title: [Book Sharing] What's the Hardest Thing to Manage - Silicon Valley Venture Capital King Tells You Real Management Wisdom
published: false
date: 2021-06-25 00:00:00 UTC
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canonical_url: http://www.evanlin.com/reading-hard-things/
---
[](http://moo.im/a/7adFLM "What's the Hardest Thing to Manage")
What's the Hardest Thing to Manage - Silicon Valley Venture Capital King Tells You Real Management Wisdom
The Hard Thing About Hard Things : Building a Business When There Are No Easy Answer
Original Author: Ben Horowitz
Translator: Yu-Te Lien
Publisher: Commonwealth Publishing
Publication Date: 2018/10/24
#### Book Purchase Recommendation Websites:
-
E-book: [Readmoo](http://moo.im/a/7adFLM)
-
Books.com.tw: [Purchase Link](https://www.books.com.tw/exep/assp.php/kkdailin/products/0010802878?sloc=main&utm_source=kkdailin&utm_medium=ap-books&utm_content=recommend&utm_campaign=ap-202106)
## Preface:
This is the eighth book I've read this year. The author, Ben HorowitzP, is one of the founders of Andreessen Horowitz (commonly known as a16z) and a well-known entrepreneur. In addition to having his own media platform, he is also the author of many books, and this book shares the author HorowitzP's experience as a CEO. It mentions many days when entrepreneurial executives couldn't sleep because of money, and how they brought the company back to life after layoffs (the author has experienced several). This book doesn't show the glamorous side of a CEO; instead, it shows the sleepless nights, self-doubt, and challenges from the board of directors and investors. It's quite realistic!
And it includes many ways to select excellent sales managers, the process of communicating layoffs, how to conduct 1-on-1 communication, and how to make difficult decisions as a CEO. I think these processes are not mentioned in many standardized books. If you also want to understand these processes, read this book!
The first three chapters describe how the author managed the cloud company Loudcloud, sold it to EDS after going public, and spun off the cloud operating system into a new company, Opsware, eventually making Opsware the industry leader and selling it to HP. The later chapters explain many details of being a CEO.
## Content Summary and Thoughts:
This book is like a business version of Fight Club. When many people claim how easy it is to start a business, only Silicon Valley's famous entrepreneur Horowitz dares to say, "Starting a business is such a difficult path!" and unveils the secrets of management that successful business owners dare not say but secretly do!
Horowitz is the co-founder of Andreessen Horowitz, and also the most respected and experienced entrepreneur in Silicon Valley. In this book, he shares his own experiences, including how to start a business, operate, sell, purchase, manage, recruit excellent talent, lay off employees, and invest, providing practical wisdom that business schools don't teach, and how to solve the most thorny problems in the business world. His blog (bhorowitz.com) has nearly ten million followers who rely on his advice on business management, including how to fire your friends, poach from competitors, choose the right time to sell the company, and how to cultivate and maintain the mindset a CEO should have.
Over the years, Horowitz has gone from leading the cloud trend by founding Loudcloud to establishing the highly acclaimed Andreessen Horowitz. The journey was full of thorns, and each challenge was distilled into his unique insights in the book. This book doesn't boast about personal achievements; it simply analyzes how to solve problems when they arise. These major challenges include:
‧ How to find the right talent for the company?
‧ How to overcome the inner demons when the burden of operations is on your shoulders?
‧ Are you thinking positively or positively delusional?
‧ How to demote a friend?
‧ Should a leader tell the truth?
‧ What if smart employees become the bad apples?
‧ Should there be titles and promotion systems? And how to manage them?
‧ Is it okay to poach from a friend's company?
‧ Should the company be sold? And how to recognize the right time?
‧ What is the hardest lesson a CEO must learn?
### Chapter Outline
#### Chapter 1: Communist Grandpa, Venture Capital Grandson
This chapter is the author's self-description. After graduating from a computer science graduate program, he joined a startup and lived a difficult life. Later, he resigned and went to work for a large company, Lotus, but then he was shocked by the development of the internet after seeing the Mosaic (the first generation browser) product. He seized an opportunity and joined Nescape, which was just starting out at the time. He also met his friend (Marc Andreessen). The author then shares their experience at Nescape, from dominating one side and being the best in Silicon Valley to being defeated by Microsoft. After being acquired by AOL, he decided to start a SaaS service company, Loudcloud.
#### Chapter 2: I Will Survive
The second chapter is about the author's experience as the CEO of Loudcloud. Founded in 1999, Loudcloud caught the wave of the internet and SaaS services. It grew to over two hundred employees within a year, but also encountered the dot-com bubble burst of 2000 a year later. In addition to Loudcloud's revenue being cut in half, all the funds were also withdrawn. The following is the process that many CEOs will encounter (but you won't see it written in books):
- Sleepless nights.
- Endless presentations to find funding every day.
- Family life completely neglected; the company might collapse if you leave.
- After finally raising funds, you find that the performance can't keep up, and you face the danger of bankruptcy.
- The day before going public, you find that the internet bubble has reached its bottom. You might face the predicament of not being able to continue.
A year after going public, although the performance continued to grow. But it was also found that the entire industry was actually unable to grow anymore. So the author, without informing all the employees, began to look for a buyer for the company. And the system for managing the company's servers was extracted and became the main business of another new startup, Opsware.
#### Chapter 3: Overcoming Difficulties
After Loudcloud was finally sold to EDS, the author also smoothly, without informing most of the employees. Spun off the cloud operation suite into a new company, Opsware. So the first (and only) customer was of course EDS. The implementation of EDS was also not smooth, and the customer contact only gave them two months to implement. To solve this problem, they constantly communicated with the contact, and also knew that the contact was not averse to using Opsware, but he also hoped to use another software, Tangram, to inventory hardware equipment. So the author bought Tangram and gave it to the customer for free. Allowing the customer to renew the contract immediately. After getting through this hurdle, although the company went through two major layoffs, they were able to overcome them smoothly and grow into the industry's leading indicator. After many growth processes, it was also successfully sold to HP.
When looking for a seller, the famous saying: "If you want to hold a dog race, you must have a fake rabbit. If you want to increase the company's seller, you must have a fake buyer."
#### Chapter 4: The More You Fail, the More Courageous You Become
After Chapter 4, there are many CEO mindsets, which are worth thinking about.
- **How to get through the company's struggling period**
- **Don't take the pressure on yourself**: Try not to be a CEO who only talks about good news.
- **Starting a business is not checkers, but chess**: In addition to your own products, don't forget to look at the external environment and the market.
- **The longer you live, the more opportunities you have**: It seems that many startups will have this situation; the first priority is to keep living.
- **Don't blame yourself too much**
- **The difference between players and experts lies in their mindset when encountering problems**: It is impossible for a company to always be smooth sailing, and the mindset when encountering problems is the most important.
Next, the author also shares many psychological constructions and good steps regarding layoffs:
- **The importance of layoffs:**
- Look ahead
- Don't delay
- Tell the truth
- Train supervisors, they need good communication with employees.
- Public speech
- Be on the front lines
- **How to fire senior executives:**
- Problem analysis
- Inform the board of directors
- Tell the executive
- Inform the whole company (and give the executive some leeway)
Finally, the author also shares the psychological process. Layoffs are a painful decision, not the fault of the employees but the fault of the company's entire decision-making. But it is necessary to part ways amicably with the employees, and not to be self-pitying, because outsiders will not care how the CEO of the laid-off company thinks; the key is how to handle the assets and quickly get back on your feet.
#### Chapter 5: Manage People First, Then Products, and Finally Profits
Although the author himself started in sales, he believes that the company's products and employees are very important. In other words, he cares a lot about the company's growth and needs to manage the colleagues well in order to make good products, and finally, naturally, there can be good profits.
British statesman Churchill said: "When looking for talent, look at their strengths, not demand that they have no weaknesses."
Next, the author shares his "employee training" and "the importance of 1-on-1 conversations."
- Startup employees must have employee training:
- Because many things in the company are new, it is even more necessary to have a good training manual. To help with sales promotion and event handling.
This section is also what I consider to be the most essential part of this book. As the founding CEO of a startup, the author, who started in sales. Not only did he not take sales as the first priority, and customers as the highest rule. He actually considers employees, training, and products as the most important criteria. It's really rare!
- **The importance of employee training:**
- **Productivity:** The effect of employee training deeply affects the work productivity of employees after they are employed. If you want high productivity, you should not ignore employee training.
- **Performance management**: When evaluating employee performance, the effect is not good. Often because the employees did not receive enough employee training when they were employed, nor were they told what they should do to achieve "good performance".
- **Product quality**: Good employee training can allow everyone to have a consistent understanding of good product quality, and also have a deeper understanding of the product.
- **Employee retention**: Employees often leave because they dislike their supervisors (often because the supervisors' training is insufficient and they cannot lead the employees well), or because they cannot learn anything. Good employee training can often reduce these two problems. Making employees more willing to stay.
- **The main points of employee training:**
- **Competency training**: The purpose is to be familiar with all products, the venue and form are not the most important things.
- **Execute the training plan**: It is necessary to ensure that supervisors actually execute the training plan. If they do not execute employee training, there will be no replacement for the vacancies. (This is a bit cool!)
- **The training of management personnel must be done in person**: For the training of senior managers, of course, the CEO must come forward. It is necessary to ensure that every senior manager understands the company's main spirit and goal management.
Next, the author also lists a series of "Product Manager Guidelines". Actually, I think it can be a book on its own!!
##### Product Manager Guidelines
- A good product manager knows the market, competitors, and their own products.
- A good product manager will not spend time coordinating with various departments. (If coordination is needed, it means that the startup itself has insufficient communication)
- A good product manager must clearly define the goals
- A good product manager will prepare a product FAQ, presentation, and white paper. (Make sure everyone understands as much as you do).
- A good product manager will use written language to express their position
- A good product manager should focus the team on revenue and customers
- A good product manager thinks long-term
- A good product manager prepares for the news effect, and summarizes the key points for the news media
- A good product manager speaks clearly about everything
- A good product manager knows self-discipline (must have regular reports, progress reports, and will never omit related matters).
#### Chapter 6: When the Scale Grows, Management Becomes Difficult
After the company grows in scale, there will often be "management debt". It's like "technical debt", but this is the "management debt" left by the CEO.
##### Management Debt
- **Two tigers cannot share a mountain**: Making decisions cannot be unified.
- **Salary increases to retain star employees, but the salary increases are too high**: Causing many employees to follow suit.
- **Lack of performance management, and no employee feedback process**
Next, in addition to management debt, there are some very important things. The author also shares them:
- **Minimize scheming**: Through clear and transparent reward systems, reduce the space for everyone to scheme against each other.
- Salary and bonuses
- Organizational design and division of responsibilities
- Promotion process
- Avoid following the crowd
- **Transform scheming into "ambition"**
##### The Importance of One-on-One Meetings
The author highly recommends one-on-one meetings, and also shares that it is necessary to let the interviewee speak their mind, and try to express the opinions they want to express. If you want the meeting to have a structure, you can let the employee send you the items they want to discuss. He also shares some thought-provoking ice-breaking topics for meetings:
- How do you think the department should improve?
- What is the biggest problem in the company or department?
- Who do you think is very capable? Who is your idol?
- What do you think is wrong with this product?
- Are you happy to come to work?
##### The Importance of Corporate Culture
Corporate culture is not having afternoon tea on Friday afternoons, nor is it bringing pets to work. It is about the importance of the entire company. Amazon's former CEO Bazos used the door panel as the door of the meeting room, clearly indicating that the company should save money to allow customers to get the cheapest goods. The company should have one thing as the most important corporate culture, from the CEO to the employees, everyone can thoroughly implement one thing, and if it is done well, it can be used as a religious infection effect.
#### Chapter 7: CEO's Mindset
The hardest thing for a CEO is often not managing the company, not managing the employees, but how to manage their own inner self. How to prevent yourself from changing your mind, and not making employees unable to adapt. Here, the author also suggests using the following methods to train your own stability.
**Mindset:**
- Expand your network
- Put your thoughts into words
- Find a way out instead of looking for difficulties
Next, the author also explains many of the characteristics of a CEO, and how to cultivate related characteristics.
As a CEO, you must be able to give **employees the most efficient feedback**, and the author also suggests the following:
- Sincere attitude
- Good intentions
- Do not make personal attacks
- Do not embarrass the other party
- Feedback is not universally applicable
- Direct but not excessive
#### Chapter 8: The First Law of Entrepreneurship: There Are No Laws
The last chapter shares many of the difficulties of being a CEO:
- Should you be responsible, or should you encourage admitting failure:
- Here, the author suggests looking at the difficulty and avoidability of failure. Only then can you reward those who are brave and responsible, and also comfort those who have completed the task.
- When to sell the company
- The "Let's Try Someone Else" management technique: This is an idea to resolve departmental disputes, letting the two department heads exchange handling, and helping each other think in practice.
- Maintain a high level of performance
#### Chapter 9: From Entrepreneurship to Venture Capital
The author later became a venture capitalist, and also shared many ideas here. And he has a lot of special ideas in his blog, Podcast, and books. The final appendix is also quite classic, and includes:
- Interview questions for sales managers
- Interview questions for operations managers
These two alone are worth writing another book.
## Thoughts:
To be honest, I've heard too many stories about a16z (mainly through related introductions on Podcasts). But I didn't know their achievements in detail. After reading this book, I truly gained a deep understanding of the author. But what surprised me was that the author, who started in sales, believes that managing employees is the most important thing for a startup, and also considers product quality as the second most important thing. Many of the words reveal that the author believes that as long as the product is good enough to solve the customer's problems, regardless of the competitors and the market, you can still win the favor of many customers.
In addition, this book has many good insights on employee training and one-on-one meetings. As a CEO, these insights are also quite rare, and it also allows me to truly see how a good CEO can make the company grow positively.
## Reference Websites:
- [Andreessen Horowitz - Wikipedia](https://en.wikipedia.org/wiki/Andreessen_Horowitz)
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| [Andreessen Horowitz | Software Is Eating the World](https://a16z.com/) |
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| [a16z (@a16z) · Twitter](https://twitter.com/a16z?ref\_src=twsrc^google | twcamp^serp | twgr^author) |
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| [Podcasts | Future](https://future.a16z.com/podcast-network/) |
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