Whenever a boom comes around, I read articles about how it’s dangerous to be too cheap and too cautious.  One saying I learned during the last boom was “You can’t save your way to prosperity.”

Maybe.  But as you start to hear the siren song of profligacy (last time, we called it “Get Big Fast”), remember that history teaches us that capital efficiency is one of the most important traits of successful companies.

I had breakfast with a VC from a top-tier firm this morning.  He told me that his firm had commissioned a research project to investigate how much capital VC firms deployed in their best investments versus the rest of their portfolio.

The answer stunned them: $2.7 million.

The investing principle of cutting your losses and letting your winners run would seem to predict that top investments would receive more capital.  Instead, their research showed that the most successful VC investments typically consume far less capital than the average investment.

I’m not surprised.

One of the lessons I’ve drawn from studying the great military strategists of history (Hannibal, Alexander the Great, Napoleon) is that successful generals are economical in their use of manpower.  They don’t commit all their forces to every battle.

What sets them apart is their uncanny ability to sense the critical moment during the battle when it pays to take decisive action.  It is then that they commit their reserves, turning a close fight into a stunning victory.

As an entrepreneur, think of yourself as one of these great generals.  Be a cheapskate, and conserve your capital until you have eliminated enough risks and uncertainties to allow you to sense the turning point.  Then step on the gas.

One clear way to distinguish between a good organization and a bad one is to look at how it handles disagreement.

The mark of a good organization is that disagreement leads to improvements in the business.  The mark of a poor organization is that disagreement leads to a worsening in the business.

In the chaos and uncertainty of the startup environment, disagreement is inevitable.  Good organizations make sure that disagreements are heard, and that the relevant team members work together to find an acceptable resolution.

In contrast, bad organizations either fail to focus, or end up battling internal rather than external foes.

The temptation exists to ignore disagreements and simply hope that they go away.  This may seem attractive, but becomes quickly untenable.  Startups don’t have the resources or the time to vacillate or pursue multiple approaches.  Everyone has to agree and work towards a single focus.

I’ve seen teams of smart, talented people who didn’t have the discipline to resolve their disagreements, and they almost always head south.

Remember, of course, that resolution doesn’t have to mean that everyone agrees…what it does mean is that everyone agrees on what course of action the company will pursue–even those who disagree.  You can’t let people employ the passive-aggressive approach and just take their ball and go home.

As a side note, I feel that a lack of disagreement is also a warning sign.  Given that there are seldom clear right answers, a startup that lacks disagreement is either not trying, not thinking, or not composed of human beings.  A talented team consists of people with different backgrounds and skills–they are bound to disagree on some things.  The trick is how you handle those disagreements.

You hear about transparency all the time.  “We’re in a new era of transparency.”  “We live in a transparent society.”  But I can’t help feeling that while transparency is all around us, when we ask about the benefits of transparency, we often get an opaque answer.

Transparency is in danger of becoming yet another buzzword, like “long tail” or “Web 2.0″ whose clarity of meaning is inversely proportional to its usage.

For me, transparency is important because it is a prequisite of collaboration.  I think about this all the time in the context of a business.  In most businesses, what people do and how they are performing is incredibly untransparent*.

Many people instinctively fear transparency.  “If everyone can see what I’m doing, maybe they’ll figure out that I’m not doing much!”  Or, less cynically, “I haven’t got time to explain to everyone what I’m up to.  I’ve got work to do, for cryin’ out loud!”

But as an entrepreneur and leader, I need transparency.  Especially in a small company with little room for error, I need to know what’s going on.

Startups often have greater transparency than larger companies simply because of their size; if everyone is squeezed into a single room, everyone will have a pretty good idea of what the others are working on.  But even a one-person company can benefit from transparency.

If you need to make your tasks and priorities clear to others, you are forced to make them clear to yourself.

And once you make your tasks and priorities clear to others, they can help you.  That’s collaboration**.  But if others don’t know that you need help, or how they can contribute, don’t expect them to spend their precious time dragging it out of you.

For example, one simple way I’ve promoted transparency is using a wiki (from my investment PBwiki, of course!) to maintain tasks an priorities for each person in the group (this could be a workgroup at a larger company, or the entire company in the case of a startup).  I ask each person to answer a few simple questions:

NAME’s Job Page

1. My areas of responsibility are….

2. My three top goals are….

3. The tactics I plan to use to accomplish these goals are….

4. My key projects are….

5. The ongoing tasks I perform daily/weekly are….

6. The tasks I want to complete this week are….

7. I’m depending on other people for….

8. Other people are depending on me for….

9. Other thoughts….

While at first it may seem like a pain to keep something like this up to date, it takes only a few minutes a day, and has the added bonus of making it abundantly clear both to you and the folks you work with what you’re up to.

The key is questions 7 and 8–by making it explicit what you need from others and inviting them to make it clear what they need from you, you minimize the chances of nasty surprises as deadlines draw near.

If you want to use PBwiki for your own transparency project, visit the Transparency Project wiki that I’ve created to copy the page template, or live a completely transparent life by posting your own page to the public, a la 43things.  Give transparency a whirl, and let me know how it goes for you!

* Sales people are the exception; I met with one of the top executives at Salesforce.com recently, and he explained how their sales model is a well-oiled machine, with about 10 key metrics that they watch like a hawk.  Any time one of the metrics deviates from its customary range, they know that they need to fix the machine.  Try that with any of your other departments!

** Of course, you do need to make sure that your colleagues are capable of helping you.  Check out my post on “Feel for the Game” to determine if they can.