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  • Jon Smart

(1) Organising for Outcomes

Every organisation is perfectly optimised to get the results it gets’. Are you happy with the results your team, team of teams and organisation is getting? If you are, congratulations. Carry on as you are! When I ask this question in organisations I’ve yet to have anyone say “yes, everything is great, we don’t need to change a thing”!

We are living through a once in a lifetime, no, a once in 250 year pivot in ways of working.

Today, five technology-led revolutions later, in the context of change and knowledge work, most organisations are still applying ways of working from 1771, which evolved in the context of repetitive, knowable work, with manual, unskilled, illiterate labour. This does not optimise for outcomes in today’s context, in the Age of Digital, with work which is increasingly unique and unknowable, with an increasing pace of change.

Even organisations which have been through or are going through a ‘digital | agile | DevOps transformation’ are still applying, in part, of old ways of working, thinking and behaving, often with new labels on the same old behaviours. With a charitable intent, this is because change is hard, change is social, it takes time, resilience, incentive and psychological safety to unlearn old habits and beliefs. Change is not binary, there is no ‘done’, it’s a spectrum, which should have a balanced set of outcomes. Every organisation is unique and human systems entropy, that is the weeds grow back over time, requiring ongoing nurturing of the garden, in order to optimise for outcomes.

A question to ask yourself and colleagues is “What are we optimising for today, in how we do what we do (if anything, intentionally)?”

  • Passing the baton in role based silos (“done my bit, not my problem”)?

  • Stack ranked performance appraisals, by job grade, within a functional silo (leading to people at the same job grade competing against each other)?

  • Longer time to value and learning than you’d like, as work sits stacked up (and invisible) in hand-off queues between functional role based silos?

  • ‘The business’ and ‘IT’, with us & them language and an order-giver, order-taker relationship? Bonus points for ‘business relationship management’ and shadow-IT sitting in the middle, further separating the customer, ‘the business’ and technology.

  • A fixed output contract over collaboration, early and often learning and value?

  • Big Up Front Design, designing the perfect output, up front and taking 6 months to do it (forgetting about the desired outcomes, telling people exactly what to build rather than why they are building it)? For example, ‘is the bridge built yet’? With the word ‘requirements’ being used a lot.

  • Learning delayed to the ‘end’, with the least time to act on it, with delivery risk back loaded, leading to an expensive cost of failure?

  • The definition of success is hitting milestones in an output plan, put together at the point of having learnt the least, rather than what slices of learning and value we have realised in line with an outcome hypothesis, with the cheapest cost of failure (learning)?

  • People as cogs in a machine, called ‘resources’, following orders, not asked to use their own brain, with little to no view of end-to-end value, the strategic intent or the customer, in the context of unique knowledge work?

  • A high level of concurrent work in progress, such that it takes even longer to realise value & learning, with lots of context switching?

  • Too busy pulling the cart with square wheels to have a conversation about the round wheels? Little to no incentive, therefore low priority and no time to continuously improve how we do what we do? “Pull harder!”. Or “this cart is stuck, we must leave it and start pulling another cart quickly, while we wait for someone else to unstick the first one”. Do not confuse activity with output, or output with outcomes.

  • A culture of fear, where ‘bad news’ (learning) is buried with a sea of green status colour, until it’s too late and where it’s safer to do nothing, than to try something better and learn through intelligent failure?

I could go on. This is the norm for most medium to large organisations. These are characteristics of ways of working from past technology revolutions, which evolved in the context of repetitive, knowable, mass production with people as cogs in a machine. It is treating the unknowable as if it is knowable, which in the Age of Digital does not optimise for outcomes.

The next question to ask is “What do we want to optimise for?” Do you know what outcomes you want? Are they being measured? Is everyone incentivised to improve on these outcomes? Do people have access to the necessary data so that there is a feedback loop?

When I ask these questions, the answers are usually don’t know, no, no, no and no.

Or, maybe ‘faster and cheaper’, no, no, no and no.

The success pattern here is to Focus on the Outcomes. Work out what set of balanced outcomes you want to optimise for. Ensure that they are measurable, measured and made transparent for learning early & often. This is an outcome data feedback loop which enables agility.

A balanced set of outcomes that I have found to work best across contexts are:

Better (quality), Value (unique, measured via OKRs), Sooner (time to learning & value), Safer (compliance) and Happier (customers, colleagues, citizens and climate)! #BVSSH.

Today, organisations across industry sectors are fundamentally changing how they organise, operate and behave. Organisations are pivoting from functional role-based silos with work passing (from the 18th century), to multi-disciplinary teams of teams, aligned to the customer and to the flow of value, across ‘our business’ (rather than ‘the business’ and IT separately). Hand in hand with this, organisations are also increasingly taking an outcome-centric view, rather than an output-centric view.

The reason for this pivot is in order to optimise for the outcomes above (BVSSH). With a new means of production, with disruptive competitors and with changing customer expectations, we are transitioning from ways of working which evolved in the past four technology-led revolutions starting in 1771 (mostly repetitive, knowable work) to ways of working suited to the Age of Digital (increasingly unique, unknowable work).

The pivot in how people organise, includes words such as Value Stream, Squad, Pod, Tribe, Chapter, Mission, Fleet, Crew, Domain, Diamond, Circle being used. There is an emerging new normal, across organisations. And yet this way of working for people is not new. We have evolved in small multi-disciplinary teams and teams of teams for the past 2 million years!

This post and subsequent posts explore the topic of Organising for Outcomes in more detail.

Next post in the series:

Learning resources:

If you found this article useful, you might be interested in additional Sooner Safer Happier learning resources to enable you to lead with these behaviours:

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