By Ben Horowitz
This book is part Ben’s story about running a company called Loudcloud (and later Opsware) as the CEO and co-founder and part Ben’s advice on how to be a good CEO. He focuses mainly on the hard things; the subtitle of the book is “Building a business when there are no easy answers.” He now runs a venture capitalist business.
I thought his story of running a software company through the dot-com bust and coming out on the other side with a successful sale to HP was gripping; I read the first half of the book the night after I picked it up from the library. But it was his advice throughout the rest of the book that really struck me. It shed a lot of light on what the previous company I worked for did wrong. My last months at that company were anxiety inducing to the point where I dreaded going to work. Yet it was my first job; I couldn’t figure out exactly what was going so very wrong.
Here is one thing Ben articulated that really resonated with me:
In ‘CEOs Should Tell It Like It Is’: “My single biggest personal improvement as CEO occurred on the day I stopped being too positive. … As the highest-ranking person in the company, I thought that I would be best able to handle bad news. The opposite was true: Nobody took bad news harder than I did.” He lists three key reasons why being transparent about your company’s problems makes sense: 1) Trust. 2) The more brains working on the hard problems, the better. 3) A good culture is like the old RIP routing protocol: Bad news travels fast; good news travels slow.
He talks about a lot of other great, fascinating things as well. Like how setting timelines and guidelines for promotions and raises decreases the amount of politics in a company instead of increasing it– this way employees don’t get these things out of cycle, which always trickles back to others thinking that the best way to get ahead is to go bug someone higher up the chain. Or how CEOs have to take the lonely position of making final decisions often without anyone else’s help. Sure, a CEO can and should get information from others, but the CEO should know far more than every single person she gets information from. She is, therefore, the only one who can truly make an informed decision. Or how there is a difference between a wartime CEO and a peacetime CEO.
In addition, Ben is a great writer. He’s long when it’s story driven and short when it’s advice driven. He’s direct, honest, and every word of the book makes me think he’s a good guy, even when he talks about telling people off or firing employees.