15 Jun Visions: Chicago software exec Jason Fried breaks (almost) all the rules
Milwaukee, Wis. – He shares company secrets. He thinks business meetings can be “toxic” as well as costly. He believes in small, two-person project teams to improve the flow of communication, and he thinks employees must be given ample “alone time” to accommodate “REM work.”
There is a method to Jason Fried’s alleged madness, and he shared some of his insights at the recent Wisconsin Entrepreneurs’ Conference in Milwaukee.
The founder of 37signals, a Chicago-based, web-hosted software company that is not afraid to spill its secrets in a very public way, Fried hopes 37signals will shatter the taboo about sharing business formulas. The company has disseminated its knowledge through a self-published book titled Getting Real, a well-read blog (Signal vs. Noise), and occasional seminars.
In Fried’s way of thinking, if successful television chefs can write cookbooks and give away their recipes, why can’t businesses get over their fear of calamity if their competitive secrets get out?
In other words, you can either outspend the competition, or you can out-teach the competition. In the spirit of open source, it’s an attitude that also exposes a train of thought within a company that increases the understanding of where its products might be headed.
“I think in most cases, that fear [of ruin] is overstated,” Fried said. “The best way I’ve found to get press is to share.”
“Getting” web-based services
Other than Fried’s oft-stated mantra of keeping software simple, he said there are two things people don’t “get” about web-based services. First, they are a timesaving alternative to installing programs, yourself, and they are more secure than people think. Fried, in fact, believes web hosting is much more secure when done by a reputable company with redundant servers and the ability to stay more up-to-date on the latest patches – and patch management is a challenge for consumers and businesses, alike.
37signals does this with a staff of eight people, four based in Chicago and four scattered throughout the country. As such, it knows about working with remote employees and the collaboration tools necessary to foster effective communication.
Basecamp, the company’s hosted project management and collaboration tool, has high customer satisfaction ratings, but there is an anecdotal metric that Fried cites in demonstrating that the product is reducing technology implementation failures. In some cases where companies haven’t purchased Basecamp, IT professionals employed in these organizations are shelling out their own money to manage projects with it.
“A lot of people are using Basecamp as an end-around for their IT departments,” Fried said. “People are buying Basecamp with their own funds and are using the product for IT projects. They think it’s worth the $50 a month to do a project right.”
The company’s products are built mainly for individuals and small businesses – what 37signals calls the “Fortune 5 Million.” While some companies are spending thousands of dollars on projects using Basecamp, with some projects spanning as long as two years, others still are leery about using a hosted solution, especially on larger, high-risk implementations.
Due to their own set of guidelines, units of government are similarly hesitant even though non-profits have put the product to good use. The American Red Cross and other relief agencies used Basecamp to share ideas and plans in the aftermath of Hurricane Katrina.
To explain the reluctance, Fried used the term FUD – Fear, Uncertainty, and Doubt, “something a lot of IT folks spread,” he said – but he believes that will change over time.
In 2007, 37signals’ philosophy – solve simple problems simply – will be trained on its existing applications, including integration between products that now are walled off from one another. In addition to Basecamp, the suite includes Highrise (for tracking leads), Campfire (group chat), and Backpack (information organizer, calendar).
Next year, it plans to build new applications around measuring the performance of business, and it also would like to build a customer support application. That sounds like a piece of cake for someone who was involved in the development of the program framework Ruby on Rails, an increasingly popular tool among web application developers, but Fried doesn’t leave much to chance.
As usual, the new products will be developed for 37signals’ own use before they are introduced to the market. “We wouldn’t build a product for the healthcare industry because that’s not the industry we’re in,” Fried said. “Fundamentally, the products we build are for ourselves.”
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