On Leadership: Crappy Execution is a Waste Startup Leaders Cannot Afford

Execution makes all the difference for practically every startup. It’s a core risk venture capitalists evaluate.

Forces arrayed against startup leaders are well-known and myriad: capital constraints, lack of brand awareness, lack of distribution, unequal access to labor, and, until the growth stage, foggy notions at best about product-market fit. Why add an inefficient and chaotic execution engine that, at best, could be described as a cacophony of effort and at worst flat-out disorganization.

When it comes to week-to-week, month-to-month execution, most startups, especially first-time startups, “just wing it”. They operate by feel and without a whole ton of communication about what they’re doing and why. The “what” comes out in dribs and drabs, streaming out of a leader’s head without connecting the dots, but conveying urgency and importance. Often, such startups find themselves overwhelmed with work because it just keeps piling on without any rhyme or reason. As a company scales, more and more people get frustrated because they lack context or they lack information about priority, sometimes both.

This common cacophony of effort often causes teams to focus more on the urgent and less on the important, more people duplicating effort because of the lack of clarity of roles and responsibilities, more effort being expended on less important activities, and minimal effort placed into constant improvement. In short, more people doing ineffective, unimportant, duplicative work.

Or, said differently, waste.

In this mode, typically a raft of questions emerges from those who are performing the work:

• Why are we doing what we’re doing?
• What is the “larger picture” (the vision? the mission?)
• What are we really trying to accomplish?
• What’s the highest priority accomplishment? (What can we de-prioritize?)
• What is a successful outcome? What’s an amazing/”wow!” outcome?
• How will we know we’ve achieved that outcome? (What will it mean if we don’t achieve it?)
• Who is making decisions about each priority or outcome?
• Who is responsible for driving the outcome? Who is required to participate? Do they have other higher-priority responsibilities?
• What is needed to achieve the priority or outcome? Do we have the required elements? Or do they need to be procured and/or redirected from a different priority or outcome?
• And on and on…

These questions always get answered because we, as human beings doing work, want those questions answered. Often they get answered verbally and in a game-of-telephone fashion, being passed on by a person who spoke to the leader and then speaks to other team members. Sometimes they get written down and shared in a piecemeal fashion as the question(s) emerge — often in Slack or some other messaging system.

Experienced and foresighted startup leaders recognize that these questions are always present and choose to write them down in an organized fashion. To keep a corporate record. Why? For:

• Clarity of purpose
• Clarity of outcome
• Clarity of priority
• Focus
• Knowing where we are against an outcome
• Decision-making (higher priorities come first)
• Stress relief

And, they know that there is some effort that comes with the practice of writing this information down in a structured fashion. Ultimately, though, recognizing that the rewards listed in the bullets immediately above far outweigh the effort of the written record.

Common Execution Systems

Mark Benioff (CEO, Salesforce) created V2MoM, when it was a 4-person company and John Doerr (Intel/Google-Advisor) helped Sergey & Larry adopt OKRs in the very first year of operation). Mark and John were both experienced startup leaders who created written systems to create answers to the myriad questions team members have and achieve the benefits listed above. Most notably, they started at the beginning and, unquestionably, achieved insane levels of success.

V2MoM stands for “Vision, Values, Methods, Obstacles, and Measures”. You can read a lot about V2MoM on the web and many companies large and small have adopted them as a standard practice. As it implies, Vision starts with a very long-term perspective for the company — the ultimate objective being pursued. Values are the core company values used in the pursuit of that vision. Methods are the primary outcomes which, if achieved collectively, “assure” (as much as any future-state can be assured) that vision. Obstacles are the key barriers to overcome in the pursuit of those Methods and that Vision. And, finally, Measures are the indicator of “how we’ll know we’ve arrived” at our primary outcomes (Methods). While Vision & Values are difficult to “cascade” down into an organization, Methods, Obstacles & Measures can be (note that many organizations of size do ask their middle managers to create functional Visions). Each “higher in scope Measure” can become a lower-scoped group’s outcome (Method) and, from there, a set of Obstacles and Measures for that narrower-in-scope outcome. V2MoM doesn’t really have the concept of a shorter-duration, smaller-scope effort that one might call a Project, Project, Task, Work Item or other “unit of work”.

OKR stands for Objectives and Key Results. These, too, you can read a tremendous amount about on the web as they are used very heavily inside Google. This Perdoo article is an excellent summary, especially from a practical perspective. Objectives are the outcomes that an organization seeks to achieve (virtually identical to V2MoM’s Methods) and Key Results are the measures of how one knows the Objective has been achieved (virtually identical to V2MoM’s Measures). In the same way that Methods & Measures can be cascaded downward into an organization and narrower in scope, so too are Objectives & Key Results. OKRs explicitly incorporate the concept of a Project (or Project, Task, Work Item, or any other word that connotes a fairly bounded piece of execution), as you can see in the Perdoo article.

V2MoM is a fantastic annual planning tool because its horizon is quite long and its structure concise for that annual period. It’s also a great communication vehicle to Boards of Directors and organizations because it’s concise and relatively long term. It is harder, though, to use it as a week-to-week, month-to-month system without going a layer-deeper into the execution with Projects. OKRs are a bit easier to use from a week-to-week, month-to-month perspective.

At Fermyon we’ve combined the best of both, since they overlap in clear way and provide for content that is useful and usable at the Board of Directors level all the way to an individual contributor level.

Because organizations need common language and common words to clarify meaning and simplify communication, at Fermyon, we’ve centralized on:

• Objectives: the core outcome(s) desired
• Measures: the core mechanism by which we’ll differentiate an awesome from poor outcomes
• Projects: the week-to-week work-horse of execution

The Execution Process at Fermyon

At Fermyon, like Salesforce and Google, we have an explicit execution system. Execution planning is done by first looking at what we want to have at the end of a given time period. What do we want to have at the end, what do we have to do to get there and how do we want to be on the way? Execution planning is also done by human beings who have to negotiate strategy, priorities, resources and, ultimately, make commitments to achieve results.

Fermyon covers this human practice of commitment by asking the five core questions that need to be answered for any commitment to be authentic:

• What is being asked and am I clear on that what?
• How is it to be done and am I clear on how I’ll achieve the results?
• Why is this being asked and how does it fit into the whole picture?
• Priority-fit: where does this effort or result fit priority-wise into the whole picture?
• Fear: am I fearful about any aspect of what I’m being asked to commit to? Am I procrastinating (which may uncover unanswered questions from the four above)

The execution planning process, then, in a nutshell:

1. Determine how far out are we planning. The further out, the less specific the plan should be. Too much specificity for long-term plans is usually a waste of time. Plans always change with changing environments, unknowns that become known, better ideas emerge, etc. (Engineers learned this long ago, which is why Agile (and derivative) processes were invented.)
2. Once we define the timeframe, we begin setting objectives. What we want. In the Five Reasons Why, it is “what” we want to accomplish. What do we want to have at the end of that timeframe? We must also consider the vision/mission to ensure that our objective has a clear “why” we are going to do it. The third question in the 5 Whys. Why or what is the purpose of this objective?
3. Then we figure out how to measure success and progress. An objective with no clear result statement is useless. And not knowing where we are against the objective at any given time is also a recipe for tangents, and in many cases, not course correcting fast enough.
4. Once we have an objective and a way to measure it we begin breaking it down into smaller pieces — projects. The smaller the piece the easier to accomplish. And we can delegate pieces of the objective to others on our teams. We can identify what collaboration is needed and what our work is dependent on that either others are working on or we must complete first. Now we are getting into the “how” we are going to accomplish it, which answers the second question of the 5 Whys.
5. Finally, we must look at obstacles, potential problems, delays, influences, our own limiting beliefs, our way of being, fears, etc. What will get in the way of completion? Other competing priorities for our time or others on our team? The fourth question in the 5 Whys, what is the priority? And, the last question in the 5 Whys, addressing the fear or contraction that might be associated with a commitment.

Measures & Projects: The Meat of an Execution System

What is a Measure?

A Measure is our way of understanding how we’ll know that we’ve achieved an important outcome. In theory, the sum-total of all Measures should be the “necessary and sufficient” work to achieve an Objective. And, in fact, is a good way to brainstorm all the Measures required for success.

Many are familiar with the concept of SMART when it comes to goal setting:

• Specific: a description such that most people understand specifically what the outcome is
• Measurable: an outcome that can be measured such that course corrections can be made
• Achievable: not too lofty but lofty enough to matter
• Relevant: highly connected to the vision and methods of the organization and of significant importance to warrant attention. High on Important; low on Urgent.
• Time-bound: constrained to a specific era of time rather than timeless or eternal)

Each Measure should conform to these SMART criteria.

When an execution system is working optimally, each Measure is also a result that an accountable person at Fermyon commits to. Committing to a Measure requires an understanding of what, when, how, priority, and obstacles by the person doing the committing.

For a Measure to have a high probability of being achieved, these five questions (what, when, how, priority and obstacles) should be crystal clear to both manager and accountable person. This requires work between manager and the person committing, to be sure. Why is this work warranted? Because not only do we increase the probability of a successful outcome but we also decrease the amount of stress and increase the amount of enjoyment for the accountable person. Rather than being asked to “just go take that hill” without knowing which hill, how to do it, with what resources, what level of urgency, and whether we have the ability to take that hill — having clarity on each of these questions gives us the relaxed confidence that we can take that hill. (See: “Empowerment isn’t just saying ‘Go Take That Hill!’”)

What’s our Frequency of Measure(ment)?

At Fermyon, we want to know every quarter how well we’re doing towards our most essential outcomes, so we measure results at the end of each quarter and we define the results we want for the next quarter. Where we have baseline information, we use it. Where we have historical growth rates, we use that. Where we have neither, we hypothesize both what would make us feel excellent (“what is a successful result?”) and what’s achievable.

Humans process information in “bite sizes”, so it’s relatively straightforward to plan for a year, then 4 quarters, then 3 months, and ultimately a week or two. Looking organization-wide on a quarterly basis and function-wide on a monthly/weekly basis made the most sense to us. At the organization-level wanted a cadence that felt long enough to get real results and not forcing ourselves into evaluation-mode all the time while being short enough to capture our attention and increase the odds that we can answer the Five Reasons Why within that timeframe (it’s hard to commit to something, especially at a startup that moves quickly, for a year from now).

Process

Before the next quarter begins, our CEO looks at both the Objectives and the current quarter’s Measures. He also looks at the key Obstacles to success. From that work he identifies the existing Measures that he wants to carry forward, Measures which he wants to drop and Measures he wants to add. Leaders on the leadership team conduct a parallel process in preparation for the “final plan” for the quarter. Some Measures may be a direct contributor to an Objective; some may be a direct response to an Obstacle. He then prioritizes them into one highest priority Measure; “a few” second-highest and a few more “important” — in other words, no more than 5–10 per quarter.

For each of these Measures, beyond the Priority, he will identify the person to whom he wants to delegate the result, the number that would be acceptable (“Target”) and for the high priorities only the number that would make him excited (“Stretch”).

After the CEO has completed the first-pass, each accountable person to whom he has delegated a Measure reviews it and decides if they can commit to that Measure as-is or whether it requires more work and/or negotiation with the CEO if the accountable person doesn’t believe the result is achievable. Each leader also reviews their own prepared Measures to compare points of view.

At this time, each leaders will answer two questions for themselves:

1. Is the one (or two) Measure that Butcher has identified for me the best Measure for our outcome? If not, a conversation ensues with the CEO to align on the best Measure.
2. Is there a second (or third) Measure I want to be accountable for? If so, what’s it’s Priority, Target, and, if a high priority, a Stretch.

What is a Project?

A Project is, essentially, a unit of work that contributes towards the Measure and Objective. Anything that is important enough and relevant enough to be a topic of discussion between a manager and an employee, which is important enough to relate to a Measure, which is a sizable enough “chunk of work”, is a good candidate for a Project that has a descriptive sentence. At Fermyon we currently constrain this explicit system to the Leadership Team — but any organization can cascade this as far down as they and their teams want.

In theory, the sum-total of all Projects should be the “necessary and sufficient” work to achieve a Measure. And, in fact, is a good way to brainstorm all the Projects required for success.

Frequency

Projects are defined whenever and wherever work is being planned — specifically at the beginning of a quarter in conjunction with defining the Measures, but also at any point during the quarter as relevant work is identified. Which could be as a result of a brainstorm in the shower. Or, could be a result of a conversation in a 1–1 between manager and employee.

At a minimum, though, each accountable owner of a Measure needs to ask themselves the above question (necessary and sufficient pieces of work).

Process

We take the time to write down:

• A sentence about the Project that is communicative to at least you and your manager
• The priority for this Project amongst all of your currently open Projects in the table
• The Target date for completion of the work
• The status of the Project — “To Do”, “In Progress” or some variant of “Done”

Retrospectives: Improving from Best Practices and Course Corrections

At the end of each period (we’ve chosen monthly), it’s vital to learn and adapt as an organization, which is where Retrospectives (See: Success or Success) comes into play. Retrospectives can help us identify Obstacles and work hard to eliminate them, while also identifying best practices that we want to continue to repeat because they work so well. Many are familiar with concepts like “Start, Stop, Continue” — this is a retrospecting concept that Starts (to improve something, solve a problem), Stops (things that don’t work or are ineffective) and Continues (best practices).

Systems

At Fermyon, we’ve built a specific AirTable base and incorporated tables to capture our strategic planning process called, aptly enough: Strategic Planning. Within this base are the tables & components we need to manage our execution — with one table each for vision, values, objectives, obstacles, measures, projects and retrospectives. Below are two (redacted) screenshots of an AirTable interface that presents the information for each accountable person in the system.

Interface showing the core Measures for the Accountable person (and where they are needed as a collaborator for others)

Projects and Retrospectives

Summary

Execution matters. It’s the difference between a harmonious orchestra of startup contributors who have excellent clarity of purpose, priority, effort, commitment levels, ownership and continuous improvement. It’s the maximum utilization of all of the talents and energy of every startup member — as opposed to some meaningful percentage of wasted effort and increased frustration.

The Measures and Projects portion of Fermyon’s execution system forms the essential basis of this harmonious orchestra. Measures are the core, prioritized, measurable results that drive towards successful outcomes and Projects are the real work associated with achieving those results. Fermyon operates on a quarterly rhythm for Measures, as they’re also the foundational translation between overarching strategy to week-to-week execution. And, an ad-hoc rhythm for Projects as the real work that needs to be completed is often not visible at the beginning of a quarter and/or is a course correction in action.

There’s a reason Salesforce and Google implemented explicit, extensive and written down execution systems — they wanted that harmonious orchestra and, ultimately, they wanted the same startup prize that all of us want: amazing success. Not all startups will have amazing success, but those with explicit execution systems are certainly more primed for success than those with wasteful chaos as their system.