The one thing I absolutely love in the world of tech is finding people who are better at articulating the problems I’ve championed in words better than I can, and Marty just knocked it out of the park in his opening 10 mins of the first chapter in his new book — Empowered. It is great affirmation for me, and great to see this body of knowledge becoming mainstream — finally!
For a couple of decades now, since starting my software career in Finland at Nokia, in and around various product companies, I have been helping various organisations get better at building tech. Initially, it was techniques in writing better software, then it was applying better patterns and better tooling, then it was processes and tools. At some point, critically for me, it was all about culture and learning. This, to me at least, was inevitable as I moved up the organisation and closer to the root causes of the symptoms that I had to battle constantly at the coalface.
From working in startups to corporates, from government agencies to product companies, from New Zealand to Finland, from Argentina to India and to the USA, and in-between, working at the coalface with the real innovators. I’ve been fighting with innumerable organisations and their dysfunctions to fix their broken mindsets and processes when it comes to creating great software teams designing and building great software products. Believe me when I say, the patterns of dysfunction are the same everywhere in the world, no matter what industry or sector I was working in, or for.
It all came down to how the organisation viewed tech in their business, and thus how the organisation treated the people doing the tech.
Recently, I was asked by a respected contemporary of mine in NZ, “OK, well, if broken software organisations are so common here, then do great software companies really exist? where are they? and what makes them great to begin with?” (paraphrasing)
My heart and soul sank when I first heard this question. It confirmed for me that so many people I care deeply about, many of my kind of people who are highly intelligent and deeply skilled, are still working in such crappy and demoralizing software businesses dealing with the same predictable cultural and functional issues caused by their businesses. Perhaps they have concluded that: “It doesn’t actually get any better than this, so why bother trying to better myself!”
That just makes me want to fight harder for them, I think.
But then I remind myself, that this crusade is futile. The truth is, I’m over it, I’m burned out, I’m washed up, helping companies like this fix their systemic dysfunctions. The fantasy of being able to fix these dysfunctions and sustain that change long term, has faded for me. Across more than 15 years consulting in this domain, in this kind of transformation work, I’m done fighting this fight. Life is short. With the knowledge of how to create great companies and how to avoid the pitfalls, I just want to spend the rest of my time getting on and doing it with those who either know, or who can learn how to do it right— franky it’s hard enough succeeding in tech without this archaic baggage holding you back. These problems have been known and solved for decades folks! Park your ego, learn to collaborate, and get on being a learning organisation!
Every single time I get involved trying to fix or renovate a company (that does software) to help it grow or learn, it succeeds in some limited dimension for some time, for some people. However, eventually the cultural bubble is burst by the corporate immune system, and things simply revert back to the base culture that the company started with. Mission failed again. No matter what we prove in the process, no matter who we grow in the process, no matter what processes are significantly changed in that process, no matter that better outcomes are experienced. Someone, generally higher in the organisation, at some point, with far lesser knowledge, experience and wisdom, it seems, comes in and reverts all that transformation work back to what was once more comfortable to them. Admittedly, it is slightly more complicated than that, but it is the same outcome nonetheless.
Luckily, by the time it starts reverting, and the only saving grace for me to keep the tears at bay, is that all the people that had transformed and had grown on that journey have subsequently left that toxic place to better places. Begs the question: who’s then is left behind?
At the same time, I have proven through building my own software company from scratch, and through the many experimental and unique programs I’ve been involved with over the years, and with the experiences of some very successful and privileged people. That there are only 2 ways you can change the culture of any company building software to make better software, that actually work in this world and that sustain that change permanently. Everything else is ultimately in vain, just lipstick on a pig, and a scam.
I’m going those two approaches the Rewrite and the Purge.
The rewrite is simply creating a new software company from scratch. No existing culture, no existing baggage, only expectations of greatness — the green fields.
This approach only works if the architects of the new company know what great software companies look like in the first place, and what threatens their existence. Sadly, most founders have no clue about that, and the opportunity is lost forever to them. They need 2 or 3 more goes at it, to get anywhere close.
For those that have the experience and skills to do that, have to actively and intentionally create and shape a new product learning culture, and to protect it from everyone else trying to make it into something different — usually bringing whatever they learned from the last place they came from.
Now, it is entirely achievable if you say, only hire newbies into the industry and reset what they learned at school and university. But you have to be prepared to teach, and be good at it. Much harder to take battle-hardened corporate drones, who know no other way but the one that worked for them in the last place, and who feel like there is no other way than what they know. Bringing in life-long-learners (shall we say) is a far better proposition, as long as you can teach and lead them to lead others in the same ways. Either way, you need to invest in this pursuit intentionally and constantly. But it does pay off big time — as long as the company survives long enough in other areas to reap the benefits.
Essentially, this is a very high bar to start with and it requires hard dedicated work in addition to whatever else you need to do in your company. But it is totally unsustainable if you don’t recruit help from everyone in your organisation to sustain it long term. After all, the founding architects of the company don’t scale, and at some point need to focus on other areas of growing the business.
The purge is a technique that I learned from another contemporary of mine way too late in my career. They had the fortune to be involved with a company who was experienced in buying under performing software companies that had the potential to dominate a market but were held back by crappy leadership. Then rebuild them as top performers, and flip them.
They identified these software companies from the outside, then assessed their future potential and ̶w̶h̶a̶t̶/who was holding them back. 5-10X return was the benchmark. Then they bought a subset of these companies outright, and proceeded to purge their management. From the top down, they fired the entire board and senior leadership team, especially the project managers, with few exceptions, until they had culled right back to the actual productive people who contributed to or could contribute the real innovation to the business. Then they brought in top notch experts from their mother company to re-teach these people in better practices and processes, and establish a new culture and values around the product they were building. Then, once those people had learned the new skills and tools, they proceeded to hire the minimal necessary leadership teams that were required to sustain that level of productivity and that culture. Emphasis being no more than 3 layers of management above anyone in the organisation.
Then, when the market share of their product had increased to some target level, they would flip the company for 5–10X profit.
It is a brilliant stroke of genius in transformation. But it does require significant capital to invest initially, and top notch trainers to educate the teams. It takes a few years for each company, but it works beautifully.
In both these proven strategies you can see the common denominator that makes any other type of transformation effort completely irrelevant? right?
Treating Tech as a cost center
Today, every business that runs on software is trying to transform itself into a tech company. They don’t yet know that of course, they wouldn’t bring themselves to admit it either! They still think they are an insurance company, or a finance company, or a transport company, or a agriculture company, or a telecoms company. But in order to compete or even survive, they are going to have to be run like a software company before they are disrupted by native software companies who can learn to do all that stuff they do now, and innovate cheaper and easier ways to do the same thing.
It will take a little while of course, maybe time for a whole generation of business owners to be replaced by people who understand tech and software more than they did. But it will happen, and it is happening right now.
So, what do I think is the underlying reason these businesses are slow to transform?
It is that most businesses see Tech as a necessary cost to a business rather than the enabler of the business. Thinking that Tech is just another area of the business that serves the business, rather than the business itself. Good old-fashioned top-down command and control mentality from the early 1900's.
This reflects precisely the mindset of those who forged the Industrial Revolution. Where complex work itself was divided into simple jobs, strung together into some linear sequence to create something predictable and tangible of value. The people who came to do those jobs, the workers, required no intelligence to do the job — the complexity of the job and the risk was removed for them by the managers. Rows and rows of people doing manual jobs that together created something of value.
The clever people that ran the business, were the ones who broke down the complex tasks into simpler tasks and defined the sequencing of them. They created the processes. They were the management team. Everyone else was just a worker doing pre-defined work for the managers. Unskilled labor was easy to find, and products could be created at volume.
The stable businesses today that have integrated software into their businesses ignorantly continue to apply this kind of thinking to “those damn tech people that we pay so much money to. What are they thinking, what are they doing?”
Those clever managers who run the business haven't yet figured out how to break down complicated design and programming tasks into simple rote tasks that can be done by anyone yet. Believe me, they would if they could! They certainly keep trying to. But, in the meantime they have come to accept that those tasks are complex and require skilled labor — all those expensive designers and programmers. They haven't yet recognized that they are now in an adaptive creative business in the land of uncertainty, creating things that haven't been created before. This ugly truth is very inconvenient for them.
But, “damn it! we are not going to have a developer do testing, or god-forbid have developers understand what the business actually does” are we? They don’t speak our language, they don’t know our business. “That is our job!”. “Just get back into your tech unit and do what we tell you to do — you tool!”
Now, I am making this a little bit dramatic for you, but if you look closer at your tech enabled company, those cognitive biases are everywhere.
Don’t believe me? Answer this question for your business.
Where does the tech work in your organisation come from? Who demands it, and who defines it?
If the answer to that question in your organisation is something that sounds like: up the hierarchy and from some stakeholder. Or over from another person in another business unit. Or from your boss, or from some manager up the line from you. Then you, my friend, are still living in the industrial revolution age company that not only dehumanises those people creating the actual value for the company, but they are in charge of running a business ripe for disruption.
All you just have to wait around until they get too old and retire before that will change!