How to Make Good Decisions by Sharing Goals and Plugging Holes

After working with a couple of product and engineering teams across many years, one thing I constantly observe, especially in Singapore (although the same could be said elsewhere for sure), is that very few can think from first principles. This in itself is not to demean. It is rather highly likely due to the lack of mentoring people have, hence, the same mistakes repeat themselves over and over despite the tech industry having forerunners for decades leaving us a trail of lessons to learn from.

A recent conversation I had with a product manager (and this happens all the time of course, so I’m not pointing to anyone in particular), has to do with trying to identify the first principles of his assigned vertical. For example, if I am a product manager for Carousell’s activation and retention, my north star should be looking to reduce the amount of time and effort it takes for the buyer and the seller to close the sale. I of course should have my own monitoring set up to see how the funnel looks like, monitor dropoffs, where they happen, and behaviors that lead to a successful sale within a specific time threshold (i.e. what percentile of sales close within 10 interactions and how can I keep reducing this threshold while maintaining the percentile and/or increase the percentile for the same threshold).

Now let’s say another product manager is heading user acquisition. New users apparently take a longer time to adapt. Hence, a sales cycle for a power user will show very different behavior than a new user. If this person’s north star is acquisition, he then has to cast as wide a net as possible. What that means is that as the density of new users increases, it also dilutes the north star of the activation and retention product manager.

Now here’s the problem: if one product manager’s north star cannibalizes the other, are they then to lock horns? And if so, how can a company succeed when everyone’s locking horns with each other? Of course, a company that tolerates a culture where one team wins at the expense of other teams ends up sawing off the branch it's sitting on. When a company is forced to decide between two competing goals, it must be smart enough to get the owners of these goals to collaborate, think outside the box, and find a shared north star.

For example, if the activation and retention PM is to be mutually successful with the acquisition PM, the shared goal might actually be around increasing top line, increasing bottom line, a combination of these, or perhaps others.¹

Many a time, staffs take a narrow view to their own peril. Still, blame is hard to attribute. People do not wake up one day and decide to take a narrow view. Rather, it must be attributed to inexperience.²

How then, can a company solve this? A company solves this by making clear what the collective goals are and rewarding behaviors that support this. When people are brushed off, silenced, spoken over, and so forth… these are all ingredients for disaster. In fact, one may go as far as to say that when the company has brilliant jerks, they have to be eliminated as soon as their usefulness to the company reaches its limits (and they often reach their limits early because of their refusal to collaborate). One study shows that in order to offset the damage a brilliant jerk creates, the company needs to hire 2.4x top performers.

Recently I had a conversation with an engineer who noted a leader well liked by his team because he “protects the engineers from product” but disliked by everyone else. The question must therefore be asked, “what price does the company pay for the protection of engineers?” The answer is itself. The business is sacrificed on the altar of self-preservation. When the business is sacrificed, everybody loses.

Another problem company runs into often is that there’s a significant power gap between the boss and the staff. I once worked with a team where I hired a junior staff fresh out of school. I felt the staff was tremendously slow and I could do in one hour what he could do in sixteen. I was unhappy with his performance. However, his manager told me, which of course is true, that my perspective from the top is very different from the bottom where the poor chap is trying to figure his way around and didn’t have all the knowledge I had.

Of course, I can be the nice guy to mentor him, or I can be the ax-wielding boss who fires the guy and hire someone more senior. This goes to show that companies also require mid-level buffers to bridge the power gap. I once thought that senior executives were hopelessly narrow-minded in the way they treat juniors until I myself ran into the same situation. Thus, he who holds the budget must also think about the right balance between seniors and juniors.

Bosses can create a culture that encourages better decision-making by sharing goals and plugging holes. Happy leading.

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¹ Usually, for-profit organizations end up having a collective north star around increasing recurring revenue.

² Of course, inexperience can be attributed to all sorts of negative behaviors such as lack of intellectual sophistication, emotional resilience, and so forth.