Celebrity Insights: An Interview with Scott Jordan, the Pocket Man
My introduction to Scott Jordan. I was an analyst at the Giga Information Group, it was 1990 something and I was collecting “toys” for a conference. I contacted a start-up called SCOTTeVEST and I talked to Scott, told him about my presentation and he sent me a jacket. I have been wearing a SCOTTeVEST of some sort since then.
I had the opportunity to talk with Scott about his experience as an entrepreneur and a manager. This is a slightly edited version of that interview (I removed all the “ums” and “you knows,”) but other than that it is Scott being very honest about his management style, what he’s learned from mistakes along the way, and other lessons entrepreneurs will benefit from.
Photos of Scott Jordan by Thomas Hawk, via Flickr https://www.flickr.com/photos/thomashawk/.
Celebrity Insights: An Interview with Scott Jordan, the Pocket Man
by Daniel W. Rasmus
Serious Insights (SI): When you started thinking about being a leader of an organization, who did you study, who did you read?
Scott Jordan (SJ): You know, I really didn’t, and I paid a pretty significant price I would say for not doing so. I was a horrible manager originally, and I think I’ve gotten better, much better. I grew my business organically, just a few people to start and I didn’t think it required terribly much management style, to be honest. I was proven by difficulties in retaining, hiring people, that it became harder and I tried to work on that.
I could talk about this for hours. The fact of the matter is that shortly after Chicago – we started our business in Chicago and I was there for about two years. We were just in start-up mode with some junior people. And then moved to Sun Valley Idaho, and my wife joined the business full time at that point.
When it was just the two of us with an occasional bookkeeper or customer service person, it was fine, but as we added more people, it became problematic. What we discovered is that you need to define a corporate culture – we discovered this very late in the game – and say what’s important to you and why you do the things you do and what the mission is and all those wonderful things that seem self-evident now.
We had tremendous struggles because our local community has 5000 people in it, and when you have an applicant pool that is tiny, it makes growing a business almost impossible. You get further exasperated when you do things wrong and people go out into the community and say what a horrible place SCOTTeVEST is to work. It becomes self-fulfilling, whether it’s true or not.
Again, I could talk for hours on the subject. I’ve experienced a great deal of pain in the process, and it continues, although at least now I’m understanding it more. I think the only other relevant point would be several years ago, when our business was doubling year over year, I thought it would be wise to hire a ‘professional manager’ and brought a president into the company. There started the bozo explosion. Are you familiar with that term?
SI: I am not.
SC: It was coined by Guy Kawasaki at Apple. It builds on the idea of “A” players, and “B” players and “C” players. The first time you hire a B player in a significant role, what happens is the B players are going to hire B- players and the bozo explosion occurs. In my case I’m the one who first hired the B player, so I’m the king bozo (chuckles).
I have to recognize that. And we were recovering from me not owning the fact that I had to switch from entrepreneur to manager, and wanting to outsource that. We paid a significant price.
SI: Was there any place in particular, once you started realizing the issues you faced, that you looked for outside advice or information?
SJ: Rather than trying to adapt to other people’s ideas, what I decided to do was define my work style and set expectations around my work style.
We have some core principles to our corporate culture and how we deal with things. We have a “I’ll figure it out mentality” – and speed matters, doing things fast matters. And grammar matters. We make it really clear that this is what you’re judged by.
And no fucking drama, you know.
We’ve experienced one cancerous employee, one friend. So they will find more friends and spread that cancer. Misery loves company and so we have zero tolerance for drama. I mean our problems are exasperated by the small applicant pool here and the difficulties in hiring and bringing people here.
Once you finally bring someone here, if they have a spouse then you’ve got to spend time selling their spouse on why to live here, knowing full well that if they don’t work out in a small community, there are no other jobs here. There’s a lot of pressure.
Honestly, our business has been plagued by a series of lousy people in our controller role, missing someone with solid organization skills and who could pay bills on time. You spend most of your days wondering whether you have money in the bank to pay stuff when you do. I mean, in our case we did.
I had a controller who literally had to do a flow chart to determine what to do when a bill came in. I walked into his office and he’s got ‘open bill’, you know, ‘pay bill online’ or ‘pay bill…’ I mean he literally forgot to pay bills when there was money in the bank. That’s been frustrating.
What I’ve recently found is that we need implementers, people to get shit done. I’ve got more ideas than I know what to do with. We’re literally three $40,000 a year admins away from being a $50M company, from a $10M company now. If we had three people who…you know, we have a couple in the building now and are shining stars. And if we had a couple more who I could rely on just to get shit done, it would fundamentally change our business.
SI: And it sounds like you resisted the move to a virtual company and hiring people who are not local.
SJ: Well, we have done that over time, and we’ve had to do that for graphic designers and some specialized functions, and IT. But it’s our feeling that having people in the building is the best way to run a business.
There were times when we drew a line in the sand that if we can’t fix our employee issues by date certain, we’re going to move the company to San Francisco. Instead, we bought the building we were in and doubled down and committed.
This is something you’ll get a kick out of. Perhaps not, but when new employees started – this is fairly recent – we would insist that everyone get loaded with their own Skype user name so they can communicate with the other employees about things, presumably related to work. Well, we terminated this one guy and, while shutting down his computer, we looked at his Skype chats, and there’s been this back channel communication, all of which used to happen at a traditional water cooler. Now when you walk by people’s desks, they’re busy typing and we thought they were working, but they’re talking about who got laid last night and what an asshole Scott is for six hours plus a day. And this is constant communication.
So we removed Skype from everyone’s computers and told them they can’t have their cell phones at their desks either, and gave out three written warnings and we’re about to accept a resignation of the third of the three written warnings. Having said that, you know, we have probably 14 full-time employees. We lose track of when they come and go – more regularly than I’d like – and we’re doing $10M a year and dropping a significant number to the bottom line after paying ourselves our base salaries. So we’re doing something right, but at a cost of our sanity.
SI: So let’s talk about innovation. You created the idea of putting pockets in the personal area network into jackets. How did you think about the movement away from the jacket to pants and shorts and t-shirts and everything else, and do you consider that innovation? And how do you think about innovation in general?
SJ: Well, I think you have to innovate. In our case we have kind of an interesting business model. I innovated, originally, by adding sleeves and adding more styles and adding women’s products. And then there are devices, you know, they change their sizes, so we changed sizes of some of the pockets and the like. But we’re constantly designing new products. I think it’s important, but not as important as most other clothing brands who feel the need to introduce things seasonally. I don’t think it’s as important for others because they’re competing against a buyer’s attention. Since we are the first clothing brand started on the internet, we have a direct to consumer model, which is fairly unlimited potential arguably. We have more of a timeless brand… some of the things in our line have been in the line for four or five or six years, and we just stop making them when they are boring. We do do things like occasionally a solar jacket and touch controls and the like. But those are really for PR value. We’d like to innovate in the level of service we offer, the personal shopping that we offer, and how we go about doing our business, and not necessarily feel that the products themselves have to innovate as much as a more mature industry with lots of competitors.
There was a company in Chicago that came out with a Kickstarter campaign that copied my products and raised an insane amount of money – $9.2M – in 60 days. What it showed us is that we have a larger market opportunity than we had perhaps thought, and we just need to get more people to know about us, and we need to address the millennial market. So not so sure it’s really innovation in terms of product necessarily, but innovation in management style, innovation in how we present our marketing, our products on line and the like.
Dan meets Scott at Silicon Valley Comic Con and shows off his Star Trek mods to the Sterling Jacket.
SI: Have you ever thought of doing things that are more pop culture-oriented? I actually get quite a few comments. I take the Sterling Jacket, put a Star Trek communicator pin on it and some pips on the collar, and that’s what I wear to Comic-Con.
SJ: That’s one aspect of innovation that we’ve been toying with, perhaps doing adventure shows and exhibiting at Comic-Con in San Jose. I’m going to be going to the Consumer Electronics Show in January, which we haven’t done in a while. And we’ll be exhibiting in South by Southwest. Recognizing when I’m here in Sun Valley, you know, I have a very limited reach, and I need to get out.
SI: Let’s shift gears a little bit. Do you have any tips or tricks or things you deal with for time management?
SJ: Well, time is my freedom. Time is everything. I basically try to accomplish as much via email and Basecamp as possible. We have a little game that my wife and I play. You know, as each email is read as a balloon that we pop up in the air, and how many of them can we have running on any particular day.
I have an insane number of emails that I manage on a monthly basis. I think it’s well over four or five hundred a day and subsequent email threads that I manage, which could include multiple emails.
So everything to me is a matter of speed. Getting my contractors on time management, on time tracking software called Harvest, and incorporating it into Basecamp has been really important. I insisted that all of my hourly contractors report their hours daily, so that I can track progress. I found as a lawyer if you do not report your hours, or record your hours daily, you are just making them up. And that is just a natural tendency for people, and you wind up making up hours that reflect how annoying your client is and not how much time you spent working on that. And whether it’s intentional or just human nature to recall the five minutes you talked to the asshole as being half an hour or an hour, that’s what you’re going to write down. So I find that if you write your time down contemporaneously, it will keep you honest.
Recognizing that speed is important – anything worth doing is worth doing fast, I really mean that. I think the longer you give yourself to do something, the more likely it’s going to be less efficient. If you set a goal, like we’ve implemented full ERP systems inside of 45 days. You know, others would give six, eight months to do that. And the starts and stops involved with long plans are highly inefficient. So when we decide to do something, we roll up our sleeves, and we do it quickly and then move on to the next thing. And hopefully, we’ll remember to measure back.
SI: That’s one of my least enjoyable things when I conduct education consulting because I’ll come in and say, ‘We’re ready to go, and here’s all the stuff and we’re going to go plow through it.’ And then it will be two weeks before I hear from anybody. I’m going, ‘What’s going on?’ ‘Well, we’re still adjusting to what you told us, and…’ And I go, ‘No wonder you’re not innovating. You want me to help you innovate and you can’t even start. Enough on that rant. So you said ERP system? Which ERP do you use? You mentioned you had Harvest and Basecamp.
P: Well it’s kind of funny, we started with one you won’t recognize. It wasn’t an ERP system; it was an order manager made by Stone Edge. It was order processing software, and it was running very slowly and sluggishly. So that president that we hired then hired very quickly a CFO and the CFO comes in and says, ‘Well you obviously need a professional system if you intend to be a $20M company.’
At this point, we were $6M or $8M or whatever. So we listened to the professionals and went with Netsuite, and he did a horrible implementation. He tried to do it, basically a migration of all the data himself, even though he had a budget to do it with. And he prepaid for three years’ worth of licenses on an expected growth pattern.
We later learned that the primary reason that we went to this system was order searching. When we wanted to look up an order, it took forever. Well, we replaced the memory chip for $70 and approximately $700,000 in costs for the ERP system was for nought. And we reverted back to that system and that’s what we’re working on now. So, we really don’t have an ERP system as a result. We use ActiveInbox a little bit for email and flagging, and Basecamp for project management. And that’s something that’s a constant effort, to make sure that we try to take things out of email as quickly as possible and have them trackable in Basecamp. And it’s a work in progress, but we’re a lot better this week than we were last week, and I hope I can say the same next week.
SI: Good. Yeah, that’s one of my areas that I do a lot of work in is the collaboration space. I work with a number of vendors, and I find that the practice side is where they all fall down. They’re happy to sell you technology but they aren’t very good at suggesting the best ways to use it.
OK, another left turn: philanthropy. So do you do things outside of the business, where you give time or money?
SJ: Our favorite organizations are local organizations. We kind of limit our giving to the local animal shelter, that is one of our bigger ones, and the hunger coalition. We’d like to do even more that is outward facing…My wife and I don’t have children, so you know everything is going to go to charity one day. We do try to give a great deal now as well. But we want to incorporate a charity called Pocket Change. You have change in your pocket that can make a change in someone’s life. We’re just trying to set it all up. It’s a little slower than we’d like.
SI: Have you taken a leadership role in any of those organizations?
SJ: No. I really have not, other than offering, you know, my image if they want to use it here and there for local charities. I have not invested any real-time.
Having said that, this weekend I did have a really amazing opportunity. It was my birthday. I was in San Francisco, and I didn’t have any real plans, and I posted on Facebook, ‘What should I do?’ and someone said, ‘You should go to the food bank and help the church hand out food.’ So at 7 a.m. on Saturday morning, I walked up to the church and started volunteering for several hours, and it made a significant impact in my life.
I was the guy who was at the door, and I’d welcome people in and, you know, they’re used to just saying, ‘Okay, you can come in.’ The bigger I smiled, the bigger they smiled back, and the happier it made me and the happier it made them. And so I’m trying to incorporate some of those lessons that I learned, that experience, into the business. I think there’s something to be said that positivity attracts positivity.
We also offer our employees an opportunity to support local charities, of which we’ll match. We try to do a lot of those things. It’s a bit disjointed the way it comes off, and I’m not sure we’ve really figured out how to maximize it. But we have lots of interesting programs with our employees. We have people coming in and doing workouts. We have powder days. We have a massage therapist that comes in once a week. We have a climbing wall. And our home is right above our office, and…that’s awesome too. So, you know, there’s lots of unique things recognizing that working with people is important, and making the workspace great for everyone.
SI: Yeah, it was funny. When I went to work with Forrester Research, they were in Cambridge Massachusetts, and I was in southern California at the time. They put out a corporate memo, saying that if you hang your clothes in this closet, by 3 o’clock the dry cleaner will come pick them up and they’ll bring them back the next day. And those of us who worked remotely said, ‘What happens if we put the clothes in our closet? Does anybody come? One of my hats was to help nurture the relationship the remote employee, to help set expectations. We had regularly scheduled calls to talk about how we’re not in the office and there are certain perks we don’t get because we’re not there. And talk through that versus people grumbling, as you suggested that they did on the backchannel of Skype, regular phone calls so people could talk about it out loud and we could address them – and to talk about the perk of working at home and not commuting.
So you’ve talked about being hyper-local, doing a little bit of outsourcing, but the manufacturing is certainly not local, how do you deal with your outside vendors and communicating product designs at a distance.
SJ: Oddly, I’ve never been to China. I’m the only company in the world that’s been running a business for this long and never once been to my factories. It’s kind of interesting. I deal with them… by speaking in utter clarity. A lot of the management lessons that I’m employing are based upon the relationships I’ve developed and the communication style I’ve had with China. When you’re developing a product with as many details as a ScotteVest you have to speak with utter clarity. Your drawings have to be great. You have to use Skype, you have to indicate ‘noted’ or ‘done’ inline responses – I try to encourage all my employees to do that.
In terms of other contractors, individuals, I’ve met most if not all of them. Occasionally I fly them out as needed for sessions if need be. I find that they’re never as productive as they ought to be or should be.
SI: Meetings with the Chinese are often very interesting and the meetings feel very odd to Westerners at the beginning of those relationships. Have you ever had any issues with IP in China?
SJ: Yeah, yeah, I have. You know, someone registered my brand name. I had to fight to get that back. I was told I would not get it back. And you know, fortunately, I did, but it wasn’t without a $50,000 fight to get it back. And you know people registered my patent rights there. All the IP issues you can expect, I’ve dealt with. I have another one of my suppliers knocking me off it’s been kind of a nightmare.
SI: Two final quick questions: After all of your learning, what’s the piece of advice that you would give to any manager who is coming up saying, ‘Scott, what’s the one thing I need to know?’
SJ: Some of my management styles are really obvious. I go and talk to students at schools and I say the one thing that’s made me successful in business is quite simple, and it’s FU. You know? I Follow Up on everything I start, and most things I start start in an email, so I flag them until completion. it’s shocking how many people really don’t adequately follow up on shit to get it done.
I don’t know if that’s management or time management or just obvious. I mean, everything I’ve ever done has gotten done because I have followed up until it’s gotten done. So many people just think, ‘Oh I’ll start it, I’ll send an email, they don’t respond, I tried.’ And they feel good about themselves. The other person didn’t, you know, this or it got lost, and it never gets done. If you add up all those opportunities and it’s a lot of loss. I start out every day with 125 emails that relate to a prior period. Iit doesn’t take that long to act on it. It’s a simple email saying, ‘Where do we stand’ or ‘What are the next steps’ or pushing it back, but it’s FUing everything. Everything worth doing is worth following it up until it’s done.
SI: Okay, perfect and…
SJ: I wrote an article about it in LinkedIn. It’s on my blog (link here).
SI: And I’m assuming in your book – thank you also for sending me a signed copy of your book. I appreciate that. [My pleasure]. What’s your “blurb” for Pocket Man?
SJ: You know, it’s unlike any other business book you will ever read. It really is. When we were looking for people to read it and get their feedback, we asked what book it was most similar to. My favorite response to ‘What business book was it most similar to,’ someone said, ‘The movie Ferris Bueller’s Day Off’. (chuckling). It’s constant movement; it’s constant speed; it’s storytelling. You know, it’s not intended for me to say, ‘This is how you can be successful’, although if you read it you’ll be able to pull some things out of it.
First and foremost, my goal was to entertain, and I think I achieved that. What it all boiled down to is to be a passionate personal promoter. Don’t be afraid to promote yourself, and do so very very passionately. I know it sounds so generic when I describe it that way. Like, no shit. But you’d be surprised how many people don’t.
The other thing I would tell aspiring entrepreneurs, not necessarily managers, although it does apply to managers as well: don’t wait for the business or product that no-one’s ever done, or to build that better mousetrap and get a patent, thinking that the royalties are going to come in quickly. A lot of entrepreneurs put much more stake in the idea rather than the execution. It’s all about the execution. So stop wondering what the perfect idea is. Take one and just do it better. Do it faster, do it better, market it better, do it more passionately.
SI: Yeah, I agree. I teach a strategy class, and I have people ask me about the Blue Ocean strategy, and I’ve gotta find my thing, and I go, ‘No, why don’t you go learn how to do a thing first and then do it really well. And if you happen to have a really good idea, you’ll have good fundamental principles to execute on that idea. But just go do something really well first.’
All right, well great. I appreciate the time and opportunity to catch up.
SJ: Awesome. Thank you very much. I appreciate it.
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Daniel W. Rasmus
Daniel W. Rasmus, Founder and Principal Analyst of Serious Insights, is an internationally recognized speaker on the future of work and education. He is the author of several books, including Listening to the Future and Management by Design.