It was a summery, typical Tel Aviv evening when I got THE phone call from my friend, Maya Prosor. Maya and I hadn’t spoken in months, but I knew that when Maya calls, you answer, since, statistically speaking, 99% of the time something really good follows.
I was just getting back from a company event at TASC management consulting, my workplace and second home at the time. Maya knew how much I loved consulting, but she also knew that as a graduate of the IDC’s (The Interdisciplinary Center Herzliya) Zell Program, I’d been flirting with entrepreneurship quite a bit. Being the natural salesperson she is, Maya had only one request: “I’m joining a new team that is just getting started and the co-founder and CEO really needs a Tiano (my maiden name). Please meet him.”
So I did. When Daniel Schreiber and I met to explore joining Lemonade, he didn’t know exactly how to define what he needed. His brief to me was, “I’m a manager who doesn’t like to manage or be managed and I need you to do both… Oh, and, you should manage the company’s strategic plan and how we define and measure success. Someone told me that in the US they call it Business Operations, or BizOps.” Daniel’s brief added up to be a pretty accurate description of what BizOps grew to be at Lemonade.
Building a hyper growth company is extremely complex. You’re selling dreams you haven’t quite delivered on yet and as soon as you launch, it’s no picnic. In addition to satisfying investors and employees, you have to follow the voice of your customers and there’s always a team out there that is better funded, has a larger team, and is closer to market. Many founders and early executives I’ve chatted with mentioned that, “by the time I got a hold of something… the challenge outgrew the building blocks I managed to set up and I found myself playing catch up.” Sound familiar?
Building muscles, especially in a startup’s early days, takes time. You need to define the operating model, hire the right people, develop processes, tools — and all that while defining the values and DNA of the company plus making sure you have enough money in the bank to sustain the operation.
In other words, the nature of a startup is that complexity grows exponentially, but the infrastructure required to handle the complexity grows linearly at best.
This means that no matter how talented your team is, it’s almost impossible to keep up. There’s always a gap between what you need to do and your current ability to deliver on it. This is where BizOps thrives.
If the company is the human body and the founders are the brain and heart of the body, BizOps is the neural system. The different functions (engineering, finance, BizDev, etc.) are the muscles the body needs to develop and BizOps is in charge of making sure the body builds and maintains the muscles it needs to crawl, walk, and eventually run. BizOps has to be able to develop a capability and then move on to the next area of impact. It’s very tempting to position BizOps as the solver of all problems, and have it manage different operational functions, but by doing that, you create a dependency on BizOps that dramatically lowers its effectiveness. If BizOps needs to manage other functions (Office Ops, CX, Sales Ops, etc.) they too need to hire people, train them, set processes, and eventually are drawn into managing the day to day. That takes away BizOps’ agility and doesn’t enable jumping from one point of impact to another.
How BizOps Operates
So how does BizOps close the gap between the challenges at hand and the infrastructure needed to develop, you might ask? Like many great things, there are three fundamental pillars to BizOps. The first is serving as the founders’ commando unit. Everything the founders worry about becomes something that BizOps should worry about. This means using a data-driven approach to find the gaps between challenges and capabilities, and then planning and executing ‘special ops’ projects to close those gaps. These projects look a lot like management consulting projects. You partner with the relevant teams, deep dive into the data and make recommendations for change. However, there’s one dramatic difference between a management consulting project and a ‘special ops’ project, and that’s implementation. BizOps makes the recommendation for a change, but then also implements it and sees it through. You need to collaborate and facilitate collaboration between teams, so they can continue to operate and grow when you have already moved on to the next area of impact.
The second pillar of BizOps is to instill ‘data fluency’ in the company. Data is a language and like other languages, just because you learned some French in high school doesn’t mean you can necessarily use it to convey complex ideas and drive change. BizOps is there to develop the fluency of the data language within the organization. This is especially important in a company that strives to be non-hierarchical and encourages ideas to come from every direction and every level. In these companies, data is the language by which decisions are made and is the currency used to prioritize. By using data to help the company define its KPIs (key performance indicators), BizOps helps craft the company’s success story, focus on what matters the most and push the right initiatives. They are the authors of the dictionary, making sure metrics across the organization are consistently defined. They write books, narrating the success of the company through dashboards and insight digests, and they teach the team how to write and speak the language by training to self-serve analytics.
The final pillar of BizOps is facilitating and managing the execution of the company’s strategic plan. At Lemonade we tried many strategic planning processes until we came across OKRs, which took us to the next level. OKRs, Objectives and Key Results, strike the right balance between providing strategic focus and enabling the agility required in order to act in a constantly changing environment. By defining ‘WHERE we want to go’ (the objectives) and ‘HOW we know we got there’ (the key results) we are able to grant the teams the flexibility to define ‘WHAT we need to do in order to get there.’ BizOps is instrumental in facilitating those discussions with the founders, at the company level and within the different teams. They make sure the objective touches the most critical areas of impact and that the KPIs and targets (i.e ‘key results’) really measure what the objectives intended.
OKRs is where all BizOps pillars come together: data fluency throughout the organization allows the democratization of initiatives while maintaining the focus on the most impactful ones; OKRs allow the identification of gaps to be closed by the ‘special ops’ projects; lastly, OKRs set the strategic cadence, the heartbeat of the company, providing the flexibility of teams to execute as they see fit, while holding them accountable for outcomes rather than outputs.
Why hire BizOps early? Why now?
Some founders might say “this is too much philosophy and theory for the early days of a startup; I need builders, working hands, and can’t afford to invest in BizOps on day 1”. I get it. I really do. Being a founder means making tough tradeoffs and sometimes it means prioritizing the here and now. At the same time, being able to be strategic about the company’s needs in the near future is what really sets seasoned founders apart from newbies. If you ask second-time entrepreneurs what they would have done differently, you’ll rarely hear, “I would have hired more people in year 1.” Most of them would comment about lengthening their line of sight, developing the capability to foresee challenges that were lurking all along and setting better infrastructure earlier. By hiring BizOps early, you increase the company’s chances of becoming strategic and data-driven earlier and really instilling a culture of long-term thinking and real impact.
As we move from ‘startup’ nation to the era of ‘scaleup’ nation, the need to think strategically is no longer what differentiates the good from the great. It’s an absolute necessity. This requires a skill set other than product, engineering and growth that for so long dominated the tech industry in Israel. So how do we attract that talent into the tech industry? I might be biased by my own experience, but I have a great conviction that ex-management consultants are the answer. They are highly trained at unpacking and solving complex problems using data, and are accustomed to changing subject matters constantly due to the nature of the project-based work they do. This is not to say that all BizOps people must have consulting backgrounds. It is to say that in order to systematically scale-up we need to tap into an already existing pool of talent. However, having a consulting background isn’t enough. Management consultants are great in observing from the side and wowing clients with recommendations that too often don’t see the light of day, as they are not tailored to the client’s ability to execute them. One thing that I found in common to every great BizOpser is the lack of satisfaction from consulting life. A great BizOpser is a frustrated consultant who is so eager to see their recommendations implemented and yet so rarely does. Most of them describe how they wish they could do more to ensure the success of their clients.
Often, management consultants’ career paths lead them to an executive position with a client. It is up to us, founders and BizOpsers, to change that. To find the ones who think differently, who are passionate about building and about leaving their mark. It’s up to us to help them channel those energies to building smarter, bigger and more strategic tech companies. There’s a great pool of talent looking to make a greater impact, not knowing where to apply their passion. Let’s join forces and make sure we ‘scale-up’ the Israeli tech industry and harness local talent to do so.