Startup Advice: Successful Delegation to Vendors

I received a lot of great feedback about my “Bootstrapping” post in which I shared some advice I recently provided to a friend that is working in an early stage startup. I’ll try to do more of this kind of thing– today a perfect example presented itself.

First, why this is important.

When you’re in a startup company (or any small business) your ability to focus your time and energy in the right directions will be a key to your success. As you start to scale up, this will mean that delegation and outsourcing will be required. Spend YOUR time on your core business– everything else should be outsourced and delegated as much as possible. This will make it possible for you to grow your business.

A family member is working at a startup company that was having a bit of a nightmare with an external vendor that they outsourced some web design to. He was more than capable of developing the site himself (indeed, he has years of very advanced web development experience) but, as an executive in a company with a lot of balls in the air, he recognized it wouldn’t be the best use of his time, and he correctly hired an outside company to do the work. Of course, as can be expected, all hell broke loose due to gaps in communication and a lack of mutual understanding of requirements. I provided the following advice to him regarding how to prevent similar issues in the future:

The keys to success when handing a project like this to a third party... (Obviously, this vendor relationship is beyond repair, but for future reference.)
  • Be painfully clear (to the point of being pedantic) and over-communicate requirements
  • Document the hell out of every conversation - take COPIOUS notes on every phone call, meeting etc.
  • A good rule of thumb is 1 page of typewritten notes per 15 minutes. Yes, really.
  • Religiously email those notes to all attendees and/or conversation participants. CC them to all stakeholders.
  • Make sure that the notes explicitly restate any action items, changes of plans, or new requirements
  • Remember that verbal conversations that are not documented NEVER HAPPENED.
  • Assume that they don't understand you. Ask them to restate what you just told them to do. In writing. (You'll be amazed how many hidden ambiguities this tactic reveals!)
  • Have them state, in their own words, how they plan to proceed... in excruciating detail. In writing.
  • Have them check in after the first 10 hours or so-- this is a key inflection point for resetting instructions.
And most of all
  • Assume NOTHING. There are NO implicit requirements.
Of course, the problem is that the overhead of doing this often exceeds the value gained by handing the work off to someone else, so calibrate the items above based on the following criteria:
  1. The importance and/or urgency of the project
  2. The risk if handled incorrectly
  3. The degree to which you have worked with this vendor on nearly identical projects in the past (you really only need to do this stuff the first couple times.)