Sep 2, 2020

My Two Biggest Mistakes in an Operations Job

Post by 
Harrison Johnson

wise bartender once told me: “sounds like you know good operations the same way you know good whiskey - you can tell it’s good when you don’t feel anything”

Bad operations, on the other hand, can feel brutal. Many business decisions over time, once implemented poorly, can be expensive to overcome. You need to rethink your processes, retrain your team, and make up for lost time. Thankfully, the biggest mistakes that Operations teams can make are common and can be avoided. 

Here are the two biggest mistakes I made at in an Operations Role at Managed by Q. If you can avoid these two mistakes, trust me, you’ll save your company a ton of time, money, and headache.

Mistake 1: Saying “Yes” When You Know You Shouldn’t

Managed by Q launched in 2014 offering smart office cleaning and maintenance. When we launched, I was the “Maintenance Team” - as in our entire workforce running not-cleaning at what was otherwise a cleaning-only startup. Faced with increasing demand for the maintenance product, I quickly built my handyman team by laying “Rabbit Traps” (TaskRabbit was THE thing in 2014). 

Our strategy was to promise our customers we could accomplish whatever they needed, and later figure out how to get as close as possible. While it is great to grow behind demand, customer satisfaction can only be as high as how your performance met that demand. In hindsight, we disappointed a lot of customers by setting expectations we couldn’t meet. These disappointments started small, but as we kept saying yes, they blew up eventually.

“Do you guys do office moves?” The rule was say yes to every job, but we soon learned that not every job is equal. We should have realized that office moves were far more complex and expensive than what we’d done in the past.

Normally, we’d call a third party and outsource a job that wasn’t “Maintenance”. But the idea of this office move had me drooling for my most-important-goal… Revenue.

Which leads me to the second biggest mistake of operations teams...

Mistake 2: Prioritizing Metrics over Customers

Here’s how our business worked. On a $1,000 job, I could either:

- have the work done by a W2 handyman, collect $1,000 in revenue, and about $500 in profit.

- have the work done by a third party vendor, transact $1,000 in Marketplace GMV, collect $150 in revenue, and $150 in profit

Since our core business was W2-employed cleaning, our most-important-goals were oriented around Revenue, not profit, or margin (this would change, but not for a long time). Why was this significant? I wanted my handymen (vs 3p specialists) to do the work too. They can pack a box, right? They can move boxes, right? They can rent and drive a U-Haul, right? Plus, I knew customers also wanted desks assembled and whiteboards mounted - things that my moving vendors did not want to do. Bundling the work with one supplier, my handymen, would reduce my costs and make it more likely someone took the job.

Unfortunately, supply is cash incentivized, not quality incentivized. I had plenty of people who wanted to work the hours, but nobody who had experience with office moves. This didn’t seem like a problem at the time, but in hindsight was a huge mistake. 

What Was the Result of These Mistakes?

These office move days ended up being some of the worst days of my professional career. I remember shepherding 30 office chairs down a Manhattan Mini Storage hallway in Chinatown. I remember rushing to Soho on a Sunday to unpack glassware for a law firm. I remember bribing a doorman in the Financial District so he’d run the elevator past 5pm. Despite all the heroics, I definitely upset more customers than I made happy ones.

When I look back, it’s easy to say our customers would have been better off if we said no, and the business would have been better off if we didn’t prioritize the revenue.

Why was it so hard to do this at the time? 

Unfortunately, Operations teams are often the silent martyr of a company. It’s easy to tell ourselves that Operations problems aren’t important until a customer complains, but the truth is customers notice the small problems that happen when you make short-sighted decisions, like always saying yes and prioritizing metrics over your customer experience.

Saying yes all the time, especially when you’re not an expert in something, sets you up for disappointing customers in ways you can’t expect, and often, you don’t even know about. Did a customer ever complain when we showed up with newspapers because we had forgotten packing materials? No. Was it a problem? Yes.

Prioritizing metrics over customer experiences is bad for Operations because the narrow pursuit of a goal can make you miss big business opportunities. In my example, I should have established partnerships with moving companies much earlier on. 

As much as we love to play hero in Operations, we don’t always have enough superpowers to save the day. Feeling like we have huge problems to overcome every day is a sure sign we’re making mistakes. The good news is we can think and plan ahead for these types of situations, and avoid all the feelings of agony and pain. 

We finally started to get it right when we focused our operations, tracking them and learning from these mistakes.

You’ll know you’re doing it right when Operations don’t feel like anything at all.

Get the free tool described in this post