Full warning, this article is going to be pretty polarizing. It outlines what it takes to be a successful business and the hallmarks of a failing business. It highlights the people who drive the biggest impact and those that are dead weight holding the business back.
Here's my underlying argument: Your work doesn’t matter…
I hate thinking about it this way. I bet you’re not comfortable with that statement either. But it is the hard truth.
If we're honest with ourselves, most of our work doesn’t make any impact for the business. It’s a waste of time. This also means the vast majority of work within a business is pure waste. I’m going to share some examples which relate to software products and technology projects, but make no mistake. This applies to everyone… our first example can be a subject that everybody loves… banks.
Banks are insanely wasteful when you factor in the potential upside of automation and digital products. Banks invested $700 BILLION in technology projects in 2022. You’d expect a huge return on that right? Well in the years since this investment, the ROI fell well short of expectations. It’s an ongoing trend since the 90s. Having worked with a wide variety of banks, it’s clear to me that the underlying culture values lists of projects that are delivered on time and on budget. Making an impact is just not a priority in this environment.
So what do you get? A huge amount of time is invested in upfront planning of the work and decisions which reduce perceived risk. Due to the lack of outcome thinking, the risk of the product failing is not factored in at all. And herein lies the problem…
Forrester reports that 85% of the products and features fail due to poor market fit. To make matters worse, 31.1% of tech projects are cancelled before launch. If you are only focused on “delivering the thing”, then the likelihood of your project not being cancelled and actually delivering a truly successful outcome is only about 10%.
That’s pretty low odds, however the gravity doesn’t quite hit you until we consider what this means across the business.
Imagine you pull together 10 product engineering folk from around the business and put them in a room. You’ll find that 9 out of 10 of them are working on something which is a total waste of time. If this were a manufacturing process, the management would be dismantled in a matter of days.
What about startups and scale ups? Is this still a problem? So far I’ve been talking about established businesses. Ultimately, they can handle the loss. They can ignore the waste. Sure, you might dislike knowing that your effort is wasted (more on what to do later), but the business will roll on for now. But what if you’re just starting out or scaling up? It’s a death sentence.
There is no secret as to why OKR is so popular in Silicon Valley, the cradle of the world’s most successful tech business. Done right, it forces focus only on what is critical. Nothing more. This acts like a filter. Start-up and scale-up businesses who use a strong lens to say yes to only the critical things, tend to be successful. Their practices are shared and celebrated. For the vast majority of them, it’s either OKR or something like OKR (there are many ways to win this game).
Those who fail to have focus, tend to never find market fit, have blowout operational costs and eventually die off. The worst part about this is we tend not to learn the cost of not focusing.
Very few people are willing to go public after leading a catastrophic failure…
So, what to do then?
Stop working. Stop committing. Stop batching your work. Stop blindly executing.
Before you exit this tab into oblivion, stick with me…
Having led my share of hot-mess projects over the years, I learnt one thing that defined success. It’s what got me started with OKR sometime around 2010. Committing to a list of features was always a game of lost hopes and dreams for stakeholders. They wanted the product to do all of the things. The more features the better. In practice, we know that all you end up with is a Homer Simpson Car. Loads of features, expensive to deliver and something which no one wants.
If we align on the impact we want to make, then the conversation shifts to the outcome. We optimise for impact. Here’s where my next technique comes in. Stop batching.
Most products and projects are released in one or two big hits. This is called batching as you’re building everything up before shipping it and moving onto the next batch. The issue here is you’re betting the house in one fell swoop.
In this mode we might still be focused on the outcome, but features will still be stuffed in. Stakeholders fear they will not get another go, so we need to get everything in this project. We see the same habit from a technical perspective. We bake in lots of extra things because we might need them one day or we’ll never get back to fix it. This is where the term YAGNI comes from “You Aren't Gonna Need It”.
So instead of batching, we want to break our work down into lots of small iterations. Removing as much of the unnecessary work as possible, and only delivering the bare minimum needed to deliver the outcome. We also track progress on the outcome, but launching the project one little bit at a time to see how the customer responds.
When we test the work as we go, we’re no longer blindly executing. We’re validating progress as we go. We’re challenging every bit of work we do and check that it makes the impact we expected. Yes it’s hard work, but it’s the only way to cut the waste and be sure you’re maximizing your impact.
What’s left? Oh, Stop Working… to make all of the above happen, you’ll need to down tools. Pause, step out of your business and reflect how it works. You’re getting off the dancefloor and onto the balcony. Imagining the system of work from a third-person perspective.
From this stance, you can see every component, how they interact, and begin to reset the mindset. This is a journey which requires a shift in culture, mindset and process.
I hate to say it, but shifting to outcome thinking is a journey. You will get there one day and the dividends it pays for your business and your career are wild. Like all things, you should enjoy the journey as much as the destination. You can have a hell of a lot of fun along the way.
Have any OKR questions? Let me know as it helps me learn about the challenges people are facing!