017: The Squeaky Wheel Fallacy – Why Most Startups Don’t Invest Enough in Their Best People and Customers

I call it the squeaky wheel fallacy: When you run a startup, there will always be vociferous customers and team members. They’ll be very vocal about all the challenges, problems, and struggles they encounter with you.

And because they ask for your attention, they get it.

On the other hand, there are those that are just silently performing:

Team members that deliver results without making big waves about it. Customers that keep paying you for years and years, without ever making much of a fuzz and requiring many support or Customer Success resources.

And because they are not asking for your attention, in most typical startups, they don’t get it. Even though they deserve it.

In this episode, I share how to not become a victim of the squeaky wheel fallacy, and how to allocate your time, attention and resources in a smarter way.


So here’s a phenomenon that is super typical in business as well as in life in general. Probably that poses a big missed opportunity. Most companies and most people, most of us will spend most of our energy and most of our attention with team members and with customers that aren’t working out. Well, I think about it when you have a personal, your team that is underperforming, typically that person will get.

An increased amount of attention, resources, and energy from you, right? You’ll notice it. You’ll spend more time with that person. You will try to coach them more. You will try to collaborate more with them. You’ll try to communicate more. At some point, you might have to do a performance review. You’re going to spend a lot of time worrying about them, thinking about them, looking over their shoulder, looking at their work, looking at their improvement, trying to decide how to help, and then trying to track if the help is working.

Well, if it isn’t and what needs changing, they all consume all your attention, all your energy, until they’re back on a place where they’re performing really well. And that’s sort of kind of natural. But you know, and the same thing is true for customers. If you have a thousand customers, guests, which one customer will get most of your attention, typically the one customer that complains the loudest.

Right? The customer that is sending you a huge long email about all the problems you have, the customer that is threatening to write a blog post or a review or talk to their network about the poor experience they’ve had with you, the customer that is. Negotiating and renegotiating and reread, negotiating the contract with you, like whatever customer, you know the squeaky, what is it called?

The squeaky wheel gets all the grease, right. Where is the loudest typically gets the most attention and that’s natural. There’s something natural about that. The problem in both of these examples is that we spent way over proportional amount of our energy and attention with. Kind of the weakest links, the employees that aren’t working out that well and the customers that aren’t working out that well, and what do we do with the best performers?

Think about it. Think about the person on your team that is crushing it. It is killing it. That is kind of, you know, performing the best. The person that just shines and over achieves. And surprises and impresses you consistently. What do you typically do with these people? I mean, you love them, right? You really appreciate them in your heart, but usually you spend less and less time thinking about them.

You don’t worry about them. You don’t micromanage them. You don’t check in as much. If you have one-on-ones on your book and you’re their manager, maybe you’ll skip a bunch of them because there’s really nothing to discuss because they’re just crushing it. Right? You give them more and more independence, which is a beautiful thing.

A can be a beautiful thing, but what does it mean practically? Well, practically it means you spent less and less time, energy, money, and attention investing in them. The same thing is true for customers. Maybe even more so, think about your best customers, some of your best customers. They just pay all the money, never asked for a discount, never negotiate anything, never need any help, and I just happy all the time.

What do you do with those customers? In many cases, in many businesses, you just forget about them. I mean, it’s, that sounds harsh, but it is the reality because they’re quiet because they never make any noise. You don’t think about them. Think about these suitcases. They represent a massive loss in opportunity.

We need to invest in our best people. We need to invest in our best customers. We need to reward both of them, and we need to reward them, not by micromanaging them. But by giving them energy, time, attention, and resources to go from amazing to even better, to even better. Like if an employee’s amazing, ask yourself, what could I do or a team member of yours?

What could I do to empower this person to do even better? What resources could I give this person? What promotion, what. Salary increased, what bonus could I pay this person? What could I give this person in terms of research and resources, coaching, time, energy, money, what could I give this person? What investments could I make?

Since this is a stock that is rising, why wouldn’t I want to spend more and more of my money and more and more of my assets and putting them on this person. Ask yourself that question, then execute on it. The same thing is true for customers. If you have a customer that just loves your product, gets a lot of success from it, and never needs any attention and help, that’s awesome.

But ask yourself, what could we do if we invested more proactively into that relationship? Could we help this customer get even more value out of our products? Could we help this customer be more of a spokesperson for our business and our brand? Could we empower this person to be a bigger champion?

Could we invite them on panels at conferences where we speak? Could we interview them for a podcast or a blog? Could we share more of their content and more promote more of their business? Could we help them become even better users of our product and platform? Could, could we reward them with. A discount or some bonus or some gift.

What can we do to invest in this relationship and ensure that they’re getting more and more and more successful as they continue being great customers of ours? Those aren’t difficult questions and those aren’t actually difficult tasks. You’re going to enjoy speaking to that happy customer and giving them one other new tip for them to crush it even more, to be even more successful.

That’s going to be an amazing call. You’ve got to love spending some more time, golden and a walk with at rockstar employee and learning more about them and giving them more money or resources or time or ideas, and then seeing them flourish even further. That’s going to be amazing. That’s going to be fun.

Instead of just spending most of your time with the problem cases and the issues of the things that aren’t working out with the customers that aren’t happy with the employees that are unhappy. You aren’t doing well, of course you have to spend some time with those, but don’t spend all your time on problem cases.

You have to invest practically. In areas that don’t urgently require your investment, but would pay the biggest return in dividend to you. So here’s what I want you to do. I want you to write down the name of one person in your company, in your team that is amazing, and that because they’re so amazing, you’ve spent very little time thinking about or working with them or investing into them.

Write down one name right now. And then make a commitment. Put this on the calendar as soon as possible to spend an hour with them as an exploration call and just focus on the question, what can I do to help you do even better? And when they tell you nothing, because that’s typically how these people think, right?

They’re so happy. They’re like, Oh, I don’t need anything. Everything’s fine. Don’t take their first answer. Don’t accept it. Go, okay, I get that you’re doing beautiful without my help, but let’s stay with that question for a bit longer. Think about it a bit harder. What could help you double your results?

Move much faster. What’s something that’s a little bit of friction I could remove from your life or from your work? Stay on that question. Don’t let them get away with just telling you that everything is fine. Stay on that. Push challenge them. I guarantee you sooner or later they will give you some answers and then you’ll have your homework things to do to invest in them and do the exact same thing on the customer side of things.

I want you to think of one customer right now you love because they love you back. One customer that always positive. It’s been with you maybe for a good amount of time and that if you’re honest, you’ve not really spent that much time worrying or thinking about that customer, helping that customer practically write down that name one customer name, and then do the same thing.

Put a time on the calendar within the next 14 days to talk to them and to find out ways to help them do even better. Do that and then make it a habit and make it part of your culture to invest and double down on the people and the customers that are working and that working out that are doing well and that are silently happy and don’t require a lot of your time and attention.

Make sure you keep investing in them, even if they don’t ask for it and it’s going to pay massive dividends back into your business.

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