The Simplifier

Great article from @dom (Dom Sagolla) on Twitters throes of reinvention when its predecessor company Odeo started running out of cash.

How Twitter Was Born
Jan 30, 2009 Dom Sagolla History
Twitter was born about three years ago, when @Jack, @Biz, @Noah, @Crystal, @Jeremy, @Adam, @TonyStubblebine, @Ev, me (@Dom), @Rabble, @RayReadyRay, @Florian, @TimRoberts, and @Blaine worked at a podcasting company called Odeo, Inc. in South Park, San Francisco. http://www.140characters.com/2009/01/30/how-twitter-was-born/

Carriage House Blog Uncategorized

Young technology firms enter a particularly delicate phase as they shift from focusing on engineering to sales. This developmental moment is sensitive for many reasons, but in our experience two factors stand out: 

1. Thin staffing and tight budgets dictate that anyone who can tell ‘the story’ — sales, business development, marketing, CEO, CTO — scatter to the points of the compass in search of risk-takers with budget. This means that executives rarely find themselves in the same place at the same time having the same experience. 

1. Aggressive early adopter customers reach deep into the engineering and support teams, becoming representative of ‘customers’ to these groups. These accounts know how to play the game, demanding bug fixes, enhancements, and priority shifts in their favor while their clout lasts. 

Inevitably, these different exposures — touching different parts of the elephant — spawn a range of beliefs about which markets to pursue and where to take the product. The challenge:  Building a coherent picture out of diverse experience fragments. Will the real market please stand up? 

Our View: Wallowing, at least briefly, in impressionistic feedback is fine. But real value — insights plus consensus — comes from transforming impressions into structured findings. 

How? Assemble a panel of smart, committed people from across the spectrum. Start with the premise that each of their reality slices fits into a framework, even if it’s unclear how or even into what framework. 

Instead of taking statements like, ‘Our prices are too high’ at face value, tug on that string and see what’s connected. Who said what, exactly? To whom? What was the stated reason for not buying? Encourage contributions but insist on details. Lay out what you think will be useful dimensions of analysis in advance to help your panel members structure their contributions. And be ready to abandon non-productive elements of your model and generate new ones that gracefully organize the facts you’re gathering. 

Behold. An elephant materializes. 

Carriage House Blog Strategy Alignment, Budgets, Clarity, framework, Interviews

Most organizations we’ve worked with suffer what we call a ‘strategy bulge.’  That is, not much talk about strategy at the top or bottom of the organization, but a swelling of discussion in the middle — a mostly unproductive bloat of concern, criticism, confusion.

Our View: The strategy bulge can be slimmed down with a steady diet of clarity — clarity about the strategy and how the strategy dovetails with tactics. The bad news: It’s likely not just a communications breakdown. 

Strategies, elusive and broad, spring from models. They draw strength from simplifying concepts, bold assumptions, intuitive leaps, and big ideas. Strategies give context and direction, and evoke challenging end-states. 

Tactics, tangible and specific, live in the concrete world of rebates, extended warranties, training programs, and service call metrics. Good tactics handshake with the protocols of human behavior, organizational processes, and money flows. People perform them. They’re measurable. 

The challenge: Connecting ethereal strategy to physical tactics.

The answer: Link strategy to tactics with a flexible layer of ‘execution-aware’ analysis. 

What is execution-aware analysis? It’s the product of hard work on the part of your senior operating people, teasing out the basic factors that distinguish your markets from each other. It results from working with those factors, drilling down to a detailed understanding of why and how your products and services are needed in which markets, by whom, and how best to get them there. 

It materializes as spreadsheets where broad concepts have been broken down into smaller pieces, interrogated, and then broken down again and interrogated further until the cells fill with detailed insights — insights capable of telling sales reps and business development managers where to focus. It incorporates hard data. 

And with that analysis you can get the kind of clarity that people in the middle of the organization crave. You can connect strategy and tactics with thoughtful analysis — and over time you can win the battle of the strategy bulge.

Carriage House Blog Strategy Alignment, Execution, Strategy Process

The strategy process wraps up. The final presentation ends with solid eye contact and nods around the table. A collective exhale of relief. Shift to execution.

Time passes. Results don’t neatly cluster around your formal strategy and teams drift toward different constructs to guide their decision-making. Pause action: You’re looking at what we call ‘strategy deflection’ — and it endangers execution. 

 Our View: Strategy deflection stems from the fallacy that strategy work ends when execution begins. We believe that alignment is key to great execution and alignment requires a common framework — one designed to gracefully handle hard reality checks. 

A good strategy makes hard choices among competing alternatives. It’s a snapshot — a best-synthesis of available facts and factors, simplified for modeling. How do you craft a strategy that outlives its static start and exerts an aligning force on raucous reality? 

First, focus on the assumptions. Every strategy rests on assumptions and theories, like: Demand is price-sensitive; sales cycles take 6 months; customer budgets are fixed; competitors will react to a price cut; clients will pay extra for premium service; qualified sales reps are easy to find — some so deeply held they’re considered fact.

 As the up-front strategy work winds down, isolate the key assumptions and concepts that underpin the chosen direction. Document the impact of each on the strategy, the way risks are documented in 10K filings. Next,  ‘instrument’ each one — identify concrete results that prove each element true or false, and specify how you’ll obtain the data. Monitor quarterly for early warning of a strategy/execution disconnect.

 Finally, when real customer and market behaviors mass differently than expected, proactively revise the strategic assumptions first, then draw different conclusions. Vision-driven strategies have their time and place, but don’t blindly stick with a static formal strategy while evidence mounts against it.  Instead, strive for a dynamic strategy process that breathes the same air as execution and squelch strategy deflection the right way — with a vibrant strategy based on live assumptions. 

Carriage House Blog Strategy Alignment, Execution, Strategy Process

Wouldn’t it be great if you could re-start a company by simply putting the key in the ignition and turning? Well, you can, metaphorically. But first you have to find that ‘key’ — and locate the ‘ignition.’ 

A recent project with an established services firm brought this to mind. The company had grown quickly, then stalled. The CEO, the investors, employees — all wanted growth. The marketing challenge was straightforward: Identify one or more big, fast-growing, relatively open markets, figure out what’s needed in them, and offer value. Not simple, but a manageable exercise. The harder question was organizational: How to reset the pernicious protectionism that had crept in during the no-growth years? 

Our View: To get the restart rolling — and reverse the defensive posture of employees — the key is ‘fact-based trust’ and the ignition is an aligned executive team. 

Fact-based trust doesn’t require months to build. It’s not warm and fuzzy and relies little on CEO charisma and personal relationship. It’s granted on merit, based on observed dedication to transparency — like building a market opportunity map with vetted data and explicit assumptions, instead of an outcome-rigged approach. Fact-based trust cultures objectivity within the project, feeds off the shared aspiration to grow, and builds a solid base for transcending parochialism when it comes time to organize and act. 

An aligned executive team agrees on which facts matter, when accurate data has been surfaced, and what those facts mean to the firm. Those elements — the framework, the facts, and their meaning — are hard won. Merely exposing a team to data doesn’t cut it. They’re aligned when they’ve internalized a common interpretation. 

How do you get started? Set a timetable, a sequence of events, and an ambitious objective — and then solicit and incorporate input on those elements and on just about everything else. 

Begin with an analysis of the customer base — a snapshot of your market position. Establish reliable basics — customer counts by industry, geography, size, or other segmentation criteria. Where are the gains and losses? What do they buy? How much do they pay? Experiment with ratios like revenue per customer and establish trends. Dedicate the time to discuss the data, and be open not just to interpretation but to assembling different data in order to establish trust. Iterate. 

Hold fast to one objective: We will find growth opportunities. Insert key (fact-based trust) in ignition (executive team). Hear that growth engine purr.

Carriage House Blog Strategy Data, Fact-based Trust, Growth, Market Opportunity

Every company we’ve worked with wishes its employees were wired together into a single consciousness dedicated to flawless execution. 

Reality check: That would be one noisy space, a virtual cacophony. 

The truth is, even many good soldiers are quietly unsure about ‘the plan.’ Some think pushing into a particular market will be a land war. Others believe a subscription pricing model would work better than licensing. Another camp feels the current product positioning pits them against entrenched competition. Yet another faction sees a hungry market for a repackaged offering. And that’s just within the executive team. 

Most of this lurking insubordination is not idle complaining — it’s thoughtful conclusion based on actual experience with prospects, customers, and competitors. We call it data. 

Our View: On any given day vital data — what your people know — is hiding in plain view. 

When you make the numbers, nobody asks or tells. But when you fall short and start playing twenty questions, you quickly find out that your market-facing people saw the problem two quarters ago. Why didn’t they speak up? They probably did. But under the pressures of operating the business, executives often ignore inside data sources, particularly when they come in the form of random tidbits in the elevator or at the gym. 

What to do? When you’re executing a shift in direction, looking to expand into new markets, rethinking your value proposition, or questioning your positioning, look inside first. Structured, qualitative interviews with your frontline people — sales and service — will unearth valuable tactical and strategic insights, in companies small and large. 

And once you know what you know, you’ll know what you don’t know.

Carriage House Blog Strategy Consensus, Interviews, sparse data

One company we worked with faced a common challenge. The product — an advanced technology targeting a future need in a nascent market — neared completion. A dozen deals in process but none closed. No money yet changing hands. Investors itching for results. 

This is a typical but painful reality for startups in emerging markets. As big decisions loom and the intensity of debate grows, the question often becomes: Where’s the data? 

Our View: Even sparse data can be mined for strategic guidance in early markets. 

When there’s no transaction data to support the business plan, don’t despair. Even in early markets important qualitative data can be unearthed from inside your company and externally from the target market. 

From outside you can source data on buyer pain, motivation, fear, and need. If it’s well-targeted and objective, even small-sample structured primary research can peel the onion and provide helpful input to product, value proposition, and positioning. 

From inside, your best data will come from business development, sales, support, even engineering. These folks know the customers and prospects on a ‘transactional level’ but you can coax a wealth of soft information from them beyond what ends up in pipeline reviews, event logs, and bug reports. 

Think like a TV lawyer: You only get answers to the questions you ask. Get the hands-on people in a room and inquire from different angles. Build a solid foundation of what they know first-hand from customers and prospects before asking them to speculate or extrapolate. Create a structured framework that captures first-hand knowledge, customer by customer, so the results can be standardized, tabulated, and compared. 

Who says there’s no data? There’s lots of data. 

Carriage House Blog Strategy framework, sparse data, Startups