Just when we think we have it figured out - the world shifts again.
Here's a way to stay on top of emerging opportunities and turn your scaling team into a learning machine.
Once start ups begin to grown up and transition to scale, it's natural to get caught up in operational goals, allowing little time or energy to focus on much else. In today's rapidly changing world and on-trend customers, this can be a mistake.
What matters for long-term sustainable growth is not just operational greatness (like smashing the quarter's critical numbers), but how your team manages knowledge and codifies learning in their DNA.
Unfortunately our outside world is not very forgiving for young firms. Macro level global markets go up and down on global threats and dubious news. Social and environmental problems continue to unfold at rates faster than we are able to solve for them. Customer trends and sentiment change weekly in response to rising influencers and tightening budgets. Competitors' seem to have no geographical boundaries. Technology continues advancing faster than we can render a royalty-free AI-image (see above built in 30 secs using craiyon.com!).
Management theory says the only sure fire way for organisations to face these uncertainties and changing times and still remain competitive for the long-haul is by building Dynamic Capabilities (Teece, Pisano and Shuen, 1997). The lead author, Teece is a New Zealand born organizational economist, top business intellectual and Professor. According to the theory, what matters is that organisations have the capability to learn quickly and build new strategic assets (or transform existing ones), to keep up with the pace of change. They do this through becoming rockstars at absorbing new knowledge and applying it to their circumstances and resources and actioning it. Thereby seizing opportunities.
What matters most is that organisations have the capability to learn quickly and build new strategic assets (or transform existing ones), to keep up with the pace of change.
As we scale, our focus narrows on operations. Really important! Particularly if you are scaling a digital business. We definitely need to focus in on our niche to scale. At the same time, we shouldn't become too complacent.
What is certain is change and uncertainty will rise again. So how can we sense and shape new opportunities in an uncertain world in a more certain way?
Step 1 Brainstorm your Known Unknowns
Below is a brainstorming exercise I run with leaderships teams of scale ups regularly to identify what is a "known unknown" and transform them into "known known" by setting learning goals.
It's good to do this as part of a regular strategic forum, such as an annual or quarterly review, but you can also do it regularly in your monthly team meetings. Start by asking everyone to write down things they don't know about the business or it's environment, or knowledge they have low confidence about. It could be something external to the business like new regulation changes, or what key customers are saying about us. Or it could be internal to the business, like how our new CRM investments have changed our customer support or acquisition unit costs.
Step 2 Discover your Unknown Unknowns - the religion of talking to customers and gathering data.
One way to identify your Unknown Unknowns is by getting really religious about customer feedback and competitor information. Set aside time or a regular segment in meetings and collaboration sessions to review these. Some companies go so far as to incentivise (carrot or stick) customer insights from frontliners like sales staff on a weekly basis alongside reporting. Others purposefully set out to create an "always on" culture (values, behaviours) of asking for customers and industry expert feedback and deliver these anytime via feedback channels into folks dedicated at reviewing and prioritising it.
For example one company set up a hotline for sales staff to simply text or call in nuggets of gold from remarks picked up duirng customer meetings that they may hear. AppleTree incorporated an easily accessible messaging screen from call centre staff to generate ideas off the back of comments from customers and send them to the brands they were answering support calls for. Capturing informal knowledge and customer feedback and turning it into opportunities.
Step 3 Set and prioritise Learning Goals
Once we have our Unknowns, we run an exercise to prioritise these and set learning goals on a quarterly basis. The focus of these learning goals is to run lean rapid experiments inside of the quarter to turn the unknown into a known or reduce the uncertainty.
Incorporating learning goals and learning experiments into for example, regular team planning sessions, is a useful exercise in training your people's learning agility muscle. An annual and quarterly team planning session should have both business goals and learning goals as output. A helpful way to prioritise your learning goals is to review what is currently unknown or uncertain, but potentially high impact if we get it wrong.
Having 2-3 learning goals per quarter alongside your operational goals helps your team take what is today unknown and make it more certain. So you can take action and seize opportunities.
For example, perhaps it could be how planned changes to Google's algorithms may or may not affect underlying assumptions about our acquisition costs and marketing spend in future, drastically impacting out financial projections. Or how shifts in consumer sentiment relating to our product may positively or negatively impact out future sales growth and current trajectory. Or perhaps it is new entrants with different business models and pricing structures we need more information about.
Step 4 Design a Learning Experiment
Finally, design an experiment around your learning goals using the methodology outlined by Eric Ries (Lean startup). Your experiment should have a learning objective and be based on a hypothesis. If it's quantitative if may look like this:
Example:
Known Unknown: What is our Top Jobs to be Done and resulting Brand Promises for our Best customers?
Learning Objective: To understand the top brand promises resonating most with my best customers.
Learning Hypothesis: I predict that customer response rates to Brand promise B will be significantly higher that Brand promise A.
If it's qualitative it may be about signals that your hypothesis is correct such as number of people providing more positive than negative feedback relating to a certain brand promise. Ideally the more you can measure your hypothesis the better.
For example:
Learning Hypothesis: "I predict Top Job B will (add, activate, increase) acquisition by (X%, X customers) over Top Job A.
Some Learning goals might be more knowledge based. For example;
Learning goal: How will new regulation effect my best customers' buying behaviour?
A learning goal like this will require in-depth discussions with your customers and an assessment of how their answers may or may not come to fruition.
Step 5 Implement the Learning Experiment
Write out the steps you need to take and the resources and people you may need including budget to deliver the learning experiment. You timeframe is up to you, as long as you can deliver the learning goals with the 12 weeks of the quarter. I try to design experiments no longer than 4 weeks. And sometimes it takes longer if I am relying on resources not within y control like contractors.Otherwise break down the experiment into the parts you can deliver this quarter and leave the rest for the next quarter.
Here is a practical, step-by-step guide and worksheets that are free to download. These help you to lead your team through regularly identifying your biggest Unknowns. Setting your Learning goals and designing your own Learning experiments. This exercise should help you to identify change and manage uncertainty so it doesn't always creep up and surprise you. , If run regularly, it may help you to structure and codifying dynamic capabilities like continuous learning, agile learning and sensing and shaping opportunities into your organisation.
I hope you find it useful as part of your next team planning or strategy meeting and look forward to hearing any suggestions for improvements!
Any questions or you'd like any facilitation, please reach out to me directly and I will be happy to respond. claire@made4scaleup.com
Comments