This is about people in the first place

The past few weeks, the news has been littered with tech-industry lay-offs and the apparent need to “battening down the hatches” for the looming recession. My first thoughts are with the people involved and I’d like to express my sympathy for those who’ve been layed off. Especially those who’ve lost their job without consideration for the value they add, which seems random, unfair and a mistake from the leadership involved. That’s harsh and inconsiderate. The damage that will do to the people involved and those who remain behind should not be underestimated. In short, it sucks for all involved.

Why

I’ve been contemplating a bit on the why of this and to understand what’s going on. To share some insight I’d like to steel man the case for “the business” on why a reorg is necessary, especially looking at what happened at Twitter.

Steelmanning the case

A business needs to remain competitive and desirably profitable. The latter, with the advent of VCs, shareholder pressure and growing businesses ever faster, seems to be less relevant. So, what is the relationship between competitiveness and the layoffs? The logical reasoning is something like this: “If a company expects their revenue to drop, they have less income available to support the run rate of the organization (or simplicity, to me, that represents all OpEx, including peoples wages and associated cost for employment). The easiest way to cut cost is to “not spend the money” and spending it on people is the most obvious saving.”

Situational awareness

There is a deeper motivation that may not be obvious, but that is significant although less headline material. I’m talking about increasing situational awareness. As we know from military operations, having the right level of awareness for the environment you’re operating in is a way to gain an advantage over an adversary. One of the means to achieve that is by having good/strong communication practices and -channels available in which information flows easily up-and-down the chain of command. The way to improve internal communications is to have less information distortion throughout the organization and thus improve the flow. One way of doing this is by “flattening” the org chart, removing layers removes distortion and delays. Additionally increasing the span of control of mangers and becoming more synchronous (in lock step) with all involved also improves the speed at which information travels, thus contributing to the general awareness of the organization.

Side effect or true objective

What maybe perceived as side effect of working in stronger synchronicity is, that through a leader picking up the reigns tighter, the leader is basically enforcing a stronger compliance regime. For example subordinates “have to listen, acknowledge orders and follow explicitly”. This establishes a new, stronger position for the leader and sends a clear message to the subordinates to fall inline or leave. No more dissent, no longer a distributed way of decision making, leaders demanding attention and authority, centralizing the leadership and orchestration of activity.

My take is that it is not a pure side effect but was intended to have this effect, especially to counter the ““activism”” we keep hearing about. The approach may deliver a really good short term outcome for @ Elon Musk, the new Chief Twit, stepping into an organization that has drifted into a s### storm. But it also is a style of leadership that creates passiveness in individuals being lead. The long term effect is that it places a high toll on people and over time that will induce things like burn-out if not managed with empathy. The other side is the hard reality, that if Twitter isn’t able to change course, it will fail and all is lost. That stake is not something to be underestimated or taken lightly, so all the respect for people stepping in/up to save Twitter.

Drifting into autonomy chaos

At Twitter, the recent changes counter a motion that we have “seen happening” over the past decade (I was not on the inside, so this is speculative and is based on what I’ve picked up from public talks and other news sources). Twitter seemed to have had a relatively relaxed leadership that valued the autonomy of teams, and for good reason, it made then successful. This allowed the organization to experiment, find new ways to innovate the product and grow rapidly. This was a very successful formula when the company was still start-up like and growing rapidly.

Crossing the line

Apparently when a company grows beyond a certain threshold or a certain size, the autonomy that was once so successful becomes a source of chaos. This may be explained as “the head doesn’t know what the tail is doing”, one could label that as pure chaos. This is a problem of scale we see often in large IT organizations, let’s call them Enterprises. The problem that this apparent state of chaos brings along is that, when exposed to external pressure like a looming recession, internal competition and dissent will take the overhand. Especially when talented people, that have for years and years, made their own decisions. When these decisions, which normally only influence their own realm, now influence the entire company, it’s easy to see (in hindsight) how that creates conflict. The forces that arise from those conflicts may even tear an organization apart because it touches the fundamental powers and trust that people have earned through their hard work. If that’s taken away, people will feel robbed from their fundamental values.

The antidote to chaos

The apparent antidote to this chaos and resulting conflict has to start at an earlier stage. Its defined as “Voluntary alignment with the business goals”, and includes periodically recurring checks (and balances) to stay aligned. We know about this in their modern form as Objectives and Key Results, OKR for short. It’s key that the alignment is voluntary, since that helps the intrinsic motivation of the people to align with the business goals, whilst still providing a means to have control over their own realm in the business. So the individual or team has control, has “a say” and has “a way” to express how they contribute to the larger organization.

Origins

In the late 80’s Andrew S. Grove, then Chairman and CEO at Intel had written a book on these practices. The book : “High Output Management” captures from a managers perspective how to run a business properly with regards to the act of management. Nowadays we will raise a few eyebrows over some of the suggested practices which align more with a Tailor-esque way of managing than with what Daniel Pink in his book “Drive” would suggest what behavior a leader should display. However, the book contains a section on alignment of goals and goal setting in large organizations, the origin of objectives and key results. That was the later inspiration for John Doerr, also a former Intel exec, current venture capitalist and company coach, who elaborated on OKR in his book “Measure what Matters”. His presence and his book popularized the use of OKR throughout Silicon Valley, with remarkable results at Google and others. On youtube you’ll find many talks/presentations on the topic. This interview in particular is a nice primer on the topic.

OKR in the modern Enterprise

What matters for enterprises is that the simple fact of “being aligned before you act” is essential. This ensures everyone is acting inline with the intended direction of the whole. Enterprises are so large and hard to steer (change direction), therefore it requires exceptional forms of communication skills to ensure the state of the business remains in sync, harmonious and capable of dealing with its surroundings. Applying OKRs will help alleviate some of the burden of staying aligned. It doesn’t diminish the value of having in-person conversations but it makes the essential alignment explicit. That in turn allows for a bit more autonomy of the individual, avoiding the need for micro-management and thus allowing for significant scale of aligned effort to be created. As with many things, it’s not a silver bullet but it helps, that’s good enough an excuse to start with OKRs.