Day One Thinking
a manifesto for product teams
Jeff Bezos published his 2017 annual shareholders letter last week. As with years past, some points were repeated, such as using reversible decision making and customer obsession (which was a mainstay of how we approached building any new product at Amazon).
The central theme of this year was how to avoid sliding into organizational stasis and decline (Day 2 thinking) and instead adopting what he calls Day 1 thinking.
Day 2 is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death. And that is why it is always Day 1.
To be sure, this kind of decline would happen in extremely slow motion. An established company might harvest Day 2 for decades, but the final result would still come.
I’m interested in the question, how do you fend off Day 2? What are the techniques and tactics? How do you keep the vitality of Day 1, even inside a large organization?
This year, two key themes resonated with me as they relate to building products and high functioning teams. Both these themes are highly interdependent and are critical to fend off decline.
a) Resisting proxies:
Beware of confusing proxies for successful outcomes.
On Day 1, teams are laser focused on solving for the right outcomes for your customers. Over time, the process somehow becomes enshrined as the reason for success. We tend to lose sight of why we do things. This not only leads to having teams use process as a crutch for decision making but also as a reason to say no to things that scare them.
The process is not the thing. It’s always worth asking, do we own the process or does the process own us?
The second trap of Day 2 thinking is an over-reliance on surveys and A/B tests vs. developing a deep understanding of customers and their problems. It’s tempting to rely on shortcuts and/or over-optimize metrics instead of solving for a real customer need.
Bezos cautions leaders to avoid these traps by having the courage to examine processes when things go wrong and fix the ones that no longer work.
b) High velocity decision making:
most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow.
Day 1 Teams are characterized by high velocity and high quality decisions. Decisions get made quickly when organizations embrace shorter cycles of learning. This implies both an organizational comfort with failure and learning as well as humility in its leaders to recognize that most decisions are reversible.
First, never use a one-size-fits-all decision-making process. Many decisions are reversible, two-way doors. Those decisions can use a light-weight process. For those, so what if you’re wrong?
I’ve seen large and well resourced organizations fall into the “curse of perfection” trap. When there are more resources to throw at a problem, it’s easy to justify delaying decision making until they have 90% of the information they need. The outcome that is maximized is appeasing all stakeholders, so teams spend most of their energy navigating organizational/political minefields.
This implies that by the time Day 2 teams course correct after having built the wrong thing, they will have already spent months. During this time, nimbler competitors have learned more and out-innovated them. This is the true cost of deferred decision making.
Confidence and conviction is what separates Day 1 companies/teams from their Day 2 peers. Instead of abdicating decision making to a committee or choosing the most politically expedient route, Day 1 leaders ask their teams to “disagree and commit”. This simplifies decision making and creates momentum.
Third, use the phrase “disagree and commit.” This phrase will save a lot of time. If you have conviction on a particular direction even though there’s no consensus, it’s helpful to say, “Look, I know we disagree on this but will you gamble with me on it? Disagree and commit?” By the time you’re at this point, no one can know the answer for sure, and you’ll probably get a quick yes.
This isn’t one way. If you’re the boss, you should do this too.
Trust, respect and emotional maturity are required ingredients for highly functional Day 1 teams. Secondly, Day 1 teams need to be obsessed about finding the right outcomes for their customers. Third, Day 1 teams value momentum in all things, including their decision making.
In the absence of these conditions, it is hard for teams to express genuine disagreements of opinion without being political and to make the best decisions for customers without letting the loudest voice win.