How to turn your great ideas into actual results
Most investors and entrepreneurs agree that the key ingredients in most startup growth successes are luck, timing and execution.
But for every high profile unicorn lucky to pick the right market at the right time and seemingly get carried on a wave to a blockbuster IPO, there are hundreds of others who inch their way to the promised land by grinding and executing.
Grinding is hard because there are always more ideas than there are resources to execute them, especially when growth is slow. I’ve yet to meet a company that has a problem ideating but I’ve met plenty that have problems turning those ideas into results.
The problems typically show up in 3 ways:
Prioritization—when teams debate ideas without a common framework for evaluating them. Priorities end up being based on ad-hoc data and qualitative inputs and lack cohesion, which leads to confusion and conflict.
Planning—when normally siloed teams realize they need each other to deliver on priorities but lack a framework around which to align. Planning turns into horse-trading, which leads to customer needs taking a back seat to politics and commitments that aren’t held.
Actuals—when goals aren’t hit and the reasons aren’t clear, opinions trump data, leading to knee-jerk strategic shifts and organizational chaos.
Having faced these problems several times as an exec, I developed an operating framework to align the company around a growth strategy and translate it into execution. It combines the structure of product development process, which I learned early in my career with and the transparent accountability of sales, which I learned after I became a CEO.
The remainder of this post outlines the framework and illustrates how to use it.
The framework is made up of components and processes for moving between components.
The eight components are:
Strategy. What is our approach to growth?
Metrics. How do we measure our strategy?
Initiatives. What are the things we can do to move the metrics?
Priorities. What order are we going to do the initiatives in?
Resources. Who is doing the work and how long will it take?
Goals. What result do we expect from executing each initiative?
Actuals. How do our results compare to our goals?
Variance. How do we explain the difference between our goals and actuals?
To illustrate the processes let’s apply the framework to a basic B2B sales funnel:
1. Strategy → Metrics
Goal: identify the key components of your growth strategy and the metric you’ll use to measure each component.
Key Activities: choose components and growth metrics that can be combined into a growth model. A growth model which you can think of the equation that expresses your growth outcome (in this case Monthly New ARR). If you can’t combine your metrics into an equation it’s a clear sign your growth strategy is disjointed.
Exit Criteria: Make sure you can measure each metric and establish the current baseline. Create an initial tops-down goal for each metric so that you can get an idea of the compound impact of hitting all the goals. But remember that the tops-down goal is not the final goal!
2. Metrics → Initiatives
Goal: identify all the initiatives you could potentially pursue to advance the growth strategy and to line them up with their relevant growth metric. This ensures ideas are surfaced early and filters out ideas that are not aligned with the growth strategy.
Key Activities: an effective way to generate initiatives is to have a brainstorming session where everyone writes down their ideas for growth initiatives on post-it notes, puts them on the wall (or a Mural board) under the relevant growth metric and then votes on them.
Exit Criteria: Make sure you get all known initiatives onto the grid before you move to the next stage. Otherwise I guarantee you someone will waltz in at the eleventh hour with a “genius idea” that disrupts the whole process.
3. Initiatives → Priorities
Goal: prioritize the initiatives based on the effort required to execute and the expected reward from doing so. Essentially an ROI estimate.
Key Activities: Define the ranges of effort and reward that are applicable to the size of your company for example “S” could mean two people for a week, whereas “L” could mean a whole team for 2 months and “$$$” could mean $100k+. It depends on the size of your company. Write a description of each initiative that is sufficient for estimating the ranges of effort and reward. Ideally the person who presented the initiative is the one who writes the description and the team that would be responsible for executing it takes the first pass at estimating effort and reward. Rank the initiatives based on the combination of effort and reward i.e. low effort, high reward at the top and the inverse at the bottom.
Exit Criteria: Draw line where you estimate your resources will be full allocated. Everything above the line moves into planning. The rest remains prioritized on the backlog.
4. Priorities → Plans → Goals
Goal: add sufficient fidelity to the prioritized initiatives to have confidence in the target date for completion and the estimated impact.
Key Activities: assign each initiative an owner, who will be accountable for directing resources and reporting progress. Make sure the owner has sufficient authority to do both these things and that the organization understands the owner’s role. Sum the estimated impacts of each initiative into your top level growth metrics to get a first look at your bottoms-up goal. It will probably be lower than your tops-down goal but don’t just round it up and call it “stretch”. Instead go back and review the assumptions and see if there is additional upside.
Exit Criteria: The output of this stage is the set of the goals you are going to execute against.
5. Goals → Actuals → Variance
Goal: understand the variance to goal and to act upon it in a methodical way.
Key Activities: Make sure you have gathered enough data to observe and explain the variance before taking any action. This takes patience. I’ve lost count of the number of founders who have dismissed ideas too early by rushing to conclusions with insufficient data. The initiative owner should be the person that explains the variance and determine the action.
Exit Criteria: Act on the variance in the order shown above—start with (1) refine the plan. If that doesn’t work move to (2) pause the initiative and replace with the next priority from the backlog. This should usually be sufficient if you’ve done a thorough job in the Metrics—>Initiatives stage. But if not, move to (3) and identify additional initiatives.
Hope you find this useful! I’d love to know what other frameworks and approaches you are using in your business to turn ideas into results.
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