12. The Most Important Stakeholder

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Ash Maurya on Rocketship.FM, Richard Cheng on the Drunken PM, Jeff Gothelf on Boss Level, the mutual learning model on Troubleshooting Agile, and Amy Edmondson on Lead From The Heart. I’d love for you to email me with any comments about the show or any suggestions for podcasts I might want to feature. Email podcast@thekguy.com. This episode covers the five podcast episodes I found most interesting and wanted to share links to during the two week period starting May 27, 2019. These podcast episodes may have been released much earlier, but this was the fortnight when I started sharing links to them to my social network followers. ASH MAURYA ON ROCKETSHIP.FM The Rocketship.FM podcast featured Ash Maurya with hosts Michael Sacca and Mike Belsito. They started by talking about the lean canvas. Ash described the lean canvas as a one-page business planning tool that acts as an alternative to spending time writing a large document and exists because, when we start a new business, we know very little about it. The lean canvas was derived from Alex Osterwalder’s business model canvas and optimized for early-stage entrepreneurs. Ash says the lean canvas addresses the innovator’s bias of spending too much time thinking and talking about the solution. It asks questions like: Who are your customers? Who might be the early adopters? Why would they use your solution? How will you get your solution in front of those customers? How will you defend against competition? Where does the money come from? What is the revenue stream? Ash then described writing a follow-up book to Running Lean called Scaling Lean because readers of the first book wanted a better way to satisfy stakeholders looking for financial forecasts. He sees Running Lean as a book for the entrepreneur-to-customer conversation and Scaling Lean as a book for the conversation between the entrepreneur and other stakeholders. The usual way of sizing a market is by estimating revenue from what percentage of a market one thinks one can take, which Ash calls working top-down. Instead, Scaling Lean works bottom-up by modeling the inputs to customer value (such as a pricing model and a lifetime value model) and using this customer value model to produce a revenue estimate. Scaling Lean encourages a staged launch for your business. He compares this with Tesla’s rollout of the Model 3 by testing the riskiest assumptions of the business model by producing the Roadster, Model S, and Model X first. They talked about Fermi estimation and how you can use it to invalidate a model in as little as five minutes. Regarding inputs to such estimates, he says pricing is the most critical, followed by potential lifetime of a customer. He then says you test your estimate against the minimum success criteria, that is, the minimum number (revenue, impact, etc.) for the years invested in the startup to not have been a waste of time. You use this to build your traction model and, with each milestone, you think in terms of achieving ten times what you achieved in the previous milestone. Returning to the Tesla example, the Model S was intended be sold at ten times the quantity of the Roadster and the Model 3 is intended to sell at ten times the quantity of the Model S. Regarding the order in which to address risk, he says to think of the game Jenga (where you try to find where the stack is strongest and move pieces from there) and do the opposite. You want to build the riskiest parts first. He also shared a metaphor for preferring a focus on the customer’s problem over a solution-focus. He describes a solution-focus as building a key and then looking for a door it will open. Problem-focus, by contrast, is like finding a door that needs to be opened and trying to build a key for it. Apple Podcasts link: https://podcasts.apple.com/ca/podcast/interview-ash-maurya-of-lean-canvas-on-scaling-lean/id808014240?i=1000437174185 Website link: https://omny.fm/shows/rocketship-fm/interview-ash-maurya-of-lean-canvas-on-scaling-l-1 RICHARD CHENG ON THE DRUNKEN PM The Drunken PM podcast featured Richard Cheng with host Dave Prior. They talked about product ownership anti-patterns such as a product owner treating the dev team like they’re her vendor or like they report to her. This puts you in a situation where the team is incentivized to keep the PO happy rather than tell her the unvarnished truth all the time. In these situations, the dev teams don’t tell the PO about problems right away and the later the PO finds out, the fewer options she has for addressing them. Instead, Richard says we need a safe environment where the dev team and PO can be open and candid with each other. They talked about whether or not building prototypes is agile and Dave admitted that he is not a big subscriber to Henrik Kniberg’s “skateboard - bicycle - motorcycle - car” model of incremental development and, if he knows he’s going to have a car in the end, he would prefer you build a steering wheel so he can give feedback on it. Richard pointed out that the danger of this line of thinking is that you get a tendency to build vertical layers instead of horizontal slices. Richard doesn’t want a technical person as his product owner since he believes that technical people favor these vertical layers. I take issue with the idea that a “technical person” is automatically assumed to have no “product thinking” skills. I think a better way to put it is to say he doesn’t want someone who lacks the training in lean startup and product management skills in the PO role, regardless of their technical skills. Other than that, I’m in total agreement with Richard here, especially regarding how the same line of thinking that leads to software being delivered in vertical layers also leads to vertically-layered organizational design. Apple Podcasts link: https://podcasts.apple.com/ca/podcast/the-perfect-product-owner-w-richard-cheng-cst/id1121124593?i=1000436943035 Website link: https://soundcloud.com/drunkenpmradio/richard-cheng-the-perfect-product-owner-april-2019 JEFF GOTHELF ON THE BOSS LEVEL PODCAST The Boss Level podcast featured Jeff Gothelf with host Sami Honkonen. They started with a discussion of humility and the idea of having strong opinions, weakly held. Jeff says we need to admit that the ideas we put forward, even our strategic vision, are just our best guesses. When a leader puts out such a vision, she needs to open up room for her team to discuss and push back on those ideas. Sami added that this change in thinking coincides with a change in terminology to be a better fit for a world of uncertainty where words like roadmap get replaced with words like assumption, belief, bet, and experiment. They then addressed the topic of collaboration. For Jeff, organizing for collaboration means organizing in cross-functional teams and he says that even digital native organizations often get this wrong. He also says that these teams need to be empowered to make their own sprint-level decisions as they are closest to the information and, if they get it wrong, they can correct it in the next sprint. Jeff thinks the motto of every organization today should be to say that they are, in Astro Teller’s words, “enthusiastic skeptics,” excited to figure out the next improvement to their product or service. Sami asked about how organizations can change so that they begin to value continuous learning. Jeff says that we’re fighting a hundred years of manufacturing mindset that says, “The more stuff we make, the more value we deliver to our customers.” In this mindset, people see customer site visits and having engineers talk to customers as somehow less productive. He says that companies resist changing this mindset for two reasons: 1) it feels like it takes authority away from leaders; and 2) incentive structures: we don’t pay people for discovery work or collaboration or agility; we pay them for heroism and for delivery. Jeff says that this is the reason organizations fail to become agile or digitally transform: they buy all the books and training, change language and team structures, build tribes, chapters, guilds, and squads, but they don’t change the performance management system. They still measure people on the old way of working. Apple Podcasts link: https://podcasts.apple.com/ca/podcast/jeff-gothelf-on-sense-and-respond/id1041885043?i=1000437033229 Website link: https://www.bosslevelpodcast.com/jeff-gothelf-on-sense-and-respond/ THE MUTUAL LEARNING MODEL ON TROUBLESHOOTING AGILE The Troubleshooting Agile podcast, with hosts Jeffrey Fredrick and Douglas Squirrel, featured a three-part series on the mutual learning model. The first two episodes covered the first three values of the mutual learning model: informed choice, transparency, and curiosity. The third episode covered accountability and compassion. It started with a definition of accountability from the article “Eight Behaviours for Smarter Teams” and Squirrel told a story about the origin of the word “accountability” from the time of Henry II. Jeffrey described how his relationship of accountability was transformed when he watched a talk by Kent Beck called, “Ease At Work.” Kent talked about accountability as a personal obligation to render an account of his own thoughts and feelings and how this changed Kent’s experience at work. Jeffrey sees this kind of accountability as being important for having a learning culture at work and supporting the previous two values of transparency and curiosity. Jeffrey talked about the connection between accountability and compassion, saying that when people are accountable to one another, it is a lot easier to be compassionate because you start to understand more of what went into their actions and the positions they’re arguing for. Jeffrey then pointed out a place where he finds a lack of compassion for the people in power. They also included a discussion of having compassion for yourself. Apple Podcasts link: https://podcasts.apple.com/ca/podcast/mutual-learning-model-accountability-and-compassion/id1327456890?i=1000437494515 Website link: https://soundcloud.com/troubleshootingagile/mutual-learning-model-accountability-and-compassion AMY EDMONDSON ON LEAD FROM THE HEART The Lead From The Heart podcast featured Amy Edmondson with host Mark Crowley. Amy defined a “psychologically safe workplace” as one in which people believe they can bring their full self to work, speak up, and have their ideas, questions, and concerns welcomed. She says workplaces with high psychological safety are uncommon and organizations often have pockets of both low and high psychological safety. They talked about Google’s use of Amy’s psychological safety research to figure out what makes for high team performance. Mark made a distinction between psychological safety and physical safety and Amy responded that the two kinds of safety actually have a strong relationship. She cited the airline industry discovering through the investigation of black boxes that the majority of crashes involved somebody recognizing a concern and not being heard. She then clarified a common misconception about psychological safety. She said that when she refers to a workplace as being psychologically safe, she doesn’t mean that those in such a workplace are free from criticism or pushback or always feel good about themselves. She actually means the opposite. Psychologically safe workplaces have a high degree of candor. She contrasted this with college campuses that hold “safe spaces” where you cannot say anything that may remotely hurt someone’s feelings. Mark asked why we hold back on candor. Amy says it is a combination of how we’re socialized and how our brains work. We are highly tuned in to other’s impressions of us, particularly in hierarchical contexts. She says that many managers don’t create the conditions for psychological safety because they tend to mimic the behavior of the managers they’ve had in the past and haven’t stopped to connect their own experience of when they’ve done their best work to their management or leadership style so that their employees can do their best work. She says this tendency is a reflex and the problem is that, every now and then, this reflex is given a faulty signal that it works. For example, managing through fear can work in the short term when the task is simple and prescribed, clearly measured, and done individually. But very little of our work today has those attributes: it is complex, collaborative, and requires ingenuity to do it well. Under those conditions, fear doesn’t work. They talked about what you would look for in a candidate for a management position to ensure you get someone who can create a psychologically safe environment. She says that you want to look for people with high emotional intelligence. They should care about other’s opinions and needs but have enough self-awareness to know that their own life doesn’t depend on approval from others. You’re looking instead for passion, curiosity, and drive. Mark brought up a Deloitte study that said that 70% of people choose not to speak up about a problem at work even when they believe that not addressing it will harm the company. Amy says this is not because people rationally weigh the odds but is an unconscious act of spontaneous sense-making and temporal discounting in which we overweight an immediate event and underweight future events. Managers can address this, she says, by being willing to name the challenges faced and by asking questions. Mark asked about what we can learn from the case studies she has written about: the Wells Fargo fraudulent accounts scandal and Volkswagen emissions scandal. Amy asks us to imagine that the goals that the Wells Fargo and Volkswagen executives set for their organizations were not understood to be ridiculous at the outset and may have been intended as stretch goals. She says that when you are eager to set stretch goals, you need to have open ears. Being able to sell eight financial services products per customer is a hypothesis. Being able to create a green diesel that passes emissions tests in the US is a hypothesis. There is nothing wrong with setting these as stretch goals as long as you also encourage the people selling and developing these products to report all of the data that is coming back from the field and you adjust the goals based on this data. Apple Podcasts link: https://podcasts.apple.com/ca/podcast/amy-edmondson-why-psychological-safety-breeds-exceptionally/id1365633369?i=1000431400656 Website link: https://www.blubrry.com/leadfromtheheartpodcast/42334779/amy-edmondson-why-psychological-safety-breeds-exceptionally-high-performing-teams/ FEEDBACK Ask questions, make comments, and let your voice be heard by emailing podcast@thekguy.com. Twitter: https://twitter.com/thekguy LinkedIn: https://www.linkedin.com/in/keithmmcdonald/ Facebook: https://www.facebook.com/thekguypage Instagram: https://www.instagram.com/the_k_guy/ YouTube: https://www.youtube.com/c/TheKGuy Website: https://www.thekguy.com/ Intro/outro music: "waste time" by Vincent Augustus