SCALE, The Exponential Organization Part 1 — PM Mental Model #8
Over the last decade or so a new breed of company has risen, Uber, Amazon, Airbnb, and Stripe among others have shown exponential growth, over 10 times more than historically seen by successful companies. In one of my favorite books “Exponential Organizations EXO 2.0” by Salim Ismail, Peter H. Diamandis, and Michael Malone we look at a set of frameworks that have been born from the study of these companies. A big thank you to
The book defines 3 frameworks, the MTP (Massive Transformative Purpose) which is a similar concept to our “Start with Why” mental model, the Acronym IDEAS which is synonymous with the left side of the brain representing Order, Control and Stability, SCALE representing the right side of the brain and the traits of Creativity, Growth and Uncertainty.
Today we are going to look at the mental model SCALE and how Product Managers can utilize the learnings from the book for success.
S — Staff on Demand
Gone are the days when organizations relied solely on traditional employment models. Exponential organizations leverage the gig economy, outsourcing, and remote work to access a global talent pool. By tapping into specialized skills precisely when needed, these entities remain agile and adaptable in an ever-evolving landscape. With platforms like Upwork, Toptal, and Fiverr they assemble teams quickly, ensuring the right expertise is available for each project without the overhead of maintaining a large in-house workforce.
Example:
Uber relies on a network of independent drivers who can choose their hours and work on-demand. Through the Uber app, drivers can connect with passengers needing rides, providing flexibility for both parties.
C — Community and Crowd:
Successful products are built with the end user in mind, and who better to provide insights and feedback than the community itself? Product managers can leverage crowdsourcing platforms and social media channels to engage with customers, gather feedback and co-create value. By fostering a vibrant community around their product, they not only gain valuable insights but also cultivate brand loyalty and advocacy. Platforms like Kickstarter and Reddit offer avenues for product managers to tap into the collective intelligence of the crowd, driving innovation and market relevance.
Example:
Amazon utilizes customer reviews and ratings to foster a sense of community and trust among shoppers. Customers can contribute feedback, ratings, and recommendations helping others to make more informed purchasing decisions.
A — Algorithms
Data-driven decision-making lies at the heart of effective product management. By harnessing the power of algorithms, product managers can analyze vast amounts of data to uncover trends, identify user behaviors, and inform product development strategies. Whether its using machine learning algorithms to personalize user experiences or predictive analytics to forecast demand, algorithms empower product managers to make informed decisions quickly and accurately. By continuously refining algorithms based on real-time feedback, they can optimize their products for maximum impact.
Examples:
Netflix uses machine learning algorithms to personalize content recommendations for each user. These algorithms analyze viewing history, genre preferences, and similar user behaviors to surface content that is likely to resonate with individual viewers. Netflix, famously, also used Crowd & Community to enhance its algorithms via a Kaggle Competition worth 1 million dollars.
L — Leveraged Assets:
Product managers are often constrained by limited resources, whether its budget, time or manpower. By embracing the concept of leveraged assets, they can maximize efficiency and scale their efforts without overextending themselves. This involves leveraging existing infrastructure, partnerships, and resources to accelerate product development and market penetration. Whether its leveraging third party API’s, co-marketing agreements, or shared services, product managers can focus their efforts on innovation rather than reinventing the wheel.
Example:
Probably the most famous example is of course Airbnb, who enable hosts to monetize underutilized spare rooms or properties to travelers. Hosts can leverage their existing assets, such as homes or apartments, to generate additional income without significant upfront investment.
E — Engagement:
In a crowded marketplace, capturing and retaining user attention is paramount. Product managers must prioritize engagement at every touchpoint, from initial awareness to post-purchase support. By leveraging social media, gamification, and interactive experiences, they can create immersive experiences that resonate with users on an emotional level. Through continuous engagement, product managers can build strong relationships with their audience, driving brand loyalty and advocacy. By listening to user feedback and iterating based on their needs, they can ensure that their product remains relevant and valuable in the long run.
Example:
Stripe offers developer-friendly tools and documentation to streamline the payment integration process. By prioritizing ease of use and accessibility, stripe fosters engagement and adoption among developers, driving growth and usage of its platform.
Product managers are pivotal in building products that resonate with customers and drive business success. By understanding the SCALE framework that takes a modern look at how businesses are successful in this day and age, product managers can unlock new avenues for innovation and engagement, critical for product success. Leveraging staff on demand they can assemble agile teams with specialized skills to tackle diverse challenges. Engaging with communities and crowdsourcing feedback enables them to gain valuable insights and foster loyalty among users. Harnessing algorithms empower product managers to make data-driven decisions and deliver personalized experiences that captivate customers. By leveraging leveraged assets and focusing on engagement, product managers can create products that not only meet customer needs but also exceed expectations, driving growth and differentiation in the market. In a landscape defined by rapid change and evolving customer preferences, embracing the principles of SCALE equips product managers with a powerful framework to build better products that their customers engage with, driving long term success for their organizations.
Further Reading:
Exponential Organization 2.0 — Ismail, Salim; Diamandis, Peter H. ; Malone, Michael S
Other Blogs in this Series:
The Five Parts to Every Business — PM Mental Model #1
The Flywheel Effect — PM Mental Model #2
Artificial Intelligence Use Cases — PM Mental Model #3
Good Product Manager, Bad Product Manager — PM Mental Model #4
“Start with Why” -PM Mental Model #5
