How Do You Know When the Talking Isn’t Walking?

By Justin Talerico

Aug 15 2019

Let’s get another cliché out of the way. Talk is cheap. Hmm. In SaaS that’s actually not so true. A lot of talk gets funded. And a lot of decisions get made based on plans (nice, formalized, talk). From there, a lot of evaluation is done based on reporting data (another form of talk). I sit on boards of companies, and even that level of talk is separated from what’s really happening in execution. No, numbers don’t lie. But they often unintentionally or intentionally obfuscate reality. It can be hard to accurately create a SaaS diagnosis of what’s really causing good, bad, or indifferent performance.

Who cares what’s really causing performance?

That’s actually a good question. Who actually cares? Does it even matter? Or is all that matters what’s hitting financial statements? Even if that’s all that matters to the VC, management should actually care about causation. Because blaming the wrong things turns into changing the wrong things and messing up some of the right things. It can be even worse than that — you can indict a model because of execution, or blame execution when it’s really your model. Yeah, that’s heavy. And I’ve seen it play out.

Too few weedeaters.

The trouble I’ve seen only gets identified when you go deep. And most “SaaS leaders” work under the assumption that staying out of the weeds is the path to success — working on, much more than in the business. But here’s the rub. You will find very few SaaS leaders who know (or admit) that they’re actively doing the wrong thing. They will tell you (talk, talk, talk) that they read the right stuff, follow all the best practices, and execute relentlessly. But the only way to know that they are or are not doing those things well, is to validate. And validation happens in the weeds.

When should trust give way to verify?

We should not micromanage and go deep in the weeds to verify everything. In fact, it’s unsustainable and counterproductive to do it any more than we absolutely have to. But when it’s warranted is a tricky judgement call. I use a highly unscientific gut check to feel when things don’t quite add up or align with my SaaS worldview. Obviously, that’s not a scalable nor objective answer. But, it’s kind of true.

Let’s get back to indicting the model versus indicting the execution. This is a good gut check moment. When the space, TAM, and fit appear objectively good, but traction is harder than it should be, look to execution. That means, go as far into the business, as deep in the weeds as needed, to go to verify that it’s not an execution problem. If you dig down there and it’s not, then it may be time to indict the business. But you can’t pull that trigger until you’re sure (via weeds, not reports).

If you do verify that the walking looks more like crawling, then the question is why? Is it people? Process? Management? A lack of one or more of those things? Is the strategy not executable for some fundamental reason? Diagnosing the why behind executional failure is surely a whole other article (or perhaps that’s what SaaSX is?).

We see a lot of executional failure, all the way down to the script level in Sales, the copy level in Marketing, and the playbook level in Support and Customer Success. Some of those gaffes are obvious. Others get obfuscated by smooth talk. Executional problems are all fine, and oh so normal, as long as they’re correctly diagnosed. That stuff’s easy to fix and far less costly than funding a bad model or indicting a good one.

Recently, I’ve seen SaaS founders step deep into facets of their businesses to diagnose growth impediments. In every case, I’ve also seen them put fixes in place that have enabled their businesses to thrive. Yes, they get their hands dirty. Yes, they get in the weeds. But it’s for a very good cause. Sometimes the lowest-level things can have the highest-level upsides. Don’t overdo it. But also don’t be so averse to it that you fail to verify that the talking is actually walking.

Content by Beacon9 SaaS Business Advisory

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