Executing better. Going from 1 to 10 to 100
New businesses are exciting places to work. They also are very messy places to work. Fast growth is everybody’s dream. But without clear structures, priorities and processes, such growth causes significant confusion and is highly stressful for all involved. Distractions are everywhere. And run around like a headless chicken for too long and the entrepreneur not only fails to make any progress but rather even risks killing the fragile new enterprise.
Initially, founders still somehow manage to balance most priorities in their heads, fighting hard to “hold things together”. They tend to have a reasonable sense of what matters most. However, as companies grow, this decision making approach doesn’t scale. Employees are brought on board yet struggle to understand how to immediately provide most value. Keeping external stakeholders updated and aligned becomes tougher and tougher. And as the overall speed and complexity of the business increases the founders and key people become increasingly overloaded.
Given many entrepreneurs strong bias for action, startups rarely suffer from lethargy throughout this period. Somehow everybody seems to be working very hard, what more can be expected? Yet effort does not always equal output. Ask any given person “why” exactly their current task matters for the big picture and answers tend to be vague. Even more so if you ask about how somebody else’s tasks contribute to the overall success and “why” they matter.
In an attempt to align everybody, founders or even investors then respond by setting some high-level aspirational goals to “inspire and align the company around a common purpose”. The actual impact on daily operations though is mostly limited as the follow-up question to any ambitious goal statements must be a discussion around the “how?”. “How?” will this goal be achieved and what actions are expected from the other people involved.
This article proposes a 5-level framework to create an appropriate support structure for new ventures to, bluntly spoken, “execute better”. This means executing faster (through improved alignment), more efficiently (through reduced waste and clearer responsibility split), more predictably (through explicit goal-setting) and ultimately in a more sustainable manner (through creating strong structures building “organisational muscle”).
This framework is not meant for companies still at the idea stage. Rather, it is for organisations with a basic product or service in place and some financial and human resources available. This often means at least 6–12 months of operating history but based on circumstance could even be significantly longer. These organisations typically are trying (and struggling) to “get to the next level” without any clear model or structure in place.
The 5 Levels framework
Despite the overall framework consisting of 5 levels, it is designed to be lightweight and versatile to allow for quick roll-out with its benefits becoming visible almost immediately. The actual number and type of documents created (e.g. spreadsheets, documents, diagrams) throughout the process can vary by company but generally does not exceed three. Further, if focusing on this framework, most companies should have the rough overall framework in place after a few 2–3 hour sessions over the course of 1–2 weeks. This relatively short timespan and investment is due to the fact that the framework’s primary value is in structuring and formalising knowledge that implicitly exists spread-out across the organisation.
Level 1: The one-liner
Level 2: The organisational brain dump
Level 3: Identifying key strategic priorities
Level 4: Defining the required roles and goals
Level 5: Determining key priorities by goal and identifying the big bets
Level 1: The one-liner
This one-liner is the guiding principle of what the company does. It could be in the form of what conventionally would be referred to as a mission statement, e.g. “to feed the world” or a vision statement “a car-light society by 2030”. The key is to define a simple and memorable statement, known and internalised by all involved stakeholders. What is it in less than 10 easily understandable words that your company does. This can be an emergent theme and often the first 6–12 months are formative for reflecting on what “really matters” in what your company offers. This one-liner then serves as North star and core purpose for the organization. It focuses the entire organization on a cause and helps rally employees around a common shared purpose. For any given task or activity undertaken by the company, ultimately it must be possible to map back to this one-liner by asking “why” often enough to ensure all energy is focused on relevant work only.
Level 2: The organisational brain dump
The big picture is exciting and exhilarating. Yet strategy and planning discussions in growth-stage ventures are often painful for people concerned with execution due to the stark contrast between strategic opportunities available and the limited executional bandwidth. This gap is further worsened due to a lack of planning and in-depth thinking about what really is required in order to achieve certain goals. The plethora of ideas on what could be done needs to be parked somewhere so that the organisation can confidently spend its attention on the most immediate opportunities, knowing that “the big picture” and various major and minor ideas will not be forgotten.
Some form of mind map hereby seems particularly suitable to offer very basic clustering and organise this largely unstructured information. Conducting this as a team exercise further allows everybody to share their ideas, ensures they are heard — even if obviously not every idea will immediately be implemented — and can foster further excitement around the joint cause.
To keep the mind map reasonably accessible, a threefold split has proven useful, categorising various and ideas keywords into sections for product (i.e. the value proposition of the venture), market (i.e. everything marketing and distribution) and organization (i.e. everything related to building the actual organization like overall strategy, HR, finance etc.). As the organization matures, obviously, a different split may be more appropriate as long as there is some basic structure.
Level 3: Identifying key strategic priorities
Level 2 provides a broad yet unstructured overview of the strategic opportunities the organization has collected internally and externally. Level 3 is all about going deeper on these and making the tough choices needed to define the 3–5 (max) key themes to focus on over the next 1–2 months. Organisations should feel very confident about the significant ROI of these priorities in terms of effort spent, in particular in comparison with the many other opportunities.
Typically, these key priorities cut across multiple roles and functions. They are the key bets placed by the company in order to make significant progress towards the goal described by the one-liner of level 1. Whilst they still tend to be too big for specific roles and people to work on, they give a good first-level answer to the question of “how” to realise the ambition defined in level 1. Being cross-functional, they clearly show which roles and people need to coordinate their work to ensure that the overall goals are realised as quickly as possible. Few things are more frustrating to a company than if a development team rushes to build a feature, just for the marketing team not to be aware and have any supporting launch materials (or vice versa).
1. Build sports car
2. Use that money to build an affordable car
3. Use that money to build an even more affordable car
4. While doing the above, also provide zero emission electric power generation options
(Tesla’s “Secret 10 year master plan” from 2006)
Level 4: Required roles and goals to execute
When looking to scale, companies commonly have basic operations and some staff in place. Structures often are heavily influenced by certain historic reasons, opportunistic hiring of people with different experiences and skill sets, various experiments and generally a lack of clear understanding of the ideal organisation structure required for achieving the company’s vision. This includes tasks being assigned based on individuals instead of roles, unclear interfaces and responsibilities between various people and a lack of overall alignment regarding the “how” to achieve the overall one-liner vision.
On level 4, the leadership team therefore looks at all the current resources, the key strategic priorities and defines a clear set of roles required to implement these initiatives. Each role hereby has a simple, 1-sentence goal describing the “why” — the purpose for why that role exists.
The assumption hereby is that hitting all these separate goals will, taken together, lead to the organization enjoying a significant boost towards the overall goal from level 1. Further, by breaking the roles down and defining clear goals per role, these goals can be assigned to individuals leaders. Such leaders are empowered through their new and clear mandate, hence, can fully focus on driving the organization towards their goal without requiring micro-management from the top level.
Jointly defining and reviewing these roles & goals is also a fantastic opportunity for the people working on the frontline to reflect back with the leadership team on what they have learnt about the business and market. It helps easily visualise what is keeping everybody busy. Further, it is extremely powerful in mapping whether the organisation really is allocating resources in line with their stated objectives. If the organisation is meant to obsess over customer satisfaction but there is no clear role with the stated goal of maximising customer satisfaction, quite obviously something is off.
Level 5: Identifying the big bets and key priorities by goal
Level 3 defines the overall 3–5 key company priorities describing the “how” to realise the one-liner purpose statement. Level 4 describes the roles and sets a clear goal for each role. The fifth and last level now puts the emphasis on the individual leading each role. Provided with a clear goal and understanding of the overall direction of the company, it is their responsibility to identify the 3–5 most urgent tasks required to deliver upon their goals.
With the clear “why” for each task in place, impact can be predicted and resources (whether time or money) roughly estimated to understand potential ROI and prioritise accordingly.
Carefully looking at the goal will typically quickly lead to understanding at least a few major areas required to achieve that goal. As an example, if an HR lead is supposed to build a highly engaged workforce, asking “how” will lead to a range of ideas including for example looking at employee satisfaction and turnover rate. Understanding the facets of the role also then allows to determine what kind of metrics make most sense for each role and help the individual measure their progress.
Getting started with this
To get started, founders can just pick one of the levels and start jotting down thoughts. Level 1 is a simple sentence; Level 2 could be a mind-map; Level 3 could be a written document. Level 4 & 5 could be one or multiple spreadsheets with a column for each role and Level 3 strategic priorities cutting across roles. Appreciating the different levels of abstraction and “just getting started” are the most important aspects.
Given this is about sharpening the organisational focus and thought-process, it is likely that initially the five levels are not entirely consistent. The company may be distracted with some activities that actually do not matter that much after all. And other goals may lack a clear “how”, hence, require more thought and potentially even new roles or key tasks to be allocated. Treating the documents produced as living and evolving items, continuously referring back to them for all daily work as well as periodically reviewing them overall makes them among the most important tools of the company.
However the organization ultimately uses and documents those five levels though, at the core of it are two question. Link upwards by asking “why?” — why do a certain activity, why have a certain role? Worry about execution, ask “how?” — how can we reach that goal, how can we do this task, how can we succeed.
Above introduction admittedly lacks a comprehensive real-world case study. Whilst I have applied this framework multiple times now, obviously a lot of the results are not appropriate to be publicly shared. A very basic generalized template for Levels 4+5 can be found here: http://bit.ly/startup_roles_goals
Feel free to ping me to discuss and share any attempts of your own implementations of this framework. Given enough interest, I hopefully will make the time in the future to develop an entire case study providing more comprehensive some sample documents etc.
Special thanks to Alex Holroyd-Smith, Reuben Lee, Bui Hai An and Tu Vu for their valuable input in developing the framework and this article!
