Building A Business That’s Anti-Fragile
On my personal blog I wrote an article yesterday about how I’ve built an anti-fragile lifestyle, to offset the unpredictability that my health conditions impose. In this post I thought I would explore how I’ve applied the same principles in business to create an organisation that’s also resilient to the unforeseen. I have to admit though that my attempts have not always been successful in business, so this post reflects lessons learned through failure as much as it does success. So suitably cautioned here’s my guide to 10 steps to anti-fragility in business.
- Have Enough Slack, slack is critical to anti-fragility, by slack I mean having enough resources to respond to unforeseen events, to take advantage of new opportunities, to keep learning, to put in extra effort when needed, to have time to refine and improve. Many organisations today seek to eliminate slack, to constantly cut resources to the bone. But slack is like the oil in a ‘well oiled machine’ too much and energy is wasted making the machine inefficient, but too little and the machine seizes up. It’s easy to see an organisation with too little slack, people stop helping each other, projects stall because of dependencies, the business becomes too reliant on specific individuals (who are under unsustainable pressure), people start to burn out, tempers are frayed, too much time is spent in meetings trying to fight fires that just spring up somewhere else tomorrow.
- Partition some time to learning for next year, we all know about learning directed at the challenges we face today, we call it training. Learning what we need to know next year is harder, it requires lots of experiments, taking a broad but shallow look beyond the normal bounds of technology and business, extrapolating and exaggerating trends. You need to be prepared to get things wrong, to spend valuable time learning something that ends up being useless. But when done right, a little time partitioned to prepare for the future makes an organisation incredibly agile and able to respond to new opportunities instantly. I’d recommend that you encourage staff to explore areas they are passionate about in this way. How to find the time can be tricky, but some ideas might be when a person feels they are in a rut, when they’re stalled on a project, the last few hours on a Friday, a rainy Sunday afternoon, a late night project. Of course time partitioned for the future is ‘slack’ so if a crisis arises or an opportunity presents itself today some resource is available, but don’t over-use it for this purpose. This post describes how I’ve personally applied this idea.
- Define Scope In Business Terms, all to often organisations define themselves in terms of a product or technology, rather than the business problem they are trying to solve and I think this is a big mistake. New technologies and products come along all the time and disrupt incumbents, but if you’ve defined yourself and your relationships with customers in business terms they are less likely to be disrupted. Lets take for example a company that provides hosted Microsoft Exchange email, they can see themselves as a hosted email provider, ready to be disrupted in an instant by Office 365 or Gmail, or they can see themselves as a SAS application hosting business, or maybe as a company that provides communication and collaboration services to large enterprises. With this broader definition of the business they are in they can establish a business relationship with customers, a relationship focused on solving problems, creating opportunities, and thus opening up many new potential revenue streams to weather disruptions.
- Build High Performance Teams, specialists are important to most businesses, but multi-skilled people and high performance multi-skilled teams are critical. All too often teams are built for a specific project and then dismantled when the project finishes, but a team is hard to build and a high performance team is really hard. Once you have one you want to keep it and a good team will want to stay together. Often the team loves working together so much that they will find new business opportunities themselves, they will innovate like crazy to keep themselves intact. Treat a high performance team is like a start-up, invest in it, let it experiment and fail, allow it to pivot, but keep it together.
- Don’t Over-Manage, successful projects, those that really set the world alight often seem a little crazy at first, or they succeed because of some subtle idea, or attention to detail that’s hard to justify up front. if you over-manage a team, you will stifle innovation, if you tightly manage a budget you will stop the team experimenting or going deep into something they really believe in, to follow a gut instinct that’s hard to explain. So give teams a bit of slack, trust them, invest in them, support them, make sure they are pointed in the right direction and let them loose. Of course lots of conditions need to be right for this approach to work, great people, clear direction, robust ways to assess progress, good insights into the ‘health’ of the team ….
- Co-locate, a collocated team is incredibly anti-fragile, when the unexpected happens people who are physically together support each other, co-operate, innovate and motivate in a way that’s just not so much more difficult virtually.
- Multi-skill, a team with a wide range of skills can innovate themselves out of a problem in a way that’s just not possible for a homogeneous team of specialists. Put all of the Microsoft Exchange people together and problem solving will stall within hours, but put collaboration services people together with a few server, networks, storage and service management people, cross skills a few of them with creative and programming skills and you have a team that will weather any storm.
- Provide Slush Funds, keep them at every level though. Often the VP will have a slush fund, but most problems that need solving will be hidden away, never being surfaced to that level. Give smaller slush funds to projects and teams within projects, let them report when they tap into them of you want, but leave the choice to ‘tap’ up to them.
- Provide Great Tools and Labs, don’t skimp on facilities, if people are going to learn, experiment, respond to the unexpected they need the tools at their finger-tips to enable them to do it. They need books and development tools and lab environments with spare capacity that they can fund from their slush fund instantly, without too much constraint or oversight
- Play, individuals and teams need to play with what they develop, to play with new ideas, to try new products, to play with competing products. Great ideas are so much easier to turn into profit when the team plays with them, or uses them directly, in support of their daily lives, not as testers. This is often called eating your own dog-food, but this is too narrow a focus, using what you develop. I’m talking about playing with new ideas and products long before they become products.
These 10 ideas for anti-fragility could easily result in an organisation descending into agile chaos, so good management is key, the strategy of the business needs to be clear, the direction needs to be actionable, the teams need to be motivated, progress needs to be tracked. See this post for more on good management practices.
I’m writing this post in Caffe Nero, taking a break after a great walk along the sea-front and trek through the dunes. I’ve chosen a photo today of a Hadza hunter-gatherer, one of the few remaining tribes who live this way, at one with nature, able to respond flexibly to most changes in their food supply or environment. Tribes that work together to solve problems, share their food, share their child rearing responsibilities, care for those that are ill, move when food is scarce. This picture decorates my lock screen, it’s a great reminder of the life we lived as humans for 99% of our existence.