Note: This is the narrative article version of a talk I’ve started giving recently at conferences, product meetups and corporate leadership teams.  It is a long read, but I believe it’s a critically important topic, and it lays out for people many of the topics I will be writing more about in the coming months.

Introduction

The main topic of my work, and the central topic in my book INSPIRED, is product discovery.

What are the skills and techniques used by the best product teams at the best product companies to solve hard technology problems?  I love this topic, and between the various risks (value, usability, feasibility, and viability), the various forms of prototypes for tackling these risks, and the many qualitative and quantitative techniques for testing these prototypes, there is so much to say.

However, over the years I have found that many teams get quite good at the techniques of product discovery, yet are not able to actually apply those techniques and work the way they need to.

As much as I hate to admit it, teaching a team how great teams operate is just half the problem, and it’s the easier half.

The issue is that they are often not allowed to work as they need to.  Specifically, in so many companies, they are not truly empowered to work as they need to.

Many of us in the industry describe this difference as “culture,” as in the companies that get this are said to have a product mindset or culture, and those that don’t are said to have an IT or project mindset or culture.  

But I’ve come to believe that’s not especially helpful.  Amazon, Google, Apple and Netflix are all very strong product companies, yet they each have very different cultures.

Don’t get me wrong, I still believe culture is extremely important, but there is something about great product companies that is more fundamental and more specific.  And it really gets down to their views on their people, and how they should work together to solve problems.

In this article, I want to share some important lessons I’ve learned about this particular aspect of culture that makes such a profound difference in the results.

Extraordinary Teams

I have long argued that innovation is all about the team.  But rather than focus on the techniques these teams use, let’s look at the actual role or purpose of the team in the broader organization.

In most companies, technology teams exist “to serve the business.”  That is very often the literal phrase you will hear. But even if they aren’t explicit about it, the different parts of the business end up driving what is actually built by the technology teams.

However, in contrast, in strong product organizations, teams exist for a very different purpose.  They exist “to serve the customers, in ways that meet the needs of the business.”

That is a very profound difference, which really impact nearly everything about the team and how it works, and results in a much higher motivation and morale, and most importantly, higher level of consistent innovation, and the resulting value for customers and for the business.

The odd thing is that the virtues of truly empowered teams are not a secret.  In fact, there’s many very inspiring books and articles that describe why these types of teams are so much more effective at innovation and in solving hard problems.

While I found these books inspiring, and well worth reading, most companies have not been convinced to empower their teams in any meaningful sense.  Why is that?

When I ask CEO’s and other key leaders of these organizations, the answer typically boils down to one word: trust.

The leaders don’t trust the teams.  Specifically, they don’t believe they have the level of people on their teams they need in order to truly empower them.  So they, along with the other key business leaders from across the company, believe they need to very explicitly direct the teams.  This is also known as the “command and control” model of management.

When I ask these leaders why they don’t put people in place that they do trust, they usually argue that they either can’t find, can’t afford or can’t attract the level of people that Google, Amazon, Apple and Netflix hire.

I then point out to them that they would be surprised at how ordinary the vast majority of the members of these company’s product teams actually are, and that maybe the important difference lies elsewhere.  

Maybe these strong companies have different views on how to leverage their talent in order to help their ordinary people reach their true potential and achieve, together, extraordinary results.

Leadership vs. Management

When technology product companies moved to Agile methods over the past 10-15 years, there have been many managers that questioned whether they were still necessary since the members of teams are expected to take a much more active role in how they work.

I realize this is counter-intuitive to many people, but moving to truly empowered teams does require moving away from the command and control model of management, but this does not mean you need fewer leaders and managers, it means you need stronger leaders and managers.

It is actually easier for a manager to just micromanage in the old command and control style.  It’s not hard to just assign a team a list of activities, or a list of features to build, and just tell them to do the work as fast as they can.

While this command and control style may be easier for the manager, it leads directly to teams of mercenaries, and no empowerment in any meaningful sense.

Leadership and management are often lumped together, and it’s true that many leaders are also managers, but the responsibilities are very different.  Both are essential to an environment of truly empowered teams, and I’d like to discuss each in turn.

The Role of Leadership

The subject of strong leadership is a major topic in and of itself, worthy of entire books.  But it is a clear and visible difference between strong product companies and most companies.

The purpose of strong leadership is to inspire and motivate the organization.  This involves five major responsibilities:

Product Vision

The product vision is the shared objective for the product organization.  There may be on the order of a hundred cross-functional product teams, but they are all trying to head in the same direction, and contribute in their own way, to solving the larger problem.

Some teams refer to the product vision as their “north star” in the sense that no matter what team you’re on, and what specifically you’re working on, you can all see and follow the north star so that you know how your piece contributes to the more meaningful whole.

The product vision gives the organization its purpose, and we only want people in our organization that are excited about and dedicated to this vision – missionaries.  More on that below.

Product Strategy

The product strategy refers to our plan for accomplishing our product vision.  The plan is not referring to a detailed schedule, although it may include major milestones.  The strategy needs to be compelling and well-reasoned. Without the strategy, two bad things happen: teams struggle because they don’t see the path from where they are today to the 5-10 year product vision; and they too often try to please too many types of customers in a single product and they end up pleasing no one.

Product Principles

Product principles speak to the nature of the products that your organization believes it needs to produce.  The principles reflect the values of the organization, and also some strategic decisions that help the teams make the right decisions when faced with difficult trade-offs.

Product Priorities

There is always much more we want to do than we can do in a given period of time, and it’s on leadership to make the high-level prioritization decision to clearly state what’s most important.  If the organization is using OKR’s, this is where the leaders of the organization define the objectives and key results for the organization as a whole.

Product Evangelism

Another under-appreciated role of the leaders is in communicating the vision, both to the product organization, and also across the company more broadly.  If we want teams of missionaries, it’s essential that every person in the organization understand and are convinced – they need to be true believers. This comes from an ongoing crusade of evangelizing – in recruiting, all-hands meetings, team lunches, one on ones, and everything in between.

The larger the organization, the more essential it is to be very good at evangelism, and it’s important for the leaders to understand that evangelism is something that is never “done.”  It needs to be a constant.

John Doerr, the famous venture capitalist, and champion of OKR’s, likes to explain that “we need teams of missionaries, not teams of mercenaries.”

This is a critical trait of empowered teams.  We want to ensure that every member of the team has joined the team because they sincerely believe in our larger purpose.  

Normally it is the product vision that describes this purpose that people are signing up for, but one way or another we need to ensure the people on the team are believers.

If your vision is to deliver mass-market electric cars to market, then we need people that are willing to take the leap of faith that this is both possible and worthy.  Note that it is not a problem if the person you hire has different views on what might work to get us to mass-market electric cars, but it is not helpful, for example, to hire an advocate for internal combustion engines.

The Role of Management

There are of course many types of “managers” in a company.  I’m interested here in those people responsible for hiring and developing the actual members of the cross-functional product teams.

Normally this includes the director of product management, the director of user experience design, and the managers and directors of engineering.  I’m not focussed here on more senior level managers (managers of managers), or non-people managers (like product managers or product marketing managers).

If you want to have truly empowered product teams, then your success depends very directly on these first-level people managers.

It is important that these managers understand, and can effectively communicate, the vision, strategy, principles and priorities from the senior leaders, but beyond that, these managers have three critically important responsibilities:

Staffing

These are the people we hold responsible for staffing the product teams.  This means sourcing, recruiting, interviewing, on-boarding, evaluating, and when necessary, replacing, the members of the teams.  If you have an HR function at your company, they are there to support the managers with these activities, but they are in no way a substitute for the manager on these responsibilities.

Coaching

Probably the single most important, yet most often overlooked, element to capable management is coaching.  At the very minimum this involves a weekly 1:1 with the people that report to you as their people manager.

It is the most important responsibility of every people manager to develop the skills of their people. This most definitely does not mean micro-managing them.  It does mean understanding their progress every week, and providing guidance on lessons learned, removing obstacles, and especially what is loosely referred to as “connecting the dots.”

For example, let’s say you are the manager of product design, and you meet each week for an hour or so with each of the 6 product designers that work for you.  These 6 product designers each sit with their cross-functional product teams (because design is a first-class activity and as such it needs to be right there with the product manager and engineers as they tackle and solve hard problems).  But even if that designer is exceptionally skilled, how can he or she be expected to keep track of what is going on with all the other product teams? What if the design they are working on right now for their situation, is in some way inconsistent or incompatible with solutions underway with other teams.  The design manager is expected to flag these conflicts and get the relevant designers together to consider the bigger picture and the impact of the different solutions on the user.

More generally, every member of a product team deserves to have someone that is committed to helping them get better at their craft.  This is why in the vast majority of strong tech product organizations, the engineers report to experienced engineering managers; the designers report to experienced design managers; and the product managers report to proven managers of product management.

Objectives

The third responsibility of the people managers is to ensure that each product team has a clear and relevant set of objectives they have been assigned (typically quarterly) which spells out the problems they are being asked to solve.  The most common technique for this is the OKR method.

This is where empowerment becomes real, and not just a buzzword.  The team is given a small number of significant problems to solve (the objectives).  The team considers the problems and proposes clear measures of success (the key results).  The managers may need to iterate with their teams and others to try and get as much coverage as possible of the broader organization’s OKR’s.

The litmus test for empowerment is that the team is able to decide the best way to solve the problems they have been assigned (the objectives). 

It takes strong managers to be self-confident and secure enough to truly empower the people that work for them, and to stand back and let the team take credit for their successes.

Assuming we have competent leadership and management, we can now return to the actual people on the product teams.

Ordinary People

When I talk to the leaders and managers that don’t trust the people on their teams, I find that they often have very antiquated, and I believe harmful, views on what types of people to look for.

So I ask these leaders and managers to consider a very different approach to staffing.

First, when I say “ordinary people” I’m not suggesting that you can hire anyone off the street and turn them into members of extraordinary teams.  They do need to have the necessary skills to succeed.

However, I am suggesting that rather than obsessing over “cultural-fit,” or finding so-called “10X” employees, or thinking you need to hire people with a deep knowledge of your domain, focus instead on what I’m about to describe.  

To be clear, there is most definitely such a thing as 10X employees.  These are people that have demonstrated their ability to contribute on the order of 10X more than their peers.  However, it’s also no secret that having a 10X employee does not necessarily translate into having 10X results. That’s because results in our industry come from product teams, and in fact if that 10X employee brings along toxic behaviors, you will likely cause far more damage than good.

Let’s discuss the characteristics you should be considering when recruiting and assembling strong, cross-functional product teams:

Competence

Stephen Covey explained that “trust is a function of two things: competence and character.  Competence includes your capabilities, your skills, and your track record. Character includes your integrity, your motive and your intent with people. Both are vital.”

We’ll discuss character next, but table stakes for any of your hiring onto a product team is competence. The person must have the necessary skills – either an an engineer, a designer, or as a product manager.

This is often where so many organizations plant the seeds of their future struggles.  

You’ve no doubt heard the old adage that “A’s hire A’s, but B’s hire C’s.”  A manager that is not an accomplished product manager, designer or engineer herself is ill-equipped to assess a candidate, and it is easy to see how the company can end up hiring someone that is not competent at the job.  Moreover, without the necessary experience herself, the hiring manager is not able to coach and develop that person to competence.

Normally we hire for competence, however, there’s nothing wrong with hiring based on potential, but if and only if the hiring manager is willing and able to sign up to actively coach that person to competence, and if they fail in that, to find that person a different job.  That’s a big commitment of time and effort on the hiring manager.

Staffing is one of the three key responsibilities of management, but to be clear, it’s absolutely critical to ensure competence.  Without the competence, the person and the team can not expect to be trusted by management or leadership.  So there is no true and lasting empowerment without competence.

Character 

Once we know the candidate has the required level of competence, most companies focus on what is usually referred to as “cultural fit.”  

This is probably one of the most damaging concepts to your efforts to build a great organization.  

Of the vast pool of people in the world, companies filter out almost everyone except those that are perceived as a “cultural fit,” which of course is a very ill-defined concept.

For most organizations, “cultural fit” is the politically correct term for what essentially translates into: “hire people that look and think like we do.”  In our industry, usually that means white men from top-tier universities with technical degrees, hiring more white men from top-tier universities with technical degrees.  In my experience, this is not usually conscious or intentional, but the results are plain to see.

I’d like to try to convince you that “cultural fit” is the wrong objective here.

Most people don’t know that the most successful sports franchise in history is not the New York Yankees, or the Chicago Bulls, or Manchester United.  It’s New Zealand’s All Blacks national Rugby team. They have an unmatched record of sustained dominance (over a hundred years).

The All Blacks learned a long time ago that character matters.  So they have a very clear and unambiguous policy in place when evaluating players and coaches for their team: the “No Assholes Rule.”

They understand that it doesn’t matter how exceptionally skilled a player or coach may be, if he’s an asshole, then he will be toxic to the team overall.

(As a side-note, fans of the All Blacks may know that they actually use a more colorful term than “asshole” but since their terms is offensive to some, I took the liberty of substituting the still vivid term “asshole,” which I am borrowing from the excellent book by Stanford professor Bob Sutton The No Asshole Rule).

So rather than narrowing a very large pool of people to the small subset that are perceived as a “cultural fit,” I argue to instead keep the pool very large, and just filter out the relatively few assholes.

The irony is that we know that competence and character are all-important to establishing the necessary trust, yet so many companies and managers hire either people that are “cultural fits” but not competent, or they justify hiring an asshole because they believe the person is exceptionally skilled.

One of the unintended and damaging consequences of hiring people “like us” is that they think like us. It’s not that the way you think is bad, it’s that what we really need are people that think differently than us. This is one of the most tangible and immediate benefits of adding diversity to your team. The chances of solving hard problems goes way up if you can approach the problem from several perspectives.

So rather than looking for people like yourselves, make it an explicit point to look for people that are clearly not like yourselves.  People that come from different environments.  People that were educated differently. People with different types of work experience.  People with different life experiences.

I find that when candidates are viewed through this lens, there are many excellent candidates to be found, all over the world.  Often they are hiding in plain sight in your own company. Just make sure they are competent and not an asshole.

Summary

Great teams are comprised of ordinary people that are empowered and inspired.

They are empowered to solve hard problems in ways their customers love, yet work for their business.

They are inspired with ideas and techniques for quickly evaluating those ideas to discover solutions that work: they are valuable, usable, feasible and viable.

Truly empowered teams that produce extraordinary results don’t require exceptional hires.  They do require people that are competent and not assholes, so they can establish the necessary trust with their teammates and with the rest of the company.

Truly empowered teams also need the business context that comes from the leadership – especially the product vision – and the support of their management, especially ongoing coaching, and then given the opportunity to figure out the best way to solve the problems they have been assigned.

I plan to write much more about the many topics raised in this note, but hopefully you can ask yourself if your team is truly empowered:

  1. Are you staffed with competent people with character, that are skilled across the range of competencies you need (typically, product manager, product designer and engineers)?
  2. Are you assigned problems to solve, rather than given lists of features to build?
  3. Are you accountable to deliver business results (outcomes) rather than shipping features (output)?

I hope you are working in an environment where this is true for your product teams.  If not, I would argue that your company’s future depends on the productivity and continuous innovation that comes from this model of work.

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