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The core of your business should be built around things that people are going to want today and 10 years from now.
A podcast by 37signals about the better way to work and run your business. Hosted by Kimberly Rhodes, the Rework podcast features the co-founders of 37signals (the makers of Basecamp and Hey), Jason Fried and David Heinemeier Hansson sharing their unique perspective on business and entrepreneurship.
Shaun Hildner (00:01):
Welcome to Rework, a podcast by Basecamp about the better way to work and run your business. I'm your host, Shaun Hildner, and as always, I'm joined by Basecamp co-founders and the authors of Rework, David Heinemeier Hansson. How are you today?
David Heinemeier Hansson (00:12):
Good, good, Shaun.
Shaun Hildner (00:13):
And Jason Fried. How are you?
Jason Fried (00:14):
I'm all right. Thank you.
Shaun Hildner (00:16):
All good. This week, we're going back to talking about what things we should be focusing on when building a business. And in this case, I want to talk about focusing on the things that customers will always want instead of chasing that next big idea. So what's wrong with following the hot new trends and chasing down new technologies?
Jason Fried (00:35):
I think the idea behind this essay was actually advice we got from Jeff Bezos years ago.
Shaun Hildner (00:41):
Oh, okay.
Jason Fried (00:42):
He was basically saying that you can chase, you should innovate, you should look... Well, not chase, but you should innovate and come up with new ideas, of course, but if you double-down on the things that won't change, they'll always pay off. Those investments will always pay off. And his example was people aren't going to wake up 10 years from now and wish that it took longer to get a package from Amazon.
Shaun Hildner (01:01):
Yeah.
Jason Fried (01:02):
So they invested in distribution centers all over the world. They've invested in their own shipping company. You can see that the investments they make there will never not be worth it because there's some new fad that comes around kind of thing.
Jason Fried (01:15):
He also said, people aren't going to wake up 10 years from now and wish things were more expensive at Amazon, or people aren't going to wake up 10 years from now and wish customer service was worse. There's a set of core things that the business should do really well, and you got to figure out what those things are and focus on those things without losing focus on other new things too. But don't just focus on new stuff and let the basics sort of crumble.
Shaun Hildner (01:41):
Yeah.
David Heinemeier Hansson (01:42):
I would say it's partly an investment strategy that if you're going to put your money into something that's going to pay off in only one year, holy shit, that's going to be an amazing idea. Right? Some new trends are that, but quite few of them, versus if you're investing in something that you can essentially amortize over five, 10, maybe even 20 years, you're pretty well off.
David Heinemeier Hansson (02:07):
And while we, in this essay, focus on the customer, invest in things that the customer would want, that question pertains also to everything on the inside. Are you investing in the kind of features of your company itself that are going to pay off over the long term? Right? Are you investing in having long-term employees? Are you investing in having software that you can build up expertise over the long term, or are you constantly jumping from one thing to the other? Whether between people or policies or technologies, they have a very short time to pay off the investment, which just generally doesn't pan out, unless you have the magic touch and you keep picking the right lottery numbers. Well, good for you, if that's you. Most mortals have to play the odds, and the odds are you need a bunch of base hits.
Shaun Hildner (03:00):
Sure.
David Heinemeier Hansson (03:01):
Can't stake it all on like, "Oh, it's going to be these home runs." Now, that can be an argument for just overly conservative management of things. Well, we're going to invest in the things that we always did because those were the things we did and they paid off in the past. And that can lead you into a blind alley, for sure, but if you have a base of 20 of those things, and then you go, "You know what, on these two things, we're going to take a long shot, mix it up a bit," but the long shots and the new technology, the fad, perhaps, idea is the small part of the portfolio and the large part of the portfolio is just getting the basics right.
Shaun Hildner (03:38):
So what is that sort of unmovable rock at the core of Basecamp as a business or as a product, I suppose?
Jason Fried (03:44):
Well, I think one of the things we've really invested in from the start is customer service. It's so fundamental, and I think we're exceptionally good at it, and I think customers who interact with our customer service team see that we're a company that cares about their success and cares about helping people for real, compared to a lot of companies, you try to get in touch with them and maybe you heard back from them three days later, or four days later, or five days later, or maybe never. And this is especially true with something like HEY, which is our email service. We actually provide customer service on email, which is just, that does not... You really can't email Gmail and get an answer.
Shaun Hildner (04:23):
Yeah.
Jason Fried (04:23):
And so we've just said it's incredibly important that we do this really well, that customers feel like and know that we're standing behind them. There's real people here. We don't send automated responses. We don't have bots answering questions. We have human beings answering question from other human beings. And usually, you hear from us within the hour or so, sometimes within a few minutes. And that's just something that it's expensive to do. A lot of companies out there see it as a loss, which is why you call a lot of companies and you're on hold forever and they connect you with someone who just doesn't have any power or really knowledge.
Shaun Hildner (05:02):
Or it's outsourced completely.
Jason Fried (05:03):
Or outsourced completely, and you can see what that means. It's like, well, they say they care about their customers, but they're outsourcing their customer service.
Shaun Hildner (05:10):
Yeah. Interesting.
Jason Fried (05:11):
So I think that's one example of something that we do. There's other things as well, but I think that's something we've done from the beginning and it's been very important for us.
David Heinemeier Hansson (05:20):
I think it's a great example, too, of how some companies, for example, they have live chat support. And what I've found is that that live chat support is a product they bought from someone, and it's not even the same support department, and in fact, they can do less. And this is one of those areas where you go, it's a checkbox feature, oh, we have live support. And then you try to actually use the thing and you realize that this person doesn't know anything. They can't do anything. As soon as you have an actual problem, you're just wasting your time talking to this individual on that end of it, and what they'll tell you after wasting your time for 20 minutes, you're revealing all my customer service scars, "Call the hotline." Right? So now, you wasted 20 minutes on this interactive thing, and now, you're going to call the hotline and you're going to be in line for 40 minutes until you get an actual person. Right?
David Heinemeier Hansson (06:09):
And this is where the investments also connect on the inside. Why is the customer service at Basecamp good? Well, part of it is because we set up some policies that enable the people who work here to make a wide array of decisions and actually be able to help someone because they have some latitude to be able to do that. If someone is just reading off a script and that's all you get, there's not a lot of latitude there. Right? And I think that it's those kind of things combined with, for example, the setup that we have, people on customer support, who've been with Basecamp for over 10 years.
David Heinemeier Hansson (06:47):
At a lot of companies, as Jason said, customer support is a cost center. And what happens with a cost center is you try to minimize the cost at all cost, and oftentimes, that means just having not great working conditions, which means that people are not likely to stick around, which means you have a higher churn, which means you have a bunch of new people who don't know all the tricks and who haven't been there for a long time, who can't provide the kind of service that someone else would talk about.
Shaun Hildner (07:15):
Yeah.
David Heinemeier Hansson (07:16):
This connects to another essay, I think, we have in the book that's everything is marketing, that customer service, for example, and investing in that is not just about providing the customer service. It's also providing the marketing through being the kind of business that people would talk about. "Do you know what, I had this problem with Basecamp." Or with HEY, HEY is perhaps, to some extent, the better example that Jason says, because the contrast is darker.
David Heinemeier Hansson (07:38):
I've never talked to a single individual who told me about a good experience they had writing Google about anything [inaudible 00:07:45]. Literally, I'm trying to think that's actually quite remarkable. Google is in everyone's life. Everyone touches Google to some extent. I cannot recall a single interaction I've ever had with someone who said, "You know what? I just had an amazing experience with Google customer service."
Shaun Hildner (08:01):
I don't think I've ever talked to someone who's gotten ahold of Google's customer service.
David Heinemeier Hansson (08:04):
It probably starts there. But even if you do, that's just not something people talk about. Do you know what though? Jason, just this morning, I think yesterday, we continuously shared the feedback we get from customers who are shocked at the level of customer service ticket. They're shocked to the point they're writing a separate email to us just to say, "Holy crap, that was amazing. Marisa did the most wonderful job on this," or "Chase did the most wonderful job on this, or someone else on the support team did such a above-and-beyond job that I am writing you to just tell you about that." That's something that's never going to change. Are we going to have customers asking us questions about the products that the pay is for tomorrow, next year, 10 years from now? Absolutely.
Shaun Hildner (08:51):
Of course. Some of the other things you mentioned are speed, ease of use, simplicity. When designing new products, are these still the things you focus on or do you focus on that kind of the new idea first?
Jason Fried (09:04):
We try. It's not always the easiest thing to do. It's actually probably the hardest thing to do, is to make the simplest version of something that does the most it needs to do, but nothing more kind of thing. We're building this new feature into HEY right now, this kind of snooze feature. And it's really straightforward, and it's really a neat thing. It's really simple, and the domain language is great, and the words are great, and the feature's great.
Jason Fried (09:29):
There's a lot of other versions of that we could have done. For example, you'll be able to push an email off to another day, right? But you can't pick the time. So you can't say, "Snooze this until Friday at 3:00 PM." It's just snoozed until Friday. And it doesn't sound like a big deal, but it kind of is a big deal because we chose not to have the time. Times actually add a lot of complexity for a variety of different reasons.
Shaun Hildner (09:55):
Yeah.
Jason Fried (09:56):
And Friday just means Friday morning. So I think we bubble it up at 8:00 AM or something like that, and that's basically enough. If you need it Friday at some point, it's around Friday at some point, versus having to dial in your precision about when it pops up and all that stuff.
Jason Fried (10:09):
So that's just an example of... We thought about that and we said, let's just simplify that's enough. This feeling of enough is something we get to a lot. So that's something we are always thinking about and always have been thinking about. I mean, products naturally get more complicated as... Or more complex, I should say, not complicated necessarily. That's what you don't want. Complex is different. Complicated is harder to use. Complex just means it can do more things.
Shaun Hildner (10:32):
Sure.
Jason Fried (10:32):
I think that's something that we are still conscious about, is we making more complex products that don't feel complicated.
Shaun Hildner (10:39):
Yeah.
David Heinemeier Hansson (10:40):
I think it's one of those areas, too, that is such an interesting trade-off sometimes because you can take a product like Basecamp and say, "Wow, it does a lot of things," and it does, but is that more complex than trying to string five different products together and integrate those and set them up if you actually need those things? Oh, you need a place to store your files. You need some to-do list. You need some chat. You need some messages. If you were trying to weave your own sort of carpet together out of a bunch of separate things, each of the individual things might look simpler, it just focuses on one thing, it's just files, yeah, but if I can't solve my problem with just files, it's not less complicated.
David Heinemeier Hansson (11:27):
So I think we're often weighing those things that Basecamp has simple versions of a lot of features, but it does have some complexity in the fact that it tries to solve a substantial number of problems that people often think, "Do you know what, let's just solve one little slice of it," which is a thing I've often been very interested in on the technical side too. That's the same thing Ruby on Rails does, is to try to solve all the common problems around, "Hey, I want to build a new web app." You can be much less complicated than Rails is if you just only give yellow blocks of the length four, right? Thinking the Legos. That's just... Do you know what? It's actually quite complex to build the thing you want out of just yellow blocks length four. If you have a few more colors and a few more lengths and different sizes, it actually becomes easier to build the thing you want.
Shaun Hildner (12:24):
Yeah.
David Heinemeier Hansson (12:24):
And that's the hard trade off, I think, for us because we so willingly go in and go, we're going to accept some complexity to here because we're trying to solve a whole problem. Can you run your company on Basecamp? Could you do that? And we've arrived at an answer that's almost yes. If you look at Basecamp, our own company, company of almost 70 people now, we more or less run the company 80 to 90 to 95% of the time just on Basecamp.
Shaun Hildner (12:55):
Yeah. Can you think of a time where you found yourself falling into the trap of maybe chasing down a new design trend or some hot new technology just for the sake of wanting to do the new thing and it sort of pushes the core beliefs out of the way?
Jason Fried (13:10):
I remember there was time when there was this era of widgets and card-based interfaces, where everything was a card and it was the future of web design or something, and it's like... And I think we explored that quite a bit actually with the first version of Basecamp 3 before Basecamp 3 changed into what it is today, but everything was this card and cards were sort of stacked and sort of stacked in a brick format and would kind of fill in the space, and it looked really good. It had a visual appeal, but practically, it wasn't there. And that's fine that we explored that, but I think we wouldn't have explored it had it not been the thing to do at the time. That's one thing that definitely sticks out. I don't know if there's any technical things, David, that you've... I know you've always been sort of pushing against the trends on that side, but-
David Heinemeier Hansson (14:08):
Yeah. I think this is one of the things we still struggle with, and sometimes the struggles change. So for a long time, especially with Basecamp, one of the technical operating principles was to have screens that just did one thing, don't have seven different features that all pop up into little things on a single screen, and we stayed quite militant to that to a point where some individual screens we have, they're little weak actually, because they do too little. Right?
Shaun Hildner (14:38):
Sure.
David Heinemeier Hansson (14:38):
It's always a trade-off. It's always a sort of a full spin. And we did it in part because at the time, with the technology we had, what we were trading off was speed. If you have to render seven things on a single page and the page can't render until you have all the seven things ready, it's going to take longer than if the page did one thing. [crosstalk 00:14:57] we get the pages to be so fast that you wouldn't feel it was a problem to change between pages.
David Heinemeier Hansson (15:03):
And we pursued that for a while and sometimes didn't, and then we ended up with a few pages that were in that quick, because they were trying to do five things at the same time. And sometimes, that's also where that tension becomes between the different disciplines, that design once one thing, "Hey, it'd be nicer if this was just an overlay in line on a thing." And tech goes, "That's actually not that great performance," and these other things.
David Heinemeier Hansson (15:26):
And then sometimes, you have these unlocking technologies. For us, that was Turbo in Turbo Frames. Technologies is a part of this new hot wire thing that we're doing in building our front end with and we build all of HEY with. It just allowed us to do new things that all of a sudden, you could have the seven things on a page by loading them individually in a way that wasn't complicated. And that allowed us to design some or move closer on the technical end to what sometimes was the natural inclination from design.
David Heinemeier Hansson (15:56):
But actually just yesterday, I think it was, we were discussing on a mid cycle review this one design for a feature in HEY, and we were going down the path of like, "Ah, well, if it just updates part of the screen," and we're like, "Why is it just the link? Could it just be a link that replaces the whole screen? Would that be good enough?" And they're like, "Oh yeah, that would solve a lot of problems we're dealing with here, trying to figure this, that, and the other thing out." And then we did it.
David Heinemeier Hansson (16:21):
And I just saw this morning that the feature shipped. So we went like, "Do you know what, just do the simple thing." You don't have to get a hundred percent fidelity out of everything, especially this feature, which is not a feature you're going to use 700 times a day where the micro fidelity is in high demand, and it was just more important to ship it. So that's an example of sometimes the environment changes. So you make a certain set of decisions and trade-offs at a given time, and then certain things get easier and you can make some different trade-offs, but you're still trying to hold on the fact that for the environmental factors that are present, we're going to do the simpler thing.
Shaun Hildner (17:00):
So is it about waiting for that new trend or that new technology to settle into a place that it does accommodate your core focuses on things that won't change?
David Heinemeier Hansson (17:11):
I think it's more just about is it there? Can we do it in an easy way? I mean, we've never been apologetic about the fact that one of the components in choosing how to build something is how quickly can we do it?
Shaun Hildner (17:23):
Yeah.
David Heinemeier Hansson (17:24):
You know what? We might have an idea for a feature, but if that idea is manifested in a very complex way that would take a long time to build, go outside of our six-week cycles, we're just not going to do it.
Shaun Hildner (17:36):
Yeah.
David Heinemeier Hansson (17:37):
So we let the environment and the materials influence our design decisions. We like to call it cutting with the grain. You can cut with the grain of the existing technology you have. You can cut with the grain of the web. You can cut with the grain of your environment. And that makes things easy, but that sometimes means you have to change your mind. Right? You might have a design in your head that isn't cutting with the grain at all, and that just means it's cumbersome. It's hard, and it's going to be more code. It's going to take longer to maintain. You're investing in complexity, which those are generally not the greatest investments.
Shaun Hildner (18:15):
Fair. Well, I think that's a pretty good place to stop. Shall we open up the old listener mailbag?
Jason Fried (18:19):
We need like a sound effect though, of the crinkling of envelopes or the opening of a velour velvet kind of bag or something.
Shaun Hildner (18:27):
I mean, I could just record me plugging my phone into this microphone right now. Here, we have a question from Peter.
Peter (18:35):
Hi. I really enjoyed Jason and David's conversation and response to the question about metrics in a recent episode. As a product designer, I'm very conscious of the drive at many companies to do "data-driven design". I've always preferred a more data-informed approach. I'm wondering what the Basecamp product team's approach is to this. Thanks.
Jason Fried (19:01):
The first thing is I think to recognize what kind of work you like to do. This is sort of maybe a weird answer, but I've always been personally more gut-driven, intuition-driven, which sometimes works and sometimes doesn't. I wouldn't take as much pleasure in just designing to the data, and I don't think I'd do as good of a job if that's what I had to do. So part of this, I think, is just understanding what kind of organization you have and what kind of organization you want to be and what drives people.
Jason Fried (19:32):
We use data to inform a variety of different decisions, but it doesn't tell you what to do it. It provides a picture of history. And then from that point, you can derive some intuitions and some ideas. There's some times you use it to figure out how often is something going to be used, how often is something used. For example, I'll give you a quick example. So Laura, who runs our customer success team, is interviewing customers right now. And we have a feature in Basecamp called automatic check-ins, which we use religiously at Basecamp. It turns out they're not really frequently used by a lot of other companies, and a lot of people find them to be annoying.
Shaun Hildner (20:11):
Sure.
Jason Fried (20:12):
And so the question is, what do you do with that information? One is you could say, well, people don't use them, so let's lose them, but I don't think that's actually the answer. Part of it might be we can change the behavior. So right now, we, by default, begin to ask people questions when they sign up, and we could maybe turn that off. That would be something that could be something that's driven by data.
Jason Fried (20:35):
It's also driven by qualitative research too, that she's talking to people and are saying this, but it's also then quantitative as well when we start looking at percentages. And then you can go, well, this feature is still a good idea, but maybe we're putting it too upfront. Maybe it's distracting. Maybe people don't understand it initially. And so we're hitting people too early with it, and it's sort of in the way, and they get frustrated by it. So what can we do to dial that down? So that's a data and qualitative-based information that's sent to you, and then you come up with an idea based on that.
Jason Fried (21:04):
So I think we do use that. We do do that, but as far as coming up with new ideas, we typically are coming up with those, putting them into the product, and then we might come back and see how they're working, or we might have some ideas on how to change them and tweak them after that. But we typically push things live and ship stuff that we feel good about first versus trying to feel certain about by using data that may or may not actually accurately reflect what we're trying to decide.
David Heinemeier Hansson (21:34):
I think it comes back to using data almost as a sort of a customer sounding board or whatever, focus group, and goes back to Ford's thing, what the customer wants as a faster horse. You have to follow your intuition for putting new things into the world, and then you can use the data to render a verdict. Did it work? Did people use the thing you created?
David Heinemeier Hansson (21:58):
Now, your creation has to be novel, or at least that's how we're doing it, right? We're informing our creation of new things often to quite a militant way. We were talking another episode about how version one of HEY was basically just the version of email that Jason or I wanted. No input, no data, no market research of anything, this is just pure instinct, gut instinct. And then once it's in the wild, you can look at like, well, what are people using? What are they not using? Take some feedback after the fact.
David Heinemeier Hansson (22:34):
I think you have to have that intuition. You have to have that taste. You have to have that direction. This is why you're here. You're not just a sort of conduit for requests and numbers and like, oh, they come in, they [inaudible 00:22:49], and then they get formed into features on the other side. No, I don't think that works very well.
David Heinemeier Hansson (22:55):
And this is one of the problems when you talk about metrics, you often talk about sort of the tyranny of metrics. And one of the primary tyrannies of metrics is the fallacy that the only thing you can manage is what you can measure. So if we can't measure whether a feature is working or not, it means it's worthless. No. There's the idea of complimentary products and complimentary features, and even if I don't use something all the time.
David Heinemeier Hansson (23:21):
You look at this with cars, for example. EVs have faced this problem with range anxiety forever. And why is it there? Because, yeah, twice a year, I take a road trip that's longer than 300 miles. You'd think that's not a rational reason to buy a combustion car, but people do, and they do it for that reason, right? So sometimes, you have these very rare things that need to happen that actually is underpinning the whole purpose of buying the thing in the first place. So you got to be really careful with metrics because metrics appear as though they're truth. That's the real problem with them.
Shaun Hildner (23:53):
Yeah. The numbers can't lie.
David Heinemeier Hansson (23:55):
Right. Which they totally can't, and they don't lie by being wrong about the thing they're measuring. They're lying by being wrong about how important that is and how unimportant all the things you can't measure is. Right? They're focusing errors. They drive you to focus on that one thing you can measure, and now, that's how we gauge whether this is success or not, when in fact it could be a million other things. You just haven't figured out how to measure or you can't measure.
David Heinemeier Hansson (24:22):
And then you ultimately have to fall back on the ultimate measure - is the business doing well? Which is one of the things I've always respected Apple for, this thing that they don't have individual business units, that they're not breaking it out like that, that the end of the day, there's one number for the business, and that's how kind of whether it does well or not. And that allows you to do things that can't justify themselves on their own merits, and sometimes, those are the most magic things of all. And you become a different kind of company, I think a hollow company, a pretend scientific company, if you only focus on the things you can measure.
Shaun Hildner (25:00):
Yep. Well, perfect. Thank you, Peter. If any of you out there have a question for Jason or David, leave us a voicemail at 708-628-7850, or better yet, record a voice memo on your phone and email it in to hello@rework.fm.
Shaun Hildner (25:15):
But that will do it for this week. Next week, we're going to be talking about Van Halen, golf clubs, Photoshop features in the essay Tone Is In Your Fingers. So hopefully, I'll get both of you to join me next week, but for now, I want to say thank you to Jason Fried.
Jason Fried (25:33):
Thanks, Shaun.
Shaun Hildner (25:34):
And thank you, David Heinemeier Hansson.
David Heinemeier Hansson (25:36):
Thanks.
Shaun Hildner (25:37):
We'll see you next week.
David Heinemeier Hansson (25:38):
Alrighty.
Shaun Hildner (25:50):
Rework is a production of Basecamp. Our theme music is by Clipart. We're on the web at rework.fm, where you can find show notes and transcripts for this and every episode of Rework. We're also on Twitter, @reworkpodcast.
Shaun Hildner (26:03):
If you're following along with the book, next week, we'll be discussing the chapter Tone Is In Your Fingers. And if you like the show, I'd really appreciate it if you would leave us a review on Apple Podcast, Spotify, Overcast, or wherever you're listening to this.