How to build a team from the ground up in 7 steps

Jay grew a 1000 square foot brick and mortar window covering store into Blinds.com, a billion dollar business that he sold to Home Depot. He says he couldn’t have done that without a great team. His team was so coveted, that even when he sold Blinds.com to Home Depot, the acquiring company wanted everyone to stay.  

1. Why Are You in Business? 

Step one is not about what you should do, but why. Ask yourself “why am I in business?” For me, it was about having more control over my life, my destiny, and autonomous decision making; not primarily about making a lot of money, although that was certainly a goal.

If your goal is to make a bunch of money and retire early, that’s fine too. Just be honest with yourself. If you delude yourself, you’ll hire the wrong people, and their motivations will not be aligned with yours. That’s a path to disaster.

Here’s an example. If your reason for being in business is to solve a societal problem and you hire people principally interested in money, the decisions they make will likely compromise your solution in the interest of higher profits. And the patience that might be needed to allow your solution to eventually evolve and work will be thwarted by your employees’ short-term thinking about their own personal monetary goals.

When you’re looking for money to invest, if you take money from investors interested not in solving that societal problem, but only looking to make a short-term profit, they’ll possibly cut your research budget and then you might never achieve your own purpose.

Take time to understand what makes you tick and what you’re trying to build. Then look for others with that same motivation.

There are numerous reasons for going into business. Here are a few. How many of these resonate with you?

a.     Make a lot of money

b.     Control your destiny and make your own decisions

c.     Solve a societal problem

d.     Create a legacy for family

e.     Curious to see what you can become

There are many possible reasons.

2. What's Your Vision? 

Now that you know why you’re in business, and the kind of people to hire, step two is to create a clear vision of your future. It should have at least two key facets: it’s ambitious and compelling. For me, it was not to achieve some monumental revenue target. And it wasn’t to become number one in the world selling blinds. We thought blinds were merely our first product. Our vison was to become the best in the world at selling complex, customizable, hard-to-buy products.

And once again, it didn’t start that way. When I created the world’s first window coverings website, is was merely to sell a few more blinds. No grand vision! Just making buying blinds and shades a no-brainer. [I] originally called it NoBrainerBlinds. And everyone told me it was a hare-brained, ridiculous idea.

Whatever you decide, make your vision near-impossible to achieve. Maybe that’s counterintuitive, because people tell you to make bite-sized goals that are achievable. Well, you do that too. But start first with a massive vision, because that will motivate you and your team to take those small steps and keep you going through the headwinds you are certainly going to face. Keep your vison always in mind, and take dead aim at what you must do today.

Make your vision clear to potential teammates. Put the vision in your employment ads and ask applicants what they think of your vision. And before you know it, you’ll be surrounded by builders and creators, not just people who tick off instructions you tell them to do. A compelling vision attracts the best talent and keeps them.

3. What's Your Organizational Design Hypothesis?  

The third step for developing an effective team is developing a hypothesis about what you need to build your company – in the way of resources, competence, and organizational structure. We never thought of ourselves as a blinds retailer. Instead, we were a direct marketing company.  So naturally, we focused on attracting people with direct marketing experience, data scientists who liked to experiment, and technologists that had built and scaled companies.

Let’s say your business is a transmission shop. How do you envision your business? If it’s just a local repair shop, then getting reliable and competent mechanics is what you should focus on. If instead you want to create a business that also gets referrals from other repair shops, then developing a sales force is needed. Another aspect is how you think about customer service. If you want your customers to appreciate their experience, then maybe you should hire people who cater to individuals, such as those who work in the hospitality industry.

4. What Are Your Gaps? 

Once you know why you’re in business, what you’re trying to achieve, and the kinds of people you think you need, step four is knowing your gaps. What do you need, versus what do you already have? That includes a candid assessment of yourself. What are you good at? What are you not so good at? What can only you do? What do you like to do, versus what should you do?

A friend of mine sells vinyl records. He loves to spend hours each day packaging the albums and shipping them off.  He’s also uniquely talented through many years being in the music industry at getting access to and developing partnerships with famous musicians. I told my friend that it was fine to occasionally pop in to the fulfillment room, but his time should be spent more in creating those partnerships and paying someone else to fulfill. Are there things you may be doing today that you like doing, but maybe you should delegate?

Self-assessments are hard but essential. And it’s not just what your business needs today, but what it will need tomorrow. Think at least a year into the future and make sure you’re developing your team to be able to assume those future roles. The next part might be one of the hardest things you’ll have to do. If you and your team are not capable of doing those things, no matter how fine a job they’ve done getting you to where you are today, be honest. And hire people who can. This doesn’t mean that the existing people must leave. You want to be loyal to your people and reward them for that loyalty, but you’ll only frustrate yourself and other teammates if you don’t make the smart move. Is there anyone you can think of today that you’re not being totally honest with?

5. How Do You Incentivize? 

It's impossible to retain employees without providing fair compensation. Understand what the market pays for similar roles and be sure you’re competitive. Paying people market value for what they’re worth - is table stakes. The real key is to provide objective goals to incentivize them to do more and to incentivize the behaviors you believe will provide benefit to the business.

For instance, if your sales team is selling a product, don’t just pay them for the revenue associated with that product. Also base their pay formula on whether the specific products sold to a particular customer were the right products for that customer’s circumstances.  That aligns your revenue goals with customer satisfaction. Because customers will now trust you more because they’re buying products they really need, they’ll end up buying more. More revenue and the right products lead to more compensation for the sales team and higher retention. So everyone wins.

6. What Do Your People Want? 

By now, your revenue and profits should be accelerating. Congratulations! The first five steps you’re now doing should keep most of your people, but these builders and creators might have other plans for themselves.

If you want to keep them, step six is to ask them what THEY want over the next few years. Most will tell you about being promoted in your company to higher paying jobs with increased authority.

But if they say they ultimately want to start their own business or become a leader at some other company, counterintuitively, you will keep them longer than had you not asked. Here’s why: because you now know how to further motivate them and help them achieve not only your own business goals, but your employees’ personal goals too. Ask this question of what they want every month, and agree on how you can help them personally develop towards their goals.

The personal development and coaching you can give them will keep them longer because they’ll realize that getting to where they want to be will be faster with you than trying to do it on their own. Plus, there’s a bonus. That development will increase their skills, making them more productive and engaged.

7. How Do You Communicate and Set Expectations? 

There’s just one more step. Ensure your expectations for all of the above are clearly communicated in advance. Apply everything consistently – then reward and recognize all the behaviors mentioned above.

In Summary 

So let’s recap the 7 steps. Ask yourself:

1.     Why are you in business?

2.     What’s your vision?

3.     What’s your organization design?

4.     Where are your gaps and how do you fill them?

5.     How do you incentivize?

6.     What do your people want?

7.     How do you communicate and set expectations?

Everything above is just common sense, but unfortunately, not commonly done. You can do these 7 steps. It really gets down to this: respect your people with courtesy, personal development, and generosity. Is it asking too much to bring humanity back into the workplace?

Do that, and you’ll attract the best people. And your team will perform far beyond anything you ever dreamed possible. Good luck!

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