The problem that many of us face with technology is that most of our management techniques were created at a time when a two-way conversation didn’t exist. Instead, our management tools were built for a completely different pace of operations—the pace of the past century’s manufacturing economy. Operations in the manufacturing age were slower and more predictable. They rewarded a management approach based on planning, deliberation, and secrecy. The economies of scale in a manufacturing economy made it difficult to change plans in midstream, but there was less need to change plans in that era. Adjustments made on an annual basis were sufficient.
Digital technology has given us the new ability to have two-way conversations with our markets and our customers. What does the market want? And by market here, we mean people. (When we talk about being user centered, customer centered, and human centered, we’re referring to this idea.) Understanding the unexpressed and unmet needs of the people who are using our products, services, and technology is the key to unlocking value. In this ability is the key to success in the digital age: we don’t have to predict what will work. Instead, we can listen, make a credible guess, get feedback in nearly real time, and adjust.
In the digital age, it’s difficult, and sometimes impossible, to predict which product features are needed in the market. Yet often, we plan our features and manage our business cycles as if we know exactly what’s going to work. We manage by specifying outputs—what we’ll make. Instead, we need to focus on outcomes: management needs to declare the business outcomes they wish to achieve and then set up their teams to figure out how to get there. This means that we have to create the conditions in which teams can try different approaches, experiment, learn, and discover what works through trial and error.
Modern digital development practices allow teams to make small changes in an ongoing way. This allows them to make the adjustments they need to make when they’re using a sense and respond approach. But it also changes how we plan, because we’re continuously learning and adjusting our plans as we go. And it changes how we budget, because we can no longer afford to make commitments a year in advance when we’re learning every day. And it changes how we market, and sell, and … so much more. We have to move away from big-batch manufacturing processes and adopt small-batch, continuous processes.
All great digital efforts are collaborations—between a creator and the audience. Between developers and operations people. Between designers and business stakeholders. You need to embrace collaboration deeply and break down walls where you find them. This means that we need to consider how we organize our teams, our departments, our programs, and our initiatives.