Kill the Office!: How to Make Remote Teams a Competitive Advantage
I have long been a proponent of remote work. For the past 4 years, I’ve had two bosses that were forward-thinking enough to let me spend significant amounts of time working abroad, and I’ve successfully filled both investing and operational roles from thousands of miles away.
While many were skeptical that it was possible to be efficient so far from home, the COVID crisis has challenged several of the anachronistic assumptions surrounding remote work. The maturation of video conferencing, cloud storage and project management platforms, as well as the advent of communication tools such as Slack and Discord, has caused people to realize that remote work is not only possible, but potentially better than the traditional paradigm. Indeed, dozens of companies, such as Facebook, Twitter, Square, Shopify, Box and Slack have all announced plans to transition to remote-first cultures, and research from Forbes has shown that distributed workforces:
- Are 35–40% more productive than their office counterparts
- Produce results with 40% fewer quality defects
- Have 41% lower absenteeism
- Have 12% less employee turnover
- Spend 21% less per employee
While these results are staggering, there’s potentially even a bigger reason to leverage a distributed workforce — the immeasurable benefit of being able to access the best talent in the world, no matter where they choose to live.
This is especially important as employee skillsets tend to cluster around certain geographies. For instance, I previously wrote an article in Business Insider that argued that Israel has been extraordinarily successful launching startups because of the high concentration of world-class engineers coming from the IDF’s prestigious 81 and 8200 units. Unfortunately, few of these companies reach or grow beyond unicorn status due to the relative dearth of “commercial” talent (e.g. growth hacking, branding, customer relations, strategy and business development) compared to Silicon Valley. With remote work, these problems will instantly vanish.
Unfortunately, remote working brings its own set of challenges. Since I’ve spent nearly half a decade trying to solve these challenges, I wanted to share what I’ve learned.
The Problem with Remote Work
A distributed workforce isn’t a panacea — it simply amplifies your current culture. If you have a strong organization, the benefits are clear; but if you don’t, remote work will magnify your existing weaknesses.
Three flaws that are particularly dangerous to remote teams are those listed by Harvard Business Review in its article 75% of Cross-Functional Teams Are Dysfunctional. These are:
- Misalignment of goals
- Lack of communication
- Unclear roles, responsibilities and decision-making authority
How to Make Remote Work “Work”
The secret to distributed work is disciplined management and a strong organizational culture. The same principles that apply to running an institution in person become even more important when your team is thousands of miles away.
While there are dozens of management philosophies and thousands of books on the subject, most theories distill down to a few simple disciplines. Of these, I’ve found that three principles are particularly effective when it comes to managing distributed work forces:
- Have a clear mission statement
- Use mOKRs (mission-driven OKRs) to enforce accountability
- Establish a meeting rhythm.
While the concepts listed above might seem basic to experienced operators, they are nonetheless very powerful. Proper application of these principles can provide the organization with direction, accountability and discipline and cure 80% of the potential problems that stem from distributed teams.
PRINCIPLE #1: MISSION STATEMENT
Unfortunately, like the amorphous idea of “culture”, many first-time entrepreneurs believe mission statements are antiquated, unnecessary or “too soft”. I can understand why, as many (perhaps most) are terrible — they‘re full of platitudes and abstractions, they don’t inspire or motivate and they are rarely read.
Still, discounting the importance of the mission statement is an amateur, and often fatal, mistake. That’s because a well-defined mission answers the critical question of “why” — uniting customers, employees and investors behind a shared purpose.
So the next time someone tells you that mission statements are irrelevant, remind them that they have been proven to:
- Catalyze Growth: Ernst & Young found that 58% of companies with a clearly defined purpose exceeded 10% growth in the trialing three years, while only 42% of companies without a clear purpose did so
- Spur Innovation: 63.4% of executives surveyed by the Economist Intelligence Unit believe that a strong mission helps them innovate and better respond to changing conditions
- Solidify Customer Loyalty: According to the Harvard Business Review 84% of executives believe that a clear purpose increases customer loyalty
- Increase Employee Satisfaction: Research firm Enso found that 68% of Millennials sought purpose at work vs. 42% of Boomers
- Drive Change: In his article “Corporate Mission Statements Don’t Really Matter, Unless You Want To Be A Great Leader”, Len Sherman details how executives from Lego, Starbucks, Schwab and Apple all used a clear vision to drive home of the most epic turnarounds in corporate history
- Improve Shareholder Performance: Raj Sisoda, in his book Firms of Endearment, found that companies with a clear sense of purpose outperformed the S&P 500 by a factor of 14x over a 15 year period
- Builds a Permanent Organization: Military protocols generally require all soldiers to understand the ultimate objective of a mission in case the leaders are killed or incapacitated. Similarly, companies that have a clear purpose can outlast changes in management
Indeed, as Simon Sinek points out in “Start with Why”, the efficacy of mission statements “is not opinion, it’s biology”. We are a social species by nature — we have an irresistible need to belong to something bigger than ourselves, feel safe in cohesive groups and naturally connect with those that have similar values and beliefs.
But with so many bad mission statements out there, how do you create a good one?
Step 1: Understand your Why
As Sinek insists, to succeed you first need to deeply understand your “why”. One tool that I’ve personally found very helpful to do this is the “hedgehog” concept from Jim Collin’s Good to Great.
Based on an ancient Greek parable about a fox and a hedgehog, the concept describes the importance of focus and mastery. While the fox is clever and employs many strategies to capture the hedgehog, the hedgehog always relies on the same defense — curling up into a ball and raising its spines. No matter how hard the fox tries, it’s constantly thwarted by this simple defense (often retreating with a nose full of spines).
Collins argues that the same is true in business, “hedgehogs” — companies that master one area — are successful, while “foxes” — companies that seek to succeed in every domain — end up scattered, diffused, unfocused and inconsistent.
To adopt the mindset of the hedgehog and determine your company’s “why”, ask yourself the following three questions:
- What are we deeply passionate about?
- What are we (or can we be) the best in the world at?
- What can we make money doing?
At the intersection of these three answers, you will find your purpose.
Step 2: Create a “First-Draft” Mission Statement
Once you have established your “why”, the next step is to get a bit more strategic and answer the “who”, “what” and “how”. There are dozens of business frameworks that can help you do this, such as the 3C’s, 4P’s or McKinsey’s 7S Framework, but it’s often as simple as answering the following three questions:
- What do we do?
- How do we do it?
- Whom do we do it for?
Coupled with your why, these answers will create the basis for a first draft of your mission, which often follows the formula below:
Our mission is to WHY by providing WHAT for WHOM through HOW.
Step 3: Revise, Discuss, Polish and Own
Once you have prepared your first draft, it’s time to start refining it.
Read the mission statements of great companies for inspiration, such as:
- Tesla: “To accelerate the world’s transition to sustainable energy.”
- LinkedIn: “To connect the world’s professionals to make them more productive and successful.”
- PayPal: “To build the web’s most convenient, secure, cost-effective payment solution.”
Share with your executive team and discuss, circulate to employees to get their feedback, even consider sharing it with some of your trusted customers.
Continuously edit to remove extraneous language, buzzwords, hype and hyperbole
Ultimately, there isn’t one formula for a great mission statement — you might choose to exclude the “how” or the “whom” and you may even add a “where” — what’s important is to have something that resonates with your team and your stakeholders. As such, it is highly recommended to invest the time and effort to truly make your mission statement your own.
PRINCIPLE #2: MISSION-DRIVEN OKRS (mOKRs)
At the risk of stating the obvious, accountability is one of the single most important elements fueling truly successful organizations. Properly designed accountability processes:
- Simultaneously reward excellence and correct underperformance
- Encourage “extreme ownership”
- Build organizational trust through transparency
- Eliminate the threat of micromanagement and empower team members
- Reinforce the company’s mission
While there are numerous methods and systems of creating accountability — Gino Wickman’s Entrepreneurial Operation System, Verne Harnish’s Rockefeller Habits, Dr. Robert Kaplan’s Balanced Scorecard, etc… — OKRs are perhaps the most popular owing to their recent success.
Unfortunately, OKRs suffer from one fatal flaw…
Limitations of the “Vanilla” OKR
Pioneered by Intel, popularized by John Doerr and used by Google, LinkedIn, Uber and Twitter, OKRs have long been the “secret weapon” of the Silicon Valley elite. Indeed, a recent study by Sears showed that the implementation of even basic OKRs led to an 8.5% increase in revenue and consistent use increased that figure to 11.5%.
OKRs follow the simple formula of:
They have become common practice in most successful startups because they help set clear goals, promote personal accountability, align the organization and enable more effective and informed decisions.
The one downside to traditional OKRs is that they only answer the questions of “what” and “how”, leaving out the all-important “why”.
Using the “Mission-Driven” OKR to Build a Purpose-Driven Culture
As stated above, having a strong “why” may be the most important driver of a company’s success.
So how do we add a “why” to our OKRs? Well, the answer is so straightforward, I’m almost embarrassed to say it.
You simply add your mission statement to your OKR:
Just as with OKRs, you can (and should) build an mOKR tree to cascade your goals throughout the organization and ensure that every employee has a metric.
As a reminder, traditional OKR trees start with company level objectives and flow down to the team and individual level. For example:
- Let’s say your company’s goal is increase your cash flow to $10M. To make that happen, you’ll need to: 1) grow your user base by 50%, 2) increase your ARPU to $250 and 3) increase your FCF margins by 20%. These become your company level key results.
- Each of these company KRs will be assigned to a department and then become that department’s objective. In this case, the marketing department’s objective is to grow the user base by 50%.
- Now that you have your departmental objectives, you can set departmental KRs. For marketing these could be: 1) increasing site visits by 25%, 2) increasing the visit to trial signup rate to 10% and 3) increasing the trial to paid conversion rate to 10%.
- Following the same process, the individual teams will use the departmental KRs as their objectives. For instance, the customer acquisition team might use “increase site visitors by 25%” as their objective.
- Similarly, the team would then set KRs for to accomplish the objective of increasing site visitors such as: 1) Release 4 blog articles per month, 2) increase paid advertising CTR to 5% and 3) increasing the open rate of the newsletter to 30%.
- These new KRs, become — you guessed it, the objectives for each team member. So Bob might be responsible for releasing the blog articles and Sally might be responsible for increasing the paid advertising CTR.
When complete, you’re going to have something that looks like this:
To turn this OKR tree into an mOKR tree, just add your mission to each of these steps. This will make your purpose:
- Transparent: As the mission is now part of the OKR, it will be almost impossible to ignore or forget
- Universal: Everyone in the company should have an objective that ties directly to the mission
- Aligned: The employee’s objectives align with the team’s objectives, the team’s objectives align with the company’s goal and the company’s goal is tied to the mission
- Ubiquitous: You should be tracking everyone’s progress on their mOKRs (i.e. how each person is helping the company achieve its mission) and posting this information everywhere — in your weekly report, on monitors around the office, etc…
- Ingrained: Repetition breeds internalization, and your employees will be reminded of the company’s mission (and by extension, their mission) on a daily basis
Again, while it’s a simple addition, the effects will be profound, as the mOKR will weave the “why” into the fabric of your culture and help you build a powerful, purpose-driven organization.
PRINCIPLE #3: MEETING CADENCE
Over the last several years, there’s been a strong backlash against meetings in the workplace. Employees complain they take up too much time, pundits argue that they’re useless and managers believe they come at the expense of “real work”.
These are all very valid concerns, as most meetings are a complete waste of time and resources. According to the Muse:
- 15% of an organization’s time is spent in meetings
- Unproductive meetings waste more than $37 billion per year
- Workers can spend up to 4 hours a week in preparation for even a simple status meeting
- Executives view more than 67% of meetings as failures
- 92% of workers surveyed admitted they multitask in meetings
- 69% check their email during meetings
- 4% of people multitask during video calls while 57% multitask during phone calls
But the fact that most meetings are bad does not mean that all meetings are bad, and there’s actually a certain type of meeting that reduces overall meeting time!
‘Good’ Meetings vs. ‘Bad’ Meetings
In High Output Management (one of the best management books ever written IMO), Andy Grove outlines two distinct types of meetings:
- Process-Oriented Meetings: Meetings held on a regular basis (e.g. staff meetings, operational reviews, 1:1s) that are designed to share knowledge and exchange information
- Mission-Oriented Meetings: Ad-Hoc meetings that are designed to accomplish a specific task and / or make a specific decision
Done correctly, Process-Oriented meetings tend to be “good” meetings because they provide managerial leverage — that is, by investing a small amount of their time, leaders can unlock exponential value in their teams, by either influencing a large number of people, communicating key information, removing roadblocks or providing key insight. In short, Process-Oriented meetings use ONE person to solve MANY problems.
Mission-Oriented meetings, on the other hand, are often what we imagine when we think of “bad” meetings. They are borne out of frustration and often called because one person doesn’t have the knowledge or information to solve the problem they are dealing with. In short, Mission-Oriented meetings use MANY people to solve ONE problem.
The great irony is that too few Process-Oriented meetings often lead to too many Mission-Oriented meetings. If employees don’t have the correct information, they’re forced to call together groups of colleagues to debate even the most basic of questions.
Establishing a Meeting Rhythm
The best way to get in the habit of Process-Oriented meetings is by establishing a “meeting rhythm” — a pre-scheduled slate of recurring meetings with defined agendas.
Doing this will not only save you time and reduce hassle (by removing the logistical nightmare of constantly having to coordinate schedules), but will also yield the following benefits:
- Action: Good meetings should always end with a “Decision Action Plan” that outlines a) what you will do, b) who will take responsibility for doing it and c) when it will be done
- Alignment: Well-executed rhythms will improve your team’s focus, reinforce your “why” and remove all doubts about what is most important to your organization.
- Communication: They keep everyone informed and up-to-date on critical developments
- Connection: Good cadences will keep people engaged, provide a sense of structure and maintain a positive working environment
- Accountability: Employees are held accountable for their performance on a weekly (or even daily basis), fostering a “sense of urgency” throughout the organization
- Kaizen (Constant Improvement): Similarly, the constant accountability of a strong meeting rhythm also provides the opportunity for constant feedback, coaching and employee growth (vs. the antiquated “yearly performance review”)
- Problem-Solving: Teams get in the habit of frequently uncovering and solving issues, weaving a problem-solving mindset through the fabric of your culture
While there are many potential meeting cadences, I have personally found that implementing a series of seven recurring meetings across strategy, tactics and execution will get you 80%-90% of the way to achieving your goals.
You will note that these meetings “cascade” — goals are set at the yearly and quarterly strategic meetings and implemented at the weekly tactical and daily execution meetings.
Meeting 1: The Strategic Offsite
Strategic meetings are broken into two buckets, the annual offsite to set the overarching company vision and strategy and the quarterly “check-in”, where the strategy is tweaked based on prior performance and new market information.
The most effective annual meetings separate the executive team from the day-to-day of the business and are often held at a 3 day “offsite”. These meetings should address the following questions:
- Annual Retro: Why did we achieve / fail to achieve our goals?
- Culture: What are our cultural values? Are we adhering to these values? Why or why not?
- Mission: What are we doing? What is our BHAG?
- Competitive positioning: What are our strengths, weaknesses, opportunities and threats (SWOT)? How are we positioned via competitors?
- Goals: What are our 1-Year goals?
- Accountability: Who is accountable for what?
- OKRs: What are our Q1 goals / OKRs? Rocks? KPIs?
- Budget: What is our Q1 budget?
Meeting 2: The Quarterly Business Review (“QBR”)
Quarterly meetings generally last one day and are often bite-sized versions of the annual meeting. They ask: 1) Are we on track for BHAG, 3-Year and 1 year goals?, 2) If not, what changes do we need to make? 3) What are our goals / OKRs, Rocks,KPIs, etc… for the Quarter? 3) What is our budget for this quarter? 4) Whom do we need to hire? 5) Who is not performing (or not a cultural fit) and what can we do about it?
In extremely high or “hypergrowth” companies, the QBR can even be held on a monthly basis.
Meeting 3: Weekly Department Meetings
Tactical meetings fall into two buckets — the weekly meeting and weekly retro.
Weekly meetings are the engine that creates a “sense of urgency” in your organization. They focus on tracking results, measuring progress towards your goals, addressing key issues and making important decisions. Because these meetings are attended by both executives and members of the team, they can serve as a great venue for removing blockers and resolving pressing issues on the spot.
One great template for weekly meetings comes from Gino Wickman’s Traction. He calls them “Level 5 Meetings” and they are designed for maximum impact in the minimum amount of time (i.e. less than 90 minutes).
Level 5 meetings include all stakeholders of a team and cover the following:
- Each business unit reports on customer highlights and shares good news (5 min)
- Reporting by business unit (15 min): Review scorecard (are metrics “on-track” or “off-track”?) and review rocks (are rocks “on-track” or “off-track”?)
- Review last weeks to-dos (5 min)
- Set upcoming to-dos (5 min)
- Discuss issues (60 min)
- Create a “Decision Action Plan” (what are we doing / who owns it / when is it due) and update to dos accordingly (5 min)
For a more detailed overview of these meetings and the terms above, I’d highly recommend you check out Wickman’s book.
Meeting 4: Weekly Retro
Just as important as the weekly execution meeting is the weekly “retro”. Influenced by the Japanese concept of Kaizen, the goal here is continuous improvement.
The best practice for a retro is to gather a cross -functional team to see problems from different angles and:
- Identify Problems: Review and benchmark your metrics to see what isn’t working
- Understand Causes: Use a combination of proven business frameworks (e.g. Porter’s five forces, PESTLE, McKinsey 7S) and root-cause analysis techniques (e.g. “5 Whys”) to understand why metrics are lagging
- Solve: Brainstorm solutions as a team
- Check: Review your proposed solutions for cognitive biases
- Act: Create a “Decision Action Plan” that answers: What are we doing? Who is responsible? When will it be done?
Weekly retros are especially important in sales & marketing departments, as constant analysis and refinement of funnel metrics is crucial to long-term success and the ability to stay competitive in fast-paced markets.
Meeting 5: Daily Standup
Execution-focused meetings occur very frequently and serve as the “engine” of your business.
The first type of execution-focused meeting is the daily “standup”. Although popularized by engineers using the Scrum methodology, leaders ranging from John D. Rockefeller, to Steve Jobs to the Ritz Carleton have successfully used this method to inform and align the team on a daily basis.
Daily standups are very short — 15 minutes is the optimal length — and have every member of the team answer the following three questions:
- What I did yesterday
- What I’m doing today
- What is blocking me
Meeting 6: 1:1s
Perhaps the most important piece of the puzzle is the weekly 1:1s you hold with your team. These meetings should never be skipped, as they provide the ultimate in managerial “leverage” (i.e. 30 minutes of your time can unlock a week of value for someone else).
There are a couple different schools of thought when it comes to 1:1s. Andy Grove believed that the employees should dictate the agenda, while Bill Campbell preferred to follow a framework.
If you are the type that likes to follow a framework, I’d recommend the one outlined in Trillion-Dollar Coach:
- Job Performance (e.g. Are you hitting your numbers?)
- Peer relationships (e.g. Are you getting along with your peers?)
- Management (e.g. Are you having problems with any of your direct reports? What are you doing to support your team?)
- Innovation (e.g. Are you building space for innovation? Do team members come to you with new ideas?)
If you’re going to follow Andy Grove’s advice and let the employees dictate the agenda, remember that some people can be reluctant to ask for help. As such, I recommend having a set of “back pocket” questions that can warm up the conversation if it gets stale. Some examples I’ve used in the past are below:
- Who in the company do you admire and would you like to learn from? What do you want to learn?
- What’s an area of your work you want to improve?
- What could I do as a manager to make your work easier?
- If you were CEO, what’s the first thing you’d change?
- Are there any aspects of our culture you wish you could change? What are your favorite parts about our culture?
- Which company values do you like the most? Which the least? Why?
- How could we be more creative or innovative as a company?
Meeting 7: Weekly All-hands
Good all-hands meetings are a great resource for improving company culture — they can drive transparency, create alignment and build esprit de corps.
While it’s up to you to decide what’s right for your organization, I’ve historically held all-hands meetings on a Friday afternoon, and tried to keep them relatively “up-beat” by sharing:
- Key wins, good news, customer headlines, etc…
- Management praise for employees that have done a great job upholding the company culture
- A financial update (e.g. cash & runway, budget vs. actual, budget by category, budget by department)
- Competitor, customer and supplier trends
- Important updates to the team (e.g. welcoming new members)
- Review of departmental metrics across PR, marketing, sales, ops, product & engineering, IR, HR, etc…
- A departmental “show and tell” (this is great to see what engineering has been working on)
- An “open” AMA where anyone can ask management anything
- An anonymous AMA using (I used suggestionox.com)
- “Shout-outs” where anyone can praise anyone else on the team for a job well done
Is this too many meetings?
A common argument against the implementation of a meeting cadence is that “we don’t need more meetings” — that meetings are wasteful and prevent the team from doing “real work”.
Again, this is an amateur mistake that:
- Highlights a misunderstanding between the two types of meetings outlined above (i.e. process-oriented meetings that save time and mission-oriented meetings that waste time)
- Ignores the importance of knowledge sharing and communication (as a mentor once told me “if you are “anti-meeting” then you are “anti-communication”)
- Is frequently not grounded in reality, as the entire cadence actually “costs” you less than 10% of your employee’s time (and is the investment of a few hours worth it to provide leverage to the other 90%?)
Experienced managers know that “process” is not a dirty word and is critical to the growth of a company and happiness of its employees. To borrow a phrase from ex-Navy Seal and management guru Jocko Williink, “discipline equals freedom” — it improves communication, prevents micromanagement, saves you time and can catalyze exponential growth.