Monday, June 16, 2008

Why is Maintaining Focus So Hard?

Saw this quote over at VentureHacks
“The main thing is to keep the main thing the main thing.” – Jim Barksdale
This is so true! In the startup world, a lack of focus can kill a company without the management team ever realizing they are dying (like the oft-mentioned Boiling Frog metaphor). In some ways its odd because with the limited resources at the hands of a startup, one would think that startups would be preternaturally disposed to constantly think about trade-offs and focus. However, there are a couple of factors that influence why start-ups might actually be more susceptible to self-destructive lack of focus:

1. Most Startups are About Big Vision

VentureHacks talks a bit about the "high-concept pitch'" in order to get folks to summarize a company's vision succinctly. The reason for this, of course, is that a startup needs to entice and excite potential investors, employees, and partners and the way to do that is to sell them on the vision first (which means they need to understand the vision - hence the high-concept pitch). This is neither good nor bad - its just a reality of raising money.

Sometimes though, a Vision can be so large that the necessary sequencing to obtain the fix becomes very cloudy for the startup. In order to hedge their bets, the startup invests in several different initiatives to test traction. As long as the tests are spectacular failures or spectacular successes there isn't a problem in focus. The problem arises when you test several tactical approaches and the results are all...okay. Its very hard for a management team to cut projects that are delivering decent results and might have the hidden potential to be the "next big thing". Instead, the company continues investing in all the "successful" experiments hoping for the big proof point that will make their decision easy for them.

2. Customers are Demanding!

Clayton Christensen covered the risks of being too focused on your best customers in Innovator's Dilemma. While his examples typically covered larger organizations, I think its something that startups need to think about as well, especially if a company gets early traction with a few large customers early in the game (if you are a consumer site the demands are a little less deafening). Building features for your costumers is a good thing, but its important to realize that many times those features comes with an opportunity cost of other features, core infrastructure or platform development that may actually be more important.

3. Sometimes The Main Thing isn't The Main Thing

Flickr's evolution from a game to a photo-sharing site has been well-documented. Caterina and Stewart deserve a lot of credit for being able to recognize when their "Main Thing" was no longer their Main Thing. This is a very, very hard thing to do and requires a certain level of self-awareness that just isn't that common. There are two traps startups that I think folks can fall into: 1) sticking to the Main Thing despite evidence to the contrary (or interpreting all evidence to be positive), or 2) thinking that everything is potentially the next Main Thing (not willing to write-off experiments).
In practice, its easy to see how these three factors can play a role in a company spreading resources too thinly over too long a period of time. Here's a couple of things I think can be done to offset these factors:

1. Stay Objective and Metrics-Focused
2. Implement a clean, transparent Product Development Cycle

I don't think there is necessarily one perfect product development process but I do think good product development cycles have a few things in common. First, there is an overall objective to maximize against with metrics that make sense. Second, there is a prioritized product backlog or feature list that is being updated often to reflect the most recent thoughts on ideal product evolution. Three, schedules and tasks are open to scrutiny so that slips are visible earlier rather than later. In general, a good Product Development Cycle makes the opportunity cost of product decisions as transparent and as calculable as possible.

It's important to break the metrics and objectives into bite-sized chunks though. This is one reason I really like the Scrum process in two-weeks cycles for most projects. A two-week sprint forces developers to be very crisp in terms of commitments while providing the business with opportunities to measure progress against objectives and metrics in a short-enough timeframe that decisions can be made quickly.

3. Be Brutally Honest When Making Tradeoffs...and Make Them!

No decision is ever a slam dunk in the startup world. Every idea and every product innovation has the opportunity to make a difference. A management team's job is to make tradeoffs between things which are by definition unknown. The best thing they can do is recognize where data is imperfect, recognize the risks, and make a decision. The penalty of not making a tradeoff decision often outweighs the impact of a wrong decision. (Another benefit of a transparent Product Development Cycle with clear metrics is that it makes it easier to fail fast and lessen the cost of bad decisions)


Josh said...

Barry, much of what you're talking about is just general management principles, not only limited to applications in the start-up world; I deal with these day in and day out in my corporate management life and in educational administration--data-driven, iterative management is how things get done :)