⚙️ Ops Playbook #27

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Good Morning Operators ⚙️

A reader emailed me this week asking about his next career move. After publicly sharing news about leaving his job one week ago, 5 opportunities have popped up.

The opportunities are all over the place - startups, agencies, and corporations.

He is grateful for the chance, but here's where it gets tricky. These connections are crafting new roles just for him.

The two questions this reader has is:

• Everyone has said, "I'm not sure how we'll use you, but I know you'll be an asset". But here's the concern: being the jack-of-all-trades is a recipe for potential burnout. Do you have frameworks that balance defining an operations leader's role vs flexibility to adapt as the business evolves?

• Choosing the leader I want to team up with is a bit of a puzzle. Can you help me devise a way to assess each leader to determine who aligns best with my skills, values, and how I communicate?

So that’s what we will dig into.

Here are today’s topics:

• Balancing your skills vs business needs → Try skill mapping to figure out what the team’s current skills are, what they're missing, and what they'll need down the line to keep the business rolling

• What interview questions to ask your CEO → 3 questions to ask a potential CEO before you join

• Save on your taxes with R&D credit → 5 myths about the R&D credit

• 3 principles when dealing with troublemakers [Premium members only] → There are good and bad troublemakers. How you deal with them can make or break you.

Let’s jump in.

(P.S If you ever have questions about scaling a business, feel free to reply to this email or email me at [email protected])

^{Together With Fondo}
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Operators Library

• When mapping out a buyer funnel, keep things simple and clear when tracking customer journeys. Be sure to avoid fancy words and include all ways you can grow, like getting more sales or selling different products. (Link)

  
  

• Most people hate their accountants. Sam Parr created a thread where people could post their love for their accountant. Besides accountants, would you want a vetted list of service professionals like lawyers, marketers, and designers? Respond to this email, and I can whip this up for you. (Link)

  
  

• Your tech stack works better when you focus on four main things: how much people actually use it, how well it fits with your other tech stuff, if it's right for what you need, and if it gives you good information. (Link)

  
  

• Tom Alder crated an awesmoe post about 12 lessons from Dharmesh Shah, Hubspots CTO, about building companies. Dharmesh is prolific having built very different (and successful) ventures (Link)
  
  

• Tax season is here folks. Instead of relying on your accountant, you should know the ins and outs of your tax return. The best person to help you save money is yourself. This guide on corporate taxes was helpful to me as I’ve prepped my own returns (Link)*

P.S. To get featured in this section, share the newsletter 10 times using this referral link, and I'll include you in a future issue. 

1. Skill Mapping Your Way to Freedom

Insight from ChartHop

Companies run a skill mapping exercise to chart out the existing skills of their workforce, team strengths and gaps to plan for future needs.

Let's flip this.

You should run a skill mapping exercise for any company you could join as the operations leader.

By creating a skills map, you gain insights into how the team is structured, where the company prioritizes resources, and where you can step in to provide value.

This way, if you join, you will have a clear set of responsibilities while being flexible enough for the business.

Here's how you can run a skill mapping exercise too:

1. Research and Preparation:

   Understand the industry, the company's position within it, and any strategic moves they've made. Note your own skills and weaknesses. What are you top 1% at in the world?

   
   Before chatting, be sure to have a list of questions that will reveal the current skillset of the team.

   
   These questions could be about the challenges the company is facing, the skills they find most valuable, and the expectations for the role you're considering.
   

2. During the Chat:

   Ask about the team's strengths, the areas they're looking to improve, and how future growth plans.

   
   Be sure to note down the team’s org chart during the chat. If you can have multiple conversations with team members, be sure to do so.
   

3. Assessing the Fit:

   After gathering all this information, compare the company's needs and future direction with your own skills and career aspirations.
   

   Do they align? Are there areas where you can grow? Consider if the company's environment, the role's expected evolution, and the skill development opportunities align with what you're looking for.

If you can grab enough information, try creating a matrix like this. (Obviously not as intense).

With this type of mapping, you’ll be able to work with the hiring manager to clearly lay out your responsibilities, identify business needs and where you can grow.

2. Interviewing Your Potential Leader

Insight from Rameel Sheikh

You will get wooed during the interview process to be an operational leader. All (great) CEOs are amazing recruiters.

What you need to figure out is if you believe in this person.

Do you believe this person can lead you and your team every day?

No company is successful with a CEO who can’t get everyone on the same page, who can’t hire well, and who can’t chart out a vision.

Early in my career, I remember interviewing at one of my first jobs, and it was hard to tell if a leader was “good” or not.

After years of experimentation, I do the following to determine if someone is the real deal.

First ask these 3 questions to see if there is a potential match:

1. "Can you share instances where you've had to soften the message or withhold full truth from your team?"

   The way a CEO responds to this question can tell you a lot. Being the CEO will naturally cause you to withhold information from their team.
   
   If a CEO makes light of the question or suggests it's a common practice instead of an example, it may show a tendency to mislead employees frequently.
   
   Ideally, you're seeking a CEO who can openly discuss times when they've had to be less than fully transparent while balancing morale.
   

2. “What do you think is your greatest leadership blindspot?”

   This question is a fresh spin on the familiar "What's your greatest weakness?" but it goes deeper by focusing on blind spots—areas the CEO might not always notice or acknowledge.
   
   Their response will offer insights into their level of self-awareness. If the CEO struggles to provide a clear answer, it shows a lack of introspection. However, if they offer a thoughtful response, it shows a level of humility that's valuable in a leader.
   

3. “What would an employee who’s left the company say it’s like to work for you?”

   This inquiry is pivotal as it sheds light on the CEO's awareness of their impact and openness to acknowledge past leadership mistakes. If you can, get references when you are asking this question.

If you’re hesitant to pose probing questions for fear of offending the CEO, consider this is a red flag. Truly effective leaders appreciate and encourage tough questions.

If anything, asking these questions should make you look better in their eyes. Asking the tough questions before joining shows that you value your own time.

Once you've asked these questions, you must reach out to past employees who have worked with the CEO.

Try asking similar questions you've asked the CEO to see if they match. While not all former employees will be positive, this will reveal a ton about the CEO and culture of the company.

3. Save on your taxes with a R&D Credit

Insight from Fondo*

In my research with this week's ad partner, Fondo, I learned about the R&D (Research and Development) tax credit. Think of the credit as a handy way for businesses to save a chunk of change on their taxes.

You get about 13 cents for every dollar spent on creating new products, improving the old ones, or whipping up some nifty software.

I'm super embarrassed that I didn't know about this credit beforehand. I would've saved thousands.

At first glance, the R&D tax credit can seem like a maze (or you weren't even aware it exists like me)!

Let's break this down.

If you want to snag this credit, you've got to keep tabs on your expenses and show solid proof like payroll records and receipts for R&D spendings.

There's a form called Form 6765 on the IRS (Internal Revenue Service) website that guides you on how to do this.

This credit can significantly lower what you owe in taxes. And if you are the smaller guys or new startups, it's even sweeter because it can reduce what their AMT (Alternative Minimum Tax).

Plus, a recent tweak in the law means these small businesses can also use the credit to lighten their payroll tax load.

Deciding how much you can save involves a bit of number-crunching. You have two ways to calculate the credit. Be sure to use Form 6765 as the guidebook for picking the path that packs the most punch.

This credit covers all research costs, whether that's salaries, supplies, or getting external brainpower on board. But remember, the research has to be done stateside and fall into the science or tech category.

Now, despite the R&D tax credit being around for a while, some myths make you think you don't qualify. Here are 5 common myths:

1. "We don't pay federal income taxes, so no credit for us." 

   Some start-ups and small businesses believe they can't get the R&D tax credit because they aren't paying federal income taxes. But, these businesses can use the R&D credit to lower their payroll taxes (the taxes taken out of employees' wages) by up to $1.25 million (or $250,000 annually for five years).
   
   To be eligible, a business must make less than $5 million a year and have been making money or earning interest for no more than five years. The credit is claimed when they do their taxes and can be used to reduce payroll taxes in the next quarter.
   

2.  "We're not a tech or science firm, so we don't qualify." 

   All kinds of businesses do R&D in different ways, like cooking up new recipes in kitchens, trying out things on farms, or making materials on factory floors. R&D can happen in many places.
   

3. "We don't have scientists or engineers, so we're out." 

   Any company that does research or tries out new things can qualify, no matter what kind of jobs the people doing the work have.
   

4. "We're not inventing the next big thing, so we don't qualify." 

   Companies sometimes think they need to invent something totally new to qualify for the credit. But the credit is also for businesses that make their products, processes, or software better or different, not just brand new.
   

5. "AMT issues mean we can't benefit." 

   In the past, the AMT made it hard for some businesses to get the full benefit of the R&D credit.
   
   But since 2016, individuals and small businesses that pay AMT can also use the R&D credit to lower their AMT or regular taxes, which means they can now take full advantage of the credit.

Keep this in mind, and who knows, it might come in handy for your own ventures.

4. Dealing with troublemakers

Insight from Bethanye McKinney Blount

You ever work with a troublemaker?

You know that guy who decides to rewrite an entire system in his off-hours in a new language without telling anyone else?

The dev who won’t share any of her code while it’s in progress?

Or the person whose interactions with colleagues sends them all to your desk five minutes later?

I certainly have worked those folks before.

I'm sure you have too.

Bethanye McKinney Blount also has.

For the last 20 years, Blount has led technical teams at a range of companies, from tech titan Facebook to Second Life creator Linden Lab to music recording company EMI.

Broadly speaking, tech companies produce a special flavor of troublemaking.

“It’s super common in many companies, but especially among people in tech: we have this idea of what we believe is the one true way to do things — whether it’s how to design, collaborate or ship,” says Blount.

Blount has gathered 3 guiding principles around troublemaking that are less to vindicate troublemakers and more to put their actions into perspective. Here are her three tenets on troublemaking:

1. Your founders are the first troublemakers — don’t make them the last.

   Founders are often the first to shake things up in a company, and that's a good thing. But it's important that they aren't the only ones. If everyone always agrees and does things the same way, a company won't grow or get better.

   Founders should remember that as their company grows, they need to let new ideas in and let the company change. If they don't, the company could get stuck and not be able to handle new challenges.

2. Couch troublemaking in the context of company stage.

   When a startup grows, what counts as troublemaking can change. Early on, certain behaviors might be good because they keep the company lively and quick.
   
   But later, those same behaviors might cause problems. Leaders must understand these changes and not push forward without considering new challenges and opinions. They should think about what these behaviors mean for the company as it evolves, instead of trying to get rid of them.
   

3. Troublemaking is often done unconsciously.

   Most of the time, people who cause trouble at work don't do it on purpose. They're not trying to mess things up for everyone else. Sometimes, people might act out because they're frustrated or feel unheard.
   
   Managers should try to understand what's bothering these troublemakers and help them get better, not just punish them. It's important for managers to support their team members and help them succeed, even when they make mistakes.

Be sure to cut ties when troublemakers become too much. However, some of the best can change the trajectory of your company.

Something Fun

Feel free to reply with your meme; I might add yours to next week’s edition.

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