rushed.”
It’s always the little things that buy you a slight extra margin, that in turn saves your rear.
Three things usually separate the winners from the losers over the long term: time invested, interpersonal skills, and plain old-fashioned luck.
We just did what all great salespeople do: We presented everything we had, and then highlighted whatever facts enabled customers to convince themselves they were getting a good deal.Planning
From John D. Rockefeller to Sam Walton (and ultimately to Mike Bloomberg, I hope), great financial success comes from starting businesses with concrete products in the real world, building jobs, creating value, and helping people.
Planning has its place; the actual thought process sometimes leads to great new ideas. But you can only accomplish what’s possible when you get there. Then, whatever your idea is, you’ve got to do more of it than anyone else-a task that’s easier if you structure things so that you like doing them. Since doing more almost always leads to greater accomplishments, in turn you’ll have more fun. And then you’ll want to do even more because of the rewards.
What did I have the resources, ability, interest, and contacts to do? I could provide a far more sophisticated system at a fraction of the price. Sharing expenses over many users would give me a distinct cost advantage. And if most firms used my data and analysis, I would be creating an industrywide standard, something which, for competitive reasons, the insiders themselves could never accomplish.
If you’re going to succeed, you need a vision, one that’s affordable, practical, and fills a customer need. Then, go for it. Don’t worry too much about the details. Don’t second-guess your creativity. Avoid overanalyzing the new project’s potential. Most importantly, don’t strategize about the long term too much
Consider banks and venture capitalists your worst enemies. They create doubt in entrepreneurs’ minds with their insistence on detailed game plans before they lend..
Selling is the only process we run simultaneously with development from the start. That gives us feedback as we build-and makes the customers part of the evolution process (they come to believe it’s their product)
By the time our rivals are ready with wires and screws, we are on version No. 10. It gets back to planning versus acting. We act from day one; others plan how to plan-for months.
From the beginning, I was convinced we were doing something nobody else could do. Nor was anyone else trying
Bloomberg found niches that Dow Jones and Reuters news didn’t fill. From the start, it was easier for us to add to our basic product what they provided, than for them to add what we built to theirs.
If you have to compete based on capital, the giant always wins. If you can compete based on smarts, flexibility, and willingness to give more for less, then small companies like Bloomberg clearly have an advantage. The world changes every minute, and you forget that at your peril.
Those enterprises that see new needs and react more quickly, win!
With every product, the greater its utility, the easier it is to use, the cheaper it costs-the more it’ll be used.
Dealings with a large, single-source supplier are always difficult to end. The seller invariably has back-door channels into its customer, which it can use to thwart change. The buyer fears the uncertainty of the new and mentally tries justifying the known devil. People feel threatened by the normal reexamination of practices that vendor-switching invariably instigates
I’ve always insisted on building a simple “do a few things” version of software up front. Most people are terrible at understanding and enunciating what they actually do day in and day out, and on what basis they make decisions. They’re even worse at defining what tools they would use in the future. But if you give them something they can see and touch, then both they and you can get experience as to a program’s utility and applicability, or at least have a common basis for enhancements.
Buyers won’t accept more complexity, change for change’s sake, or so many options that no normal person could possibly remember them without the multilanguage, tiny-print, incomprehensible instruction book on hand.
The junkyards are littered with examples of technology that were introduced simply to highlight the designer’s brilliance but ignored the customer’s capabilities and needs.
When is diversification appropriate? Only when it fits with what you already do.
Lack of competition is the equivalent of no peer review process. When the inevitable competitor arrives with a better way, the organization previously without a need to improve has grown so lazy it has trouble reacting.
Positioning ourselves to respond is what competition is all about, we have to enter each commercial fight with an advantage. I don’t believe that business battles should be even.
If that were the case, the odds wouldn’t be good for a company our size. Remember the math: The chance of coming out ahead in a fair contest is one in two. In consecutive tests, that chance becomes one in four, one in eight, one in sixteen, and so on. In other words, the likelihood that we will prevail five times in a row in a fair fight is only about 3 percent. That’s not a risk a small company like ours can afford to take. We don’t want fair fights. We want to go into contests with an advantage
Plan things out and work through real-life scenarios, selecting from the opportunities currently available. Just don’t waste effort worrying about an infinite number of down-the-road possibilities, most of which will never materialize.Management
As you discover you don’t know it all, force yourself to address the things you forgot, ignored, underestimated, or glossed over. Write them out for a doubting stranger who doesn’t come with unquestioned confidence in the project’s utility-and who, unlike your spouse, parent, sibling, or child, doesn’t have a vested interest in keeping you happy. Make sure your written description follows, from beginning to end, in a logical, complete, doable path. By now, you either know what you can know-or you don’t and never will. As to the rest, take it as it comes.
We had picked just the right project. It was big enough to be useful, small enough to be possible. Start with a small piece; fulfill one goal at a time, on time. Do it with all things in life.
But generally, projections regarding new, untried businesses are meaningless. The noise in the assumptions you have to make is so great, and the knowledge you have of strange areas so limited, that all the detailed analysis is usually irrelevant. We saw a need. We went ahead and filled it.
Generally though, deep pockets and strong stomach help when trying new things. Few innovations are accepted right away. You must bring changes along slowly, improving them over time, building an audience with persistence and repetition.
Companies in the end need direction, not discussion.
They study. They plan. They work toward getting consensus and approval and closure. They try to define it all up front, even specifying the end game from the beginning. Ridiculous! You can do a six-month software project in twelve months. You can probably do a twelvemonth project in two years. You cannot do two-year project, ever. Humans need to see results in time frames they can handle. A project takes too long when it consumes so much time to build that no one remembers who requested it, what specifically was ordered, what its purpose was, or even whatever happened to that since-departed person who initiated all this.
Describing the “how and when” forces them to face all those things they initially glossed over when they thought about the “what”-utility, cost, maintenance, data quality, redundancy, training, cooperation. They have to satisfy me, a novice.
Well-run organizations, whether commercial, political, educational, military, or philanthropic, have conceptual goals stated long in advance.
Journalists generally make lousy managers in the same way that lawyers, accountants, and consultants are sometimes better at advising than doing. Each of these professions requires great skill in gathering a bewildering array of information and providing the customer with an assessment of what it means. The very skills required to research and produce a discriminating, specific piece of analytical prose day in and day out are probably antithetical to the skills required to keep people working together.Online News Business
We don’t appoint a manager at the beginning. We simply throw everyone interested into the deep end of the pool, as it were, and stand back.It becomes obvious very quickly who the best “swimmers” are. We just watch who people go to for help and advice. And later, when we formalize a management appointment, no one’s ever surprised.
We get more from each person by reducing the drudgery and enhancing creativity.
The leverage we gain from employing creative people and letting them do their own thing is incredible.
At Bloomberg, all we ask is that they come up with as many new ideas as they can think of (no matter how “crazy”), and do their best on the projects we assign. If a concept is flawed, the blame and pain rest with me. The credit for whatever’s right goes to them…
I’ve always thought titles are disruptive at best. They separate, create class distinctions, and inhibit communications.
We always have our offices in the best and most expensive parts of town while our competitors look for bargain space in the low-rent districts. It gets back to who you think is more important: your people or outsiders. I believe our people matter.
We handle perks differently, too. At Bloomberg, as you move up the organizational ladder and your compensation increases, you aren’t expected to work less and take more vacations. Quite the contrary. You’re more valuable, you get paid more, and your coworkers should get more out of you.
The increase in your compensation is for current and future services, not rewards for past performance. Don’t want to commit to that? Then don’t accept the promotion and raise.
No matter what their medium, most firms selling information electronically have a hard time generating profits. On the expense side, creating content is costly and labor-intensive. On the revenue side, access to “data on demand” (whether sophisticated mathematical analysis or trivial entertainment television), means more fragmentation of audiences over vastly greater “program” choices.The Software Business
On the Internet, few receive revenue in excess of expenses. With broadcast media, increased capacity (e.g., more channels, alternative distribution methods) is starting to cause the same effect (reducing audience size and revenue per show).
What’s required for success in these businesses? Why do some companies like Bloomberg, charging $1,100-plus per month for electronically delivered information, keep growing when others attempting data sales on the Internet can’t keep customers even when charging only pennies, or, for TV via cable, find great subscriber price sensitivity? Simple: supply and demand. If you’re not providing something unique, you have no ability to impose charges.
Most TV programs are just copies of earlier successful shows. No uniqueness: too much supply. Then there’s the question of utility. Whether it’s television sitcoms or hecklers on-line, most entertainment programming is only marginally more desirable than other alternatives or no programming at all. (The definition of entertainment is just that-nice but not necessary.) If there’s no great value added, the public’s smart enough to find alternatives like reading a book, watching something else, or going to bed. No great need: low demand. Much supply, little demand equals low prices.
As happens time and time again in this world, distribution changes rapidly. Content evolves slowly with cultural advancement. Creative people become even more valuable as their reach increases over difficult venues. The more choice the reader/listener/viewer has, the more demand there’ll be for Bloomberg’s product-independent, quality journalism-and the more important it is to fight the credentials battles everywhere in the world whereaccess is denied to the people’s only true representative: the free, unfiltered, intelligent, investigatory press. The message that content rather than the medium is king massages just fine.
Solve a few technical distribution problems and the number of newspapers will skyrocket as well. But the circulation of each, just as with the audiences for specific radio or TV shows, will decline as consumers’ choices expand.
A rule of thumb in software is that 90 percent of the costs go into building the last 10 percent of the functionality. Successful design and implementation demand the political skills and courage to reconcile the 100 percent specification needed for approval with the slightly-less-deliverables that are possible. As I found out at Salomon and again with the Bloomberg terminal, you promise users everything; then you build what you can, and what you think they need. It’s the only successful strategy for a systems developer.
No wonder these Chief Information Officers (CIOs) have a very short life expectancy. In reality, their technical knowledge isn’t valuable in supplying the function they are hired to provide. Knowing the company’s products, competitive position, accounting, marketing, and personnel policies is what’s critical to success for any CIO; that knowledge, along with leadership, business acumen, and hands-on management, is what’s needed.
Size’s economics of scale are seldom realized. Take the great misconception in our business about software: that maintaining a program is cheaper than developing it. It isn’t. The fact is, software needs to be updated constantly to retain value. The inputs to it change. The hardware and communications change.
People always need new formats, sorts, fields, and calculations. That’s why we constantly hire more programmers. Or what about the belief that hardware is a one-time “capital expense”? People always say something costs N to buy (a cost they “capitalize”) and then assume that’s the whole cost. I always figure on 40 percent of N every year, forever (a cost you expense versus earnings)- 10 percent interest, 10 percent maintenance, 20 percent depreciation. That adds up to 40 percent in my book. Don’t quibble with details.
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