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Effective Strategies For Building Assumptions

Swarming is significant in a company's success to build and validate assumptions. To begin, whether or not a company has an effective strategy plan for creating assumptions is the difference between a company’s success or failure. Previously, our company had a client who assigned everyone to different initiatives, trying to work on everything at the same time. They didn’t have enough resources to do (both) the current buildout and work on the future vision, to prove things out at the same time. Before we get any further, know that swarming:

“occurs when as many team members as possible work simultaneously on the same priority item.”

So, companies who do not swarm will not have resources to do both. Consequently, people feel pressure to build on things in the present instead of in the future. In other words, with the resources available, the forecast shows that this company did not have enough to develop a future vision. As a result, they sacrificed completing hypothesis testing to ensure the correct solution. These actions reveal a mindset, “I have a limited number of resources and so I will gamble with the work I have without solidifying my assumptions and hope everything works out.”

Structurally, many companies find themselves forced into this position. In the future, when this process takes place:

  • Forecast, build out, and forecast again.

  • Figure out what research you need and what hypothesis to test.

    • This leads to a drastically different outcome because now you’re planning to do both.

“Your performance depends on your people. Select the best, train them, and back them. When errors occur, give sharper guidance. If errors persist or if the fit feels wrong, help them move on.” - Donald Rumsfeld

As part of my theory, everything that we do, pertaining to strategy, has been built on trying to spur people into action. It has been so focused on action, that in our vision, we use verbs when we describe our actions and when we create guidelines. The first thing leaders do is document the activities people are going to complete when they should be documenting assumptions. In an industrialized society, where widgets are made, this method works. In this environment, the boss/supervisors do less work than the people building the product. These supervisors assign activities and distribute them among employees before they rate their performance with standard performance management regulations.

But our society has changed and we live in an era with knowledge workers. The output for most people, 60% of the workforce, produce decisions instead of widgets. What these leaders should be documenting or controlling isn’t activities because they change based on decisions. What leaders should focus on are making the right decisions. If it so happens to be the wrong decision, change the decision (as fast as possible).

From a traditional approach, the idea is:

  • we want to avoid rework and as a consequence,

  • spend more time analyzing and coming up with a plan,

  • and then, follow through with the plan.

The thing is, if you make a decision based on incomplete information; then make a plan based on that decision (that could be wrong), the plan is now wrong because the decision was wrong. With Agile, you will do rework, you will switch gears, and abandon activities. The expectation should be that you will not follow the plan, the plan will change (and it should). The assumption should be that you started with the wrong plan, we didn’t have all the information and/or the environment changed.

For instance, with the pandemic taking the world by storm, the guidelines on what precautions to take and how to keep yourself safe has changed over the last year. In the beginning, CDC told people to wash their groceries when they got them because they had little information on how people were retracting the virus, it was an early assumption. We learned later on that was not how people were retracting the virus. The information changed, so the decisions changed, altering the guidelines. Some people see the CDC changing the guidelines and figure they do not genuinely know what they are doing or that the CDC is misleading or untrue. These people simply don’t understand that as they get new information, they learn, so their decisions on how to help us stay safe change.

“Incorrect assumptions lie at the root of every failure. Have the courage to test your assumptions.” - Brian Tracy

There is a paradigm in our society (and businesses) that is detrimental for progress. Employees often believe they are not allowed to discuss their personal thoughts, opinions, and/or pursue any course of action until they’re 100% sure it is achievable; this creates analysis paralysis. Ergo, if employees are punished for acting on things before they are sure, then what managers (boss/es) do is force them not to act. At Bridgeport, in many of the cases we work on, you have to act. Environments change quickly, so instead of waiting to act until you have 80% of the information, act when you only have 30%.

The new paradigm shift means tearing down old institutions that rewarded the old paradigm. The performance management systems that we have reward people based on behavior. As knowledge workers, they gain more information and change their decisions, this leads to certain activities. Hence, whatever activities agreed on should be judged on upfront change; knowledge workers should be doing different activities. Tying the performance to the activities agreed to at the beginning of the year, (even when knowledge workers figure out they should be doing different activities) and tying their bonus to the activities agreed to means employees won’t switch because they want their bonus. Knowledge workers are forced, because they’re paid accordingly, not to adapt or optimize the organization.

Performance management should change its mechanisms from the evaluation process it is, judging people based on performance and paid compensation, to skill development and obstacle removal process. So instead, as a boss, try to figure out what stops employees from making the best decisions, remove it; thus helping them make better decisions. Unless the system changes, people will focus on the activities instead of challenging assumptions. It is crucial for knowledge workers to have the freedom and flexibility to correct assumptions, especially if the assumptions are incorrect; a transparent approach helps companies truly align.

“Management is doing things right; leadership is doing the right things.” - Peter Drucker

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