Common Blindspots for Executives with Jenny Lawton

Speaker 1: Welcome to the Daily Bolster. Each day we welcome transformational executives to share their real- world experiences and practical advice about scaling yourself, your team, and your business.

Matt Blumberg: Welcome to The Daily Bolster. I'm Matt Blumberg, co- founder and CEO of Bolster, and I'm here today with my friend Jenny Lawton. Jenny is an experienced senior operating executive in the tech and startup world with senior roles at Techstars, at LittleBits, at MakerBot, and at Bolster. She is actually the second Bolster alum to appear on the Daily Bolster, and now Jenny's focusing her work on helping early- stage entrepreneurs succeed. Jenny, great to see you.

Jenny Lawton: Great to be here.

Matt Blumberg: All right. My question for you today is you spend a ton of time with entrepreneurs, especially in the early stage. You probably do that as much as anyone I know. What is the most common blind spot you see in executives that kind of surprises you? What's the piece of advice that you have to give over and over and you're like, why am I doing this?

Jenny Lawton: Yes. So one of the things I'm always surprised at is, one of the things I'm happy about is when executives talk about metrics and how they're doing in performance. But one of the things I'm always surprised about is that they talk about metrics a lot of times in absolute terms instead of relative terms. So they'll say something like, oh, we sent out an email campaign and it had this great open rate. And I'll say like, oh, great, so what was your open rate? Oh, we had an open rate of 10%. And I said, that's great, and what was your expected open rate? And they'll be like, well, I don't know, but it was 10%. I'm like, well, how do you know if that was good or bad? And was it 10% of a hundred or was it 10% of a million? Because those answers matter. So relativity of data is one of the points that I really drive home with people, and I don't know, maybe it comes from my math background, but I think it's really important.

Matt Blumberg: Well, and relativity of data to what is the question? And it could be lots of things, right? So relative to budget or relative to plan or expectations, relative to comparables, relative to last month. I think there are lots of ways to look at relativity, but it's hard to imagine being a serious executive without grounding data in something.

Jenny Lawton: Well, I think it leads to this really interesting mistake that gets made around managing budgets where I've also met with many CEOs of fairly large companies who are very proud of the fact that while they were down on revenue that they spent to budget on their expenses. And I always take a breath and I'm like, if you're down in revenue, you need to actually then change your expenses relative to what you're down on in revenue. So you really need to know your percent spend to revenue, because if you're spending to your expense line in your budget and you're down on your revenue, you've just overspent by potentially a fair amount. And so that's actually where you see the error really come home. And I'm surprised at very experienced CEOs who make that mistake.

Matt Blumberg: And it is relativity of data. What are you managing too? Are you managing to two different lines or are you managing to the line called EBITDA?

Jenny Lawton: Yeah, yeah, absolutely.

Matt Blumberg: All right. Jenny Lawton on Relativity of Data. Thank you for joining me.

Jenny Lawton: Thank you.