Leadership as a service

“We were not in a grand way of business, but we had a good name, and worked for our profits, and did very well.” - from final chapters of “Great expectations” by C. Dickens.

This concept is far from being novel, yet it needs to be rediscovered by each professional in their own way.

This shows one journey of discovering and putting meaning to leadership as a service how it came and unfolded over the course of a couple decades.

Service primarily driven by going from empowering a team by being "the best" – which comes naturally; to driving the best out of your team by example – which is quite an artificial process.

The darkness

To appreciate light, we need to see darkness. The darkness here was and is Elite theory [1]. The “theory” de facto is a macro-sum (bias) of individuals striving to be the best and stopping there. Or bluntly single skill needed for leadership – operational (ephemeral) domination. This comes naturally, and often lives inside of a cultural layer.

The gap which this theory has is in declining. To illustrate this let’s dive into data on Olympic gold medals [2]. For 100 years of the competition there are just 318 incredible people in the whole world who won more than a single medal.

Such a career has a typically short time span of 4-12 years depending on the discipline. It took training of every muscle needed to be in perfect condition for each sport, and every hour of the day to get to that form, and then maintain it. And still, winning on the track of life is a short period in these cases. What lasted – is coming back to their communities, and giving heart back, showing example and path forward. That can and will last forever.

The ray of light

This was likely in a play, or movie. Happened instantly.

“Who cleans up your sh*t?” – the main character asks his partner. Pause. Surprised look. “Parents.” – scene.

This started the process.

Mr. J

Mr. J did come to the USA with a school diploma, no college profession, or bags of money. Mr. J came with determination and golden hands. He got his English courses, landed a job in maintenance (floor cleaning), and started building credit showing a strong habit of paying own bills on time.

When time came and credit score settled, he learned what’s what, and where is who, they (J and his partner) could take a business loan. The loan to buy a house, flip it, and sell renovated property ready for happy family.

The loan had two components: money needed to pay for the house itself as is, and money to renovate it. As the group knew how to do a bunch of work renovating the house, they needed to spend only a portion on contractors, and materials. That was their competitive advantage.

They did it with the first house, then with the second, and over time naturally ended up owning rental properties for themselves.

The end of the millennium was a perfect time for this too.

There are famous script and novel writers too who follow the quest of Mr. J: using every napkin, every short break while working in the service industry. S. Stallone describes the making of Rocky in 1977, which in spirit a way to describe typical software startup founder.

Meaningful work matters. It is effective.

NB: This story is about getting to your dream with given. Though, college education is still important for professions around CRISPR, quantum computers, legal, medical etc.

Wild exaggeration

Two thriller/drama movies as exaggerated models of group dynamics.

Exam (2009) – about importance of clear structured expectations, with a pinch of leadership as a service.

Experiment (2010) – this movie is the darkness contrasting leadership of a service to servicing the leadership. Exaggerated version of a manger who has no real explanation of own authority.

A typical idea in light is to make sure the manager is ready. Frankly one is ready when a professional can sense if the supporting environment is ready as well.

No further comments here to prevent spoiler alerts.

Business

Stories above were beacons. Showing what is missing.  Leadership as a service piece is well shaped by the following books, presentations and practices:

  1. "Eleven Rings: The Soul of Success", 2014 by  P. Jackson, H. Delehanty 
  2. G. Mogelashvili, 2018, Booking.com story about Team Autonomy at QConn
  3. K. Blanchard on servant leadership
  4. “Principles”, 2017 by R. Dalio on systematic company structuring and decision making
  5. “Radical Candor”, 2017 by K. Scott on practical notes on giving feedback
  6. “What You Do Is Who You Are”, 2019, by B. Horowitz
  7. "Trillion Dollar Coach", 2019, by  E. Schmidt, J. Rosenberg,  A. Eagle
  8. “The Infinite Game”, 2019, by S. Sinek
  9. Gary Vaynerchuk who verbally connects well on the topic in remarkably eloquent manner

It’s quite interesting to see how these works complement each other from different angles, sides and surfaces.

Sports

Following Mr. J example. In sports plan A is to be a good player, and then maybe train and coach as a plan B if injuries happen, or time comes.

It is important to mention Ted Lasso (2020) series too.

Line on a sand

Classical decision making describes three levels of maturity from simplest to complex and smartest: reflex, reaction, and response.

Maybe, leadership as a service is a complex response requiring training and preparation by a group itself, but yet it is smart and efficient way to organize game, and channel priorities in a smart way.

References

  1. https://en.wikipedia.org/wiki/Elite_theory
  2. https://en.wikipedia.org/wiki/List_of_multiple_Olympic_medalists


Decentralize


"Governing a big country is as delicate as frying a small fish... disturb a lot – and you get mush, leave untouched – charcoals” – Laozi (6th century BC)

Assigning proper people to manage a priority is also critical. After all, you don’t want to vote if surgery is needed, or not. You use a very limited group of professionals to advise on it – doctors.

Priority is sometimes confused with projects. Quality operations can allow many projects to be executed per person/team, but typically execution on each of them happens consequently on one-by-one basis.

Priorities are much trickier, no matter how perfect a product is there are parallel priorities as this product goes to operations. The main characteristic of priority in well oiled company is how quickly you handle a bottleneck when one arises.

Bottleneck could be a supply issue, customer question, making sure systems are up, whether it is payroll, project management, one of many API systems etc. When it happens, it means something went different on this day. Someone needs to assess, contain and adjust operations based on the assessment.

Each priority typically means some set of bottlenecks which your company experiences: or due to growth, or due to amortization. The theory of constraints clearly indicates that each bottleneck addressed opens another one somewhere down the stream.

That’s where decentralization comes into the game. When it comes to time and quality. If you have a “player” on your “business field” who knows what needs to be done to handle issues actively as they happen and further proactively - before they happen, your business saves time and constantly improves quality. In contrast, if everyone must go up to a single person who constantly tells how to handle this and that instead of figuring out (at least key) “bases”, there is obvious design flaw here – that person becomes a bottleneck. Independently handling issues and crisis creates better throughput especially when multiple priorities are triggered in the same time.

Ken Blanchard calls this training a team of eagles vs. team of (lame) ducks.

At some point, they need to start, or re-start again to get a better understanding of what the current process is. Decision making for important questions, including which questions are important, which questions need more discussions, and which discussions need decisions is a seniority characteristic. This characteristic is always relative, and always recursive, and always needs time and priority at every level.

Delegation of such priorities gives you confidence:
  • organization is setting up metrics and expectations for that operating block of a company
  • there is somebody else who asserts clarity on this part of a company process
  • with even 30-50% of decisions delegated to a team one creates healthy learning environment

To zoom out into a wider picture. Josiah Ober has a fantastic linguistic analysis in his paper [1] where he shows how meaning of democracy comes into capacity to do things, not simple voting tool when things are non-binary.

Especially true for specialized knowledge, whether it is surgery or refinement of an operating block. Think, about this… if you come to an office floor and there is person in a jacket with a sharp object stuck out of a pocket – you don’t need to wait for everyone to vote on it.

Teams are specialized to handle such “sharp objects” and need to have enough autonomy to act even before it is not clear how sharp they are for everyone else.

In the end of the day, that’s why we ask doctors for advice and diagnosis. That’s why you hire people who tell you what to do, no other way around. Then you work on keeping in synch. Then you apply “checks and balances” to what is expected from each function.

 

[1] - The Original Meaning of 'Democracy': Capacity to Do Things, Not Majority Rule


Signature of the artisan


 Craftsmanship means quality.

 A good example is “handcrafted signature” by Mercedes Benz AMG engine. To get the engine assembled they put together already prepared parts from commonly available materials. Then philosophy “One man. One Engine.” [1] precisely describes level of personal responsibility put into work to make sure supreme quality of the final product.

 Such a process gives clear ownership and reduces chances of miscommunication during assembly entirely. Software development processes are often compared to manufacturing [2], [3]. This is exactly the case: as software engineering means assembling already existing parts (code) into more complex engine or system.

The rest of the post takes the form of a quest. As it turns out the Internet tends to forget fine things. Because they should not be forgotten.

First, I am 90% sure Mercedes had a similar process for assembly of a model with artisan signature in the end. In that case car engine and parts would come as inputs, and engineer following strict process: scanning a next part into computer before using it to incorporate into the final product would execute quality-ensuring checklist. The automated checklist is a good example to make sure quality steadily remains and sometimes increases as there is a way to detect abnormal, or broken sequence. If you have a link to a video – post in the comments.

Lastly, below is a more emotional example from the realm of art. In this case simple signature done with a lipstick turns satellite dish into a lady.

As you would guess I could not find the original name and author of the painting. All AI tools did offer convincing description by prompt as well as dozens of possible pairs of names. Unfortunately, all turned out to be hallucinations. It was necessary to improvise. Results are below. If you know the answer and/or have a link to original art – post in the comments.

Satellite dish

With a minor signature turns out to be a lady

References

[1] - https://www.mercedes-amg.com/en/footer/about-us.html

[2] – “Lean Startup”, - Eric Ries

[3] – “The Phoenix Project”, - Gene Kim, Kevin Behr, George Spafford

"Triangle defense": customer, team, and long value

Incentives matter.

That’s what we can see in “The Big Short” by Michael Lewis depicting what misaligned incentives do to customers (loan takers), banks agents, money managers, insurance brokers, and retirement fund managers resulted in big recession and wipe out of savings at large.

Another case. A pharmaceutical company (let’s simply call them Y) abandons investment in R&D projects and focuses (entirely) on searching for acquisitions. It is hard to get ahead when you are always behind. Even as experiencing technology does not yield business, it does yield knowledge. Useful for deeper evaluation of a business category.

Understand me correctly, it’s not the strategy at the top line only: it’s gradual deformation of incentives which at the bottom line resulted in questionable practice.

In the long run, shares did drop. Shareholder value dropped. The newly appointed CEO would have to start conversation with government officials: “we are not the team which brought this ship to this wreck, we are the team which needs to manage this out”. Y even had to change their company name.

Let’s go to an even more morbid and fictional example of badly set business incentives. Of course it’s a reference to a story of Sweeney Todd. Business, shareholders, and a large part of customers (a business line) were happy. Except, they literally were cannibalizing fraction of customers, ignoring their interests altogether. This is a fictional story (or some say not) with deep metaphorical meaning.

Forth example. The famous The Johnson & Johnson Tylenol Case [1] gives a good example when thinking about customer mattered. They had a choice to fight massively expensive recall; yet recall resulting in a loss and share price drop in a short term and seal-closed bottles innovation meant in long term shareholder value gains.

Hence, the best framework for making decisions one could find is navigating best judgement using triangle of three interests: customer, team, and shareholder, - decision “triangle defense” of business. As each team follows virtues and takes care of customers, then the company follows and delivers value from their products, happy customers create happy feedback loops, and everyone benefits from long term value. That’s the defense.

 [1] - https://en.wikipedia.org/wiki/Chicago_Tylenol_murders

Technology and product balance


When it comes to execution it is important to remember technology projects usually do not match product features.

For example. Let’s say you want to create a rail connection between Chicago and New York, and New York with Philadelphia. Each connection is a separate project. That’s what business needs. Let’s call them Pj.

To build those roads you need to have technical means to accomplish them: asphalt factory, gravel, heavy equipment, and teams which put all these components together. Let’s call them Ti.

The way you build and ship software, integrate pre-built systems, verify, train operators, and secure your services – are like technical means in the example above. They define your “factory”. The goal of the technology strategy is to gradually restructure, expand and recognize these abilities to handle projects of corresponding business roadmap.

Classic trilogy “The Financier” by T. Dreiser depicts how mass transit system emerges from a need to connect a few blocks in different places of the city by two-three station segments. The system progresses, and interval operators form transit lines. The lines form colors (line groups) under common management. Then the city’s mass transit system emerges from all these three-station segments. Initial buildout of transportation intervals was independent. Lack of coordination creates the burden of managing different standards later when the merged system forms. It naturally takes time to transform merged system into one united one. For many modern cities centuries later, the issues are still there. Standardization often happens via issuing considerable municipal debt to manage transition: unifying width between tracks, height of platforms, shifting to the same cars to optimize maintenance, introduce team training etc.

Startups are similar, though like later stage mass transportation systems they can and should be guided by an accumulated knowledge. This allows for reduction of time during onboarding, operations, and duplicative R&D. Hence, directing time and resources from would happen technical debt to addressing unique challenges each startup has. Together with that, when time to market is decisive – technological debt is justifiable.

Constant collaboration of what’s behind product corner drives interest to enrichment of your technology toolbox, and as toolbox becomes richer – more challenging product items could be included to business roadmap.

Software development, EVs, Vulcans, Hedgehogs, and other inner animals


The better way to think about software engineering execution is to zoom out to a 10-mile-high view and discuss examples from physical engineering, as well as quickly visit our friends in marketing. First one will demonstrate limitations and gap bridging engineering has, and marketing gives us some insights on how to work with stakeholders.

Delivering smoothly, and in time are essential qualities of good execution. It is important to have a realistic understanding of where you are, and a clear view of where you need to be.

Understanding where you are is not only technological. It is about bridging market expectations. E. g. our understanding of transport is currently based on the fact we all used to carry all the fuel for the next phase of a trip with us. Whereas electric engines could allow for various scenarios due to more flexible availability of electricity.

Accumulation as we drive from solar panels. A practical real-life example which comes to mind is electric powered yachts. The design of their roofs was particularly accommodated for placing larger solar panels. These panels allow yachts to return to a harbor an hour after sunset with more than half the battery still full.

Pre-charging. Furthermore, liquid fuel created a habit of pouring needed energy into a car. This habit is so strong, that even other usual actions we make in different context do not help: replacing electric brush or toy car accumulators, and then charging used ones separately. Though, here price of car batteries and need to preserve lithium at least during this phase did move this “feature” out of original “MVP”.

The stations. The other side of the habit is the need for a specialized station where the fuel is stored. Electricity is universally available, and charging “outlet” doesn’t necessarily require storage capacity to be in a direct proximity. Hence, retail and coffee shops, malls, and other centers, and parking space overall are going to get boosts of their economical productivity due to these properties of the new tech.

Switching from examples of technology limitations per above to customer brings us to a marketing book “Why People (Don’t) Buy: The Go and Stop Signals” by professor  A. Chakravarti (LSE), professor M. Thomas (Cornell). The book gives interesting insights discussing three manager types with misleading biases: the Vulcan manager which considers their customers are perfect calculators, the Hedgehogian manager which considers one approach fits no matter what context is, and the anti-research manager, which is right depending on novelty of their context, like a Schrodinger’s cat. Various business cases in the book show the importance of action-to-market fit.

Despite different areas these examples are quite relevant for software development. Like in EV example understanding limitations of current paradigms, and flexibilities new ones bring does matter. To give a more specific illustration: containerization makes automation tools like Ansible, or Chef obsolete in their own context, modern web development allows separation of concerns (API and frontends), and cloud computing provides capabilities for resilience.

Learning your customer’s habits when such habits exist is an important step of execution here as well: not every system requires to be run 24/7; every table, row and cell may have own specifics which determine how databases are built and scaled; each startup may have own set of virtual facilities which determine services you will take as SaaS, acquire and host as a grey box, or leave it to be fully homegrown.

The old saying goes*: flight of an idea is typically interrupted by a compiler output. In other words, if an engineer has a chance for mistake, they will make it; if they don’t – they will make it surely.

Hence, it is wise to assume nothing without experimenting. This will allow you to connect two points – now and then – with one smooth and confident vector. Vector which bridges a world of machines and the world of people.

 

* - I think it’s from old C++ book but may be wrong.

Bonus Appendix. Some places where EVs charge.

Figure 1. Park ranger's charging station. Brooklyn, 2023

Figure 2. Slow charging station on a public parking lot. Rhinebeck, New York, 2023

Figure 3. Tesla superchargers site construction at furniture store's parking lot. Brooklyn, New York, 2023




“Non progredi est regredi”


My alma mater has Latin moto “non progredi est regredi” to keep students in constant motion.

Similarly, athletes apply the approach of interval training to their runs. They split each mile into small fast and slow intervals. Every fast run interval is alternated with a slow one, which allows to recharge and put high energy into a following fast interval. As training progresses the duration of an intense run increases, and slower ones become shorter. In a such way the trainee gets to a solid mile.

Japanese Kaizen philosophy directly formulates a need to focus on a 1% improvement goal with a steady sustainable pace. Once achieved, formulate the next 1%, and repeat the process.

Stay motivated as growth can happen even faster if one can find a way to increase the number of turnarounds each year.

Bottom line. Continuous improvement and smaller steps matter.

Strategy is all about starting and stopping in time

 

There are considerable number of ways how you describe a strategy, as well as even more ways to abuse this word in virtually every professional industry. What in a sense connects all the good ways to define a strategy is a simple criterion: when business needs to be started, and when it needs to be stopped. Then you manage overall company by following the market needs with long-, and short-lasting business lines. 

Let’s clarify. Team founding a company typically goes through evolution: from getting a minimal viability product, to a mature product, to a business, and after all to the company which manages what their customer needs rather what the business (line) was doing yesterday. It takes a lot of effort to get into a mature business state, hence typical companies, due to set incentives and corresponding communications, will naturally fight back any disrupting changes.

Historically good example here is Eastman Kodak (before 2012 bankruptcy). As mature company they held for film production and distribution business line so tight, that when digital camera was invented inside of Kodak, they failed to recognize it as a pivotal moment, and kept investing more money into chemical projects, where well established business lines were. Digital photos have brought much better moment capturing experience. They got disrupted by change, and deliberately missed timing to start the new business line which would define generations to come.

Understanding your customers, and what does not change over time is defining overall vision of a company. The timing of each business company runs defines strategy. Every other transition in-between is execution of such vision.

The more welcoming corporate incentives and processes are for changes in a market, the more a company can continue to innovate, and follow the evolving tastes of their customers.

More cycles you continue, better process you get



True artists are always growing, improving, and finding new techniques. Business is art. With each business cycle there are always opportunities to raise the bar. This could be more fine-grained sales, more reliable technology, actualized marketing, coordination within departments, or expansion of the production volume due to profits in the previous cycles.

Quite important to remember these improvements may be focused on two vectors: survivor or growth. 

Today’s environment of higher interest rates drives incentives from building a business of funding flows to a business which needs to demonstrate net positive cash flows. Hence, survivor mode during earlier uncertain days between A, B, and C rounds is directly linked to buying more cycles before the next one. This gives time needed to address vagueness of product market fit.

For more mature companies here comes Madam Frugality as at this stage small additional net negative expense per engineer may result in a behavior repeated day after day by hundreds, or even thousands of their colleagues. Stay thrifty my friend, and direct capital toward lighter and more growth-focused cycles. Afterall, if you are buying something you don’t need today, you will have to lose something you need later.

Virtual facilities define uniqueness of a business

 


 

Legend has it. Once upon a time there was an emperor. He was bored and looking for some entertainment. Many tried to amuse him, yet everyone failed to do so. One day a stranger comes with a square wooden box with 32 black and white pieces. That’s chess. The emperor is excited and after a few short hours of play he offers a stranger to pick reward his heart desires. The inventor’s ask looks modest: 1 seed of rice for the first square on the board, 2 for the second cell, 4 for the third one and so on for remaining ones.

“Easy!”, - says emperor and orders accountants to give what is asked. After some time, accountants come back and tell the ruler there is not enough rice in the whole kingdom to cover that board…

Compounding matters. In a sense, each business is like a chess grid: each cell is a (virtual) facility which helps deliver quality to customers. Even with 10 facilities like this: onboarding, processing, follow ups etc., - everyone who tries to reproduce such a grid and even gets to 90% accuracy still will achieve 35% (0.9^10 = 0.35) of anticipated quality.

Quality matters. Like business facilities, a technology stack of 10 subsystems which work 95% of time gives chance overall system works 59% (0.95^10 = 0.59), which is like flipping a coin.

Multiplication. Let’s say among 10 business facilities 6 require automation by software. Then with 10 technical layers each we get same 64 cell board, unique to your startup and markets. And when covering such a grid cell by cell with rice seeds of your labor may be too much for entire kingdom to cover.

Go places with each failure

 


The best of the athletes are embracing their failed pitches, throws and kicks. They take it as a foundation, and forge better themselves for the next round.

 There are five stepping stones in solving a creative problem*: 

  1. to want to solve the problem, 
  2. to believe a solution of the problem exists,
  3. to keep solving the problem at hand, 
  4. to understand what the obstacle is,
  5. to use that obstacle as a basis for discovering further path for the solution.

Whether you are leading blameless retrospective, or getting constructive feedback on a design, or fine-tuning execution steps – remember it’s beyond oneself; it’s about getting project to a better, more efficient place; it’s about running your team with candor; running your company in a smarter better way.

 * - credit to V. Zaretsky; author, and coach for a popular brainstorming game

Keep technology menu short


 Like at a good restaurant, the shorter menu is - the finer food.

 It all comes down to time. Time to explore for strong sides of technology, time to compensate for weak ones, time to onboard new members, time to retrain current team, time to adjust possible integrations, and processes etc.

Shorter menu to choose from ensures more time to improve team proficiency. Consequently, it frees up resources for experiments, and organized R&D processes, and further execution into transforming new technologies to meaningful improvements of operational frontier.

Alpha is as strong as omega resilient

 

Business is about helping people. Technology is about empowering business.

Business is about designing new opportunities, containing risks linked to them, and bringing them to a potential market.

Resiliency is a quality of technology. Allowing for timely execution of such opportunities, effective operational support, and smooth exits when time requires.

Team, technology, and resilience are three components which lay in the foundation of each business. Reinforcing each other, and eventually supporting transactions your customer desires.

In other words: focus on the key trio – your omega, and business alpha will follow.