Thursday, January 3, 2013

Everything You Know About Startups is Wrong

Every generation finds its own management style. The "Bell Curve" style of management, popular in the 80's and 90's, is now eating holes in many corporations and is being viewed through a much darker lens (see Vanity Fair's excellent piece Microsoft's Lost Decade). While the management concepts may differ, the way to market the New York Times' bestselling management books is the same: "Everything you know about ____ is wrong" (the title is meant to be tongue in cheek).

For our generation, this shift has certainly been towards the "Lean Startup" mentality. We've learned from Steve Blank that a startup is a fundamentally different creature than a developed business. By using analytics, we're effectively introducing the scientific method into our management decisions. We're keeping costs lower and minds open. All good things.

However, I'd like to suggest that we've gorged ourselves and taken this too far. There's a wonderful little clip on YouTube showcasing Steve Jobs' early days at NeXT. While Jobs reaffirms "all that matters is the ship date", he also highlights something that today has become somewhat villainized: the vision. So says Jobs:

There needs to be somewho who is sort of the keeper and reiterator of the vision, because there's just a ton of work to do. And a lot of times when you have to walk a thousand miles and you take the first step it looks like a long ways. And it really helps if there's someone there saying "Well we're one step closer, the goal definitely exists, it's not just a mirage out there". The vision needs to be reiterated...I do that a lot.

Herein lies a problem with taking The Lean Startup too far: it can sacrifice the vision. There will come a time when your coworkers and employees are tired, burnt out, and unmotivated. And chances are, "let's launch another experiment" isn't going to be a sufficient pep talk. People need to feel that they are part of something larger, and it's this something that can often carry them through the difficult times.

It's important to acknowledge what The Lean Startup is when taken to an extreme: the greedy algorithm of business strategy. This is a wonderful thing! It's extraordinarily well-suited to a wide variety of problems. It's advantageous in markets where feedback is readily available. However, in the world of algorithms we still need divide-and-conquer paradigms, and dynamic programming as well. We similarly need different approaches for combating heavily saturated markets, markets where feedback isn't readily available, and markets where your competitors can significantly outresource you.

The Lean Startup has sparked something of a revolution – and appropriately so. However, it should be treated as a process, not a paradigm. Making decisions based on data is a good thing. Admitting when you're wrong is a good thing. Failing to provide your employees with a clear vision is not. And sometimes we encounter problems where a greedy algorithm just won't cut it.