A new CEO of a virtual company asks when to invest in technology platforms. Cameron Herold says use free tools first, delay custom builds until revenue justifies them, and force teams to adopt minimum viable everything. He gives a 12-month rule: IT finds 12 free tools before buying or building anything.
Chapters
We run a fully 100% virtual company. I'm a new CEO in it and one of the things I'm trying to do is simplify, right, and streamline as much as possible. But we're on a growth trajectory where we're starting to break things. And I wondered if you had experience or rules of thumb for more technology and what some of the platforms that you've been using in the past of when to truly invest in a platform or when can you push it, you know, another year. And whether or not, you know, when you start breaking things, it's too late, right? So you want to be ahead of it, but also don't want to invest all your profit into just technology.
Great, great question. I just dropped something actually in the chat that I was sharing with a CEO alliance member yesterday. And it's some of the great rules that Apple leveraged to become really as strong as they are. But they've leveraged the principles around simplicity, right? They have fewer words and fewer products and fewer up like they really get down to the critical few things in every single area. Take some of those ideas and bring them into your business for sure. Around the technology question, years ago I had a friend of mine, a CEO, and he sat down with his head of it and he said, for the next 12 months. So almost like a January discussion, for the next 12 months, the IT team is not allowed to build anything. You're not allowed to buy anything. I need you to find 12 free software solutions to plug into the company that will eradicate 12 expenses that we currently have. So either needs to save us money or save us time. And we need to get it for free. And you're not allowed to build a single product. It's, you know, IT people like to build stuff, right? They want to integrate things. But the reality is often we don't need everything to be massively integrated. We just need something that works. That's simple, because momentum will create momentum. And if we can focus on growing revenue and growing gross margin, we can then take that revenue and gross margin later to build the better machine or the better mousetrap or the ideal software solution, right? So how can we plug in some of the stuff that's good? So it's teaching, it's teaching the employees that momentum creates momentum. I think we've all heard that saying that about the minimum viable product. My concept is really more minimum viable everything. How do you get it done and get it out the door so that momentum creates momentum? Because there's not a single problem that exists That a check can't solve, right? That you can buy your way out of any problem, but you can't build your way out of every problem. And often I've heard of people talking about infusionsoft. Well, the nickname for infusionsoft is confusionsoft. I've heard of people talking about leveraging and putting Salesforce into the organization. But almost every single case they don't just get to use the software. They now have to hire a consultant to, to have them help them use. Like it just starts to get very complicated for no reason versus using something that's much simpler, that maybe doesn't do everything, but the reality is we don't need everything. And then lastly, give the example of most of the software that we use. We don't use 95% of the damn features anyway. You know, like think about Microsoft Excel for an example. How many of the features and functions and stuff that's there do we, we only use 10 or 20 things. We could have a piece of software that only does the 10 or 20 things and it could be free or very, very cheap and very easy to use and it would be good enough for 99% of our use cases. And I think we often get bogged down like the stuff in our home, right? Like how many buttons do we use on our microwave? What do we do? We reheat pizza and we reheat food and we boil water. We don't need the other 97 functions. I don't need my washing machine to connect with my phone over wi fi because we don't use a damn feature anyway. So I think it's really leveraging what I put into the chat, those 10 principles around simplicity and forcing our team to think that way. Another point around this, I was speaking with a COO alliance member about this recently and it was that every mid level manager or early stage manager that really doesn't have the wisdom of having led people before, their answer to every problem tends to be hire more people because they don't think about optimization or automation or saying no. So the way that they tend to scale everything is add more people. Add more people. Well, if you're in India, I've got a client in India, whenever they have a problem, they hire 10 more people. Because every person's only 4,000 or 5,000 a year, that's fine. But when one employee is 80 or 90,000 a year, you can't keep throwing a person band aid at the problem. So we need to grow our people and invest in their skills as leaders. So that they actually have the skill set to be able to scale a business without throwing more people and thus more complexity at the problem.
