Systems of Success for Tech Company Growth: Part 1

"We don't do that here…..it doesn't fit with our culture", he said.

"We are following [insert the latest product development fad here] because [former leader, consultant, book seller] said we should do this", she said.

"We have a culture of collaboration and consensus", they said.

"The Digital Natives are not constrained by the [legacy, regulation, etc.] that we are", he said.

"We can figure that out when we need to", he said.

"All that process-stuff seems very corporate", she said.

"We make all of our decisions together", they said.

"We hire the best people, we really don't need the rules of all those old companies", they said.

"That is the way things are done here", she said.

"We tried that, it doesn't work here", they said.

The above are actual things I've heard in my work to help product development (and some IT) organizations big and small get better at what they do.

And in my mind I am thinking….

#FixedMindSet, #WeBelieveOurOwnPressReleases, #HubrisMode, #FailureMode, #GrowthAnti-Pattern, #ScaleAnti-Pattern  

Beginnings…..

After years of work and in an early attempt to describe the "operating system" of a high performing technology-driven company Sirish Ramachandra Davuluri , Cara Howieson , Thanos Malevitis and I described three inter-related "systems of success". To be clear, our target audience was larger companies trying to re-invent their technology organizations to be more adaptable, more innovative. We proposed that sustained performance required the organization to master the interplay between these "systems" AND continually refine their approach.

We also described what it would feel like to work in an organization that actually implemented these systems....

A few years later and after a substantial amount of additional work, Steve Roberts and I observed that many hyper-growth tech companies were taking on too much value debt in their operations. In many cases we observed that culture and a deep-seated aversion to "being corporate" were preventing leaders from seeing, measuring OR addressing growing value debt. And these were the companies that many others outside of tech were trying to pattern their technology transformations on. Inspired by Kent Beck's 3X framework, we compiled four zones of tech company growth or potential for "stalling out". We described a series of inflection points with key decisions these companies needed to make to continue to grow.

To navigate the inflection points, we prescribed what concreate steps hyper-growth companies could take:

1. Establish an ongoing debt reduction program (culture, value, tech); fund it; empower it; measure its success. (Debt is not a bad thing—unmanaged debt will kill your company. Manage it.)
2. Drive a cross-functional portfolio planning process that uses data-driven insights to define where a $1 is best spent to fuel their growth engines (foundational R&D, business R&D, go-to-market, customer incubation, etc.)
3. Segment organizations into different operating blueprints for incubation, growth/scale, sustain. Drive incubation/growth like a venture capitalist firm; scale and sustain like a private equity firm.

Fast Forward to Today.....

I believe that these earlier observations are still true, still relevant. But in the time since writing these pieces the pervasiveness of democratized technology (Cloud-Native tech stacks, AI, Peta-Scale data stores, Development Frameworks, LowCode/NoCode, Co-Pilots, etc.) has made it possible for any company to become a Next Gen Tech Company.

At the same time, there has been too much attention given to "quick fixes" (Lift and shift cloud migration, Agile-ish, DevOps-in-name-only, etc.) and not enough to foundational organizational and technical change.

Two critical things stand in the way of this ambition for many companies….. 

The first is a lack of attention to the design of "systems of success".  The second is what I call a refusal to acknowledge and manage to the "laws of physics" that govern the organizational organism's ability to ignite and sustain growth.

In this series, I intend to describe first the 15 laws of physics I've compiled over the past few years. I will then wrap up the series with a discussion on how some of the best "systems-based" companies run; what they do to sustain growth, how they think about managing the organizational organism.

To start, I leave you with this teaser……

"We’ve started to think about our business this way: The most important product we’re building is the Roblox operating system—our culture, our people, and the way we run the company—and we use that to build the Roblox platform." David Baszucki, CEO Roblox