Toggling to public & annual thinking
One of my goals this year is to share more writing with more people. Tactic #1 is to pull shareable things out of private channels, and share them.
This is from an email I send to some of the founders I work with.
I talk a lot about context because most business and leadership problems begin as context problems and end as communication problems. Context problems are when people don’t know what they need to know to make good decisions and meet expectations. Communication problems are when people don’t succeed in communicating what they expect.
The new year is a great time for kicking the tires on context.
Building Context - annual thinking for founders
1.1.21
Happy New Year. I hope it will be a year of growth and renewal for all of us, our businesses, and the world.
Each year, we work to rebuild the context of your business. Most of the work we do together depends on it. Strategy issues depend on context to make better decisions. Management issues depend on context to enable better performance by your teams. Leadership issues depend on context to create the conditions for cultures of growth and achievement.
Your business competes in a context, and that context will always change faster than you can. It’s your job to try keep up.
To that end, here are some recent reminders of the context equations I recommend processing your business through as a leadership team. The goal is not certainty, but clarity on the information you have, the decisions you’re making, and the tradeoffs they create with your expectations, time and resources.
The Business Equation
Are the table stakes of your business still clear and sound?
Context Questions:
- How much demand is there for what for what we’re selling?
- How much of that demand can we capture and satisfy?
- How much does it cost to capture and satisfy that demand (with happy customers)?
- How repeatable is our process?
Resource:
- Justin Jackson (twitter thread)
The Retro Equation
Do you know what mattered over the last year, and what tradeoffs you’ve made?
Context Questions:
- Rank by impact 10-15 initiatives from the prior year
- Review questions:
- How many of the bottom initiatives would you trade for one from the top?
- Which took the longest?
- Which took the shortest?
Use the exercise to:
- Instigate the right kind of conversation around what outcomes matter
- Bring to light the tradeoffs embedded in the strategic decisions you’ve made
- Reveal where more learning and more measurement must be baked into the process
Resource:
- Rank Your 2020 Initiatives (John Cutler)
The Strategy Equation
Have we connected our strategy to our activity?
- What is our winning aspiration?
- Where will we play?
- How will we win?
- What capabilities must be in place?
- What management systems are required?
Resources:
- Playing to Win (book)
- A Playbook for Strategy (pdf)
- Strategic choices need to be made simultaneously, not sequentially (HBR)
- Playing to Win: How Strategy Really Works (Farnam Street)
The Change Equation
Finally, context is the environment for change. Most change fails, and most businesses fail as a result of it. The hard work on leadership is understanding the needs, gaps, and drivers that will enable your business to become what it needs to be to succeed.
Noah Brier, founder of Variance.com & Percolate, has a useful framework for thinking about systems change and its set of component drivers.
Each enables a different organizational behavior. And the absence of any has direct executional effects:
- Vision </> Confusion: Why are we doing this?
- Skills </> Anxiety: How do I do this? Am I not doing my job well?
- Incentives </> Resistance: What’s in it for me?
- Resources </> Frustration: Where is my support?
- Action Plan </> False Starts: Another one?
Assess your gaps, and plan to address them.
Resources:
- A field guide to driving change - Noah Brier
Addendum: Just ran into this post by Hunter Walk on OKRs, and how early stage co’s should think about goal setting:
What would I recommend for the Maker-side of early startup companies instead of Quarterly + Calendar Year Annual? These three:
One Month — “What are we building this month” is the key question. Team leads get together the morning of the Monday prior to month’s end and document the next month’s feature releases. This is a bottom up process which includes items shipped completely intra-month and component work of projects which are greater than 30 days long (if you can’t break a complex project into at least 30 days goals, then it’s too big). Four weeks, a few weekends. Enough time to get a lot done. You don’t need to micromanage — for example, if the team spends two days per month bug fixing, just hold that time aside in your calculations, don’t document the bugs you intend to fix.
“N+12 Months” — “What will our product and business look like a year from now?” I like the idea of a rolling “one year out” vision, processing new learnings and opportunities. At any given time the entire organization can have a true north for where we want to be a year from now. It evolves, it learns, it doesn’t tick down to zero but rather always looks out over the horizon.
Minimal Quarterly/Annual KPIs — Recognizing that quarterly and annual goals are important for financial reporting and goaling, you should keep a very narrow grasp on what you actually want to measure — just key drivers of business — and set quarterly targets. There can be a reality check — do these quarterly targets get achieved given what we’re building?
For me, Monthly Goals combined with N+12 Goals create the right short-term Maker cadence with longer term vision. I never got the chance to try it at Google, but hope to find companies using this sort of planning cycle to see how it works for them.