Pouring out the jellybeans
Q4 is the time of year when most companies plan their strategy for the next year. Depending on the stage and nature of the company, this can be an informal process between co-founders on a spreadsheet, or a formal multi-month process with various stakeholders and approvals.
Jim Collins in Good to Great talks about ‘Stop Doing Lists’. The annual planning process is a great time to formulate a list like this headed into the new year. It’s easy to not only have too many initiatives for the following year (Fred Wilson blogged today that the ideal number is 3–5), but to also carry forward initiatives that no longer deserve the resources or support of the business.
Stopping activities that are already embedded in the organization is often much more difficult and emotional that cutting down a new initiative list.
Last week I attended a talk by Dwell CEO Michela O’Connor Abrams who described her company’s planning process. At the end of every year, her leadership team sets priorities by ‘pouring all of the jellybeans out on a table’, and then decides — one by one — which jellybeans to put back in the jar for the following year.
I thought this was a nice way of describing how to build a continuous improvement culture where all ideas can be shared and there are no sacred cows. Too often business activities that add no strategic value, or used to work and now don’t, survive for years, sleepwalking their way through the organization year after year.
Jim Collins coined talks about ‘conducting autopsies without blame’ when things go wrong — however often waiting until things go wrong doesn’t account for the opportunity cost of doing things that aren’t fully broken, but also not leading to a strategic outcome.
This practice should apply to all companies of all sizes and industries. I’ve seen plenty of startups that thought they were the disruptor turn into the disrupted because they were holding on too long to things that weren’t working.
Time and money are both highly scarce commodities in companies. Its important to constantly reassess whether these resources are directed towards the highest value activities.