This isn’t new advice but it’s definitely worth repeating. Backing out is hard to do. Whether it be a personal relationship, a business deal, or an email newsletter, getting out of something will always be harder than getting into it. While this is simple and timeless advice it has a special and important role in a young company’s upbringing. You see, young companies are often strapped for cash. Because of the strapping they often do whatever they can to make a buck. They’ll take on any project because they need to make payroll. The problem is that most of the projects you’ll take on out of desperation are going to cost you much more than they make you in the long run. Why? Because once you start dancing with a client it’s very hard to stop. Here’s how it works:
- Young company needs cash
- Young company takes on client for cash
- Young company completes client project only because it pays
- Young company gets paid
- Young company makes payroll
- Young company continues to get calls to support the client and project
- Young company feels obliged to support their own work
- Young company’s workers begin to hate project & client
- Young company begins to not care about project or client
- Young company eventually just does whatever the client wants, no matter how stupid
- Young company’s work for the client become boring, uninspired, and monotonous
- Young company does this for many years
- Young company’s workers contemplate quitting, suicide, or client murder
- Young company finally gets balls to back out of the project
- Young company lost months of man hours doing something that drained energy and creativity out of them
- Young company vows to never do it again
- Repeat
Moral of the story: Not making payroll is better than years of turmoil.
Comments
Isaac Grant - November 9, 2005 10:30 am
Preach On!
Rob L. - November 9, 2005 11:28 am
I'm assuming you've got a specific client in mind here. Everybody's got one.
Charlie - November 9, 2005 4:56 pm
"Not making payroll is better than years of turmoil."
Unless not making payroll means somebody's not going to eat tonight. In that case bring on the turmoil and pass the mac and cheese.
CF
Isaac Grant - November 9, 2005 6:57 pm
As one of a few who survived for two years not making payroll because of our collective belief in not taking on projects like Dan mentions, it was more than worth it for many reasons.
Carl - November 14, 2005 12:08 am
"Not making payroll is better than years of turmoil."
Must be nice to be in situation where you can not make payroll and still retain your employees.
Missing payroll, no matter how you justify it to your employees, isn't exactly a morale booster. If my employer missed payroll just once, i'd be updating my resume right away and hitting up the job search sites.
silverorange has a very different background from most companies, being founded and primarily staffed by very young employees who could get by missing payroll here and there... when you have a company with employees who have spouses, children to provide for, mortgages and car payments... missing payroll isn't an option.
Dan James - November 14, 2005 10:01 am
Carl,
You are right. We have a much different background than most companies. But it is just that, a background. Almost all of us now have spouses/significant others, car payments, mortgages, and we've got our first silverorange founder's baby on the way! Even today with all of this I know most, if not all, of us here would take a hit personally so that we could do what is right, not what is desperate.
There is another big difference between silverorange and other companies. The people who work here built this company to what it is. Each person has contributed to the where we've gotten. To leave would be to leave something they created behind. They also would be leaving a team that encourages them, trusts them, and respects them.
From what you've said it sounds quite a bit different for you and your situation.
Carl - November 14, 2005 11:09 am
Yes, my situation and employer is certainly different from silverorange... but it it is the norm. silverorange is the exception.
Your views on the situation are admirable, but for many it is unrealistic.
Robert Paterson - January 14, 2006 2:56 pm
Carl
I think that the deeper point about being realistic or not is about the core culture of the organization.
SO is founded on quite different principles to a regular organization. I feel that what we understand as being "realistic and normal" is deeply flawed and is based on mechanical relationships. Mechanical in that non one really cares about the work, the client or each other.
SO is more like a tribe. It is a social unit that also goes hunting. Like a tribe, it is hard to get into and hard to leave. Like a real tribe it finds a way when times are tough and shares and celibrates in the times of plenty.
We all lived like this for millenia. It is the natural way to organize. As more of us reject the machine, my hope is that we will find ourselves returning to this way of working and living.
It is what we see as our normal way of working that is actually unrealistic as it fails all our needs but a paycheck and we only get that by becoming a slave.
Rob