6. Plan for Success
But if you do look ahead successfully and see what the market wants, you will only create new problems. During 1983, for example, 3Com was in the tornado for exactly this reason: We had ignored our customers and salespeople and guessed right about what the market would want-Ethernet for personal computers. In the third quarter, we grew 85 percent in three months, which almost killed the company. We sold much more than we could deliver, leaving a backlog of unsatisfied customers for our competitors to unhook. We didn’t have enough people to answer all our customer support calls. Our production programs slipped behind schedule.
I remember our CEO, Bill, saying we would never grow that fast again. But I pointed out to Bill that Compaq had the year before gone from zero to 10 times our size in one year. Our problem was not that we had grown 85 percent in three months. It was that we had planned to grow only 15 percent. Which is to say that you can plan too conservatively. (I hasten to add that if you have to err on one side or the other, it is better to plan conservatively. Just don’t overdo it.)
7. Be an Entrepreneur, Not a Visionary
In 1982 my board of directors starting calling me a visionary, and I ate it up. Next thing I knew, I wasn’t CEO anymore. Turns out, nobody wants visionaries running companies. At my level of the game, being called a visionary was faint praise.
Here’s the difference between a visionary and an entrepreneur. Both have visions, which are a dime a dozen. But an entrepreneur has, in addition to visions, plans. In addition to plans, actions. You might have heard that 80 percent of winning is just showing up. Well, showing up is an action, like taking that wake-up call in the dark in the Ramada Inn in Schenectady. I wouldn’t touch a visionary with a 10-foot pole.
Being a company’s proud founder is also foolish. As they build their companies, many people walk around saying to their employees, “I am the founder and you’re not.” You want every employee of your company to be a founder. To have and therefore feel ownership.
8. Know Your Own Operating Range
In 1990, I “retired” from 3Com exactly 11 years after incorporating it. I should have gone three years earlier. Twice the board of directors chose someone other than me to be CEO of 3Com. In 1982, when I didn’t flounce out the door, but instead got sales and marketing. And again in 1990, when I retired amicably.
Putting together the board of 3Com was one of my proudest accomplishments. I built that board with the best people I could find. When they decided someone else was better qualified to be 3Com’s CEO, who was I to argue? Both times, in retrospect, they were right. By 1990, 3Com had outgrown me. Fortunately I had a board smart enough to know that I had succeeded in moving 3Com out of my own operating range. You should be so lucky.