The Hard Thing About Hard Things

The Core Challenge

“There is no formula for dealing with hard things.”

Conventional wisdom can be worse than knowing nothing. The hard things are the decisions no one teaches you—layoffs, firing executives, building culture under pressure.

Peacetime vs. Wartime Leadership

Peacetime CEO:

• Maximizes opportunity
• Encourages broad creativity
• Sets big hairy audacious goals

Wartime CEO:

• Focused on single bullet in chamber
• No time for management books
• Immediate decisive action required

Different situations require completely different leadership approaches.

Three Attributes of Great Leaders

1. Steve Jobs Attribute: Ability to articulate compelling vision, even when things fall apart
2. Bill Campbell Attribute: Genuine care for team’s interests over own success; low ego
3. Andy Grove Attribute: Execute the vision and achieve it, even at massive cost

Building and Managing People

“Take care of the people, the products, and the profits—in that order.”

• Good organizations let people focus on work confidently
• Poor organizations waste time on politics and broken processes
• Good culture is the difference between survival and collapse when things go wrong
• Only like a job when it’s meaningful—financial need alone won’t keep best employees

Management Principles

• Most managers won’t train employees, but training is the manager’s job
• Command respect when firing executives—let them keep dignity
• In human interaction, required communication is inversely proportional to level of trust
• Healthy culture encourages sharing bad news openly and frequently

Managing by Numbers vs. Reality

• Managing purely by metrics is an amateur approach
• Some important goals aren’t quantifiable
• Focusing only on numbers misses critical qualitative objectives
• Management debt compounds: one bad decision creates precedent that will plague you

Political Culture Prevention

• Apolitical CEOs paradoxically create most political organizations
• Create incentives for merit-based advancement, not political maneuvering
• “The squeaky wheel gets grease” teaches wrong values—reward merit, not requests

Executive Hiring and Scaling

• Peter Principle is unavoidable—you can’t know at what level someone becomes incompetent
• Law of Crappy People: Talent converges to level of worst person with that title
• Big company execs need 8-10 new initiatives/day in startups
• Value specific expertise over lack of weakness when hiring executives

Organizational Design

“All organizational designs are bad.”

Choose based on communication priorities. Communication, common knowledge, and decision-making become major challenges during scale.

Critical Insights on Culture

• CEO must stop being too positive—be honest about problems
• Share every burden you can; get maximum brains on existential problems
• Most important CEO skill: managing your own psychology and fear
• Courage isn’t lack of fear—it’s doing right things despite fear

“The Struggle is where greatness comes from.”

“In any human interaction, the required amount of communication is inversely proportional to the level of trust.”

“My single biggest personal improvement as CEO occurred on the day when I stopped being too positive.”