Are today's organisations more focused on delivering value?
In previous decades, product development organisations focused on delivery efficiency optimisation seemed to outpace practices improving effectiveness. What is the trend now?
It felt to me that the 90’s and early 2000’s were the decades of perfecting methods of delivery. There were the rise and popularisation of new technologies such as the internet and associated languages and frameworks for development. There were refinement of project management methodologies including iterative approaches such as lean and agile. And whilst design, testing and architectural practices also evolved it often seemed the parts of these practices which could most impact the value organisations delivered experienced the most friction. The feeling that the required effort might be a luxury.
I suspect today the proportion of organisations that have shifted to focus on a more value-oriented effort is increasing. By this, I am referring to the proportion of organisations that are more directly trying to refine the value they deliver rather than just their throughput.
The evidence is the growth in interest in practices such as OKRs, the adoption of various flavours of systems thinking, design, User Experience (UX), Customer Experience (CX) and design thinking. I concede that maybe there's always a similar level of interest in value-oriented practices and it’s just the names of the practices that keep changing. But even though the practices existed one rarely has to look hard to find the friction in an organisation for applying the practices to the necessary degree to achieve a satisfactory result.
But regardless of any modest growth in these disciplines... the alarming thing that remains is the sheer proportion of organisations that still invest their effort without a link to a tangible outcome at all. By link I mean a way to know the action they are taking will have the effect intended and when I refer to achieving an outcome I mean a positive impact for the intended beneficiary or having any means to check they are making meaningful progress towards doing so.
The world has gotten so used to planning in an activity-centric way that it has consumed all aspects of doing work. Our certainty bias and rush-to-solve bias are powerful disincentives against improving in this area. The problem is that effort checking you are making progress is easy to put off in favour of more action. Like exercise and eating well people may not do the things they know will help achieve a better result.
In some industries, growing competition and consumer expectations force them down this path of value focus. Software as a Service (SaaS) businesses with heavy competition this is particularly obvious. For instance take the intense competition in online travel sites - whether aggregators or travel companies. The convenience and fit to evolving user needs moves quickly. The degree of integration, the way information is surfaced to help decision-making, the cross-marketing to help solve other aspects of planning a trip are addressed. Looking inside these organisations there are high degrees of measuring all aspects of the business and acting quickly on information. If they don’t they get beaten by the competition.
Not every organisation has such instant consequences from not responding to market forces. As a result they continue on without quite knowing how they are improving or worsening in terms of meeting their customer needs and in turn, how they are progressing in relation to competitors trying to do the same.
Even for those organisations kicking the tires of actually starting with the end in mind and putting in the effort to measure the right things those biases make it very likely many fall back into defining outcomes in terms of actions that can be validated. They are also inclined to submit to the temptation of using measures that are also activities. They do this because they assume with unfounded confidence that these activities will achieve their goal and that they don’t have time to come up with a more appropriate measurement of progress. Activities as measures don't give any actual feedback they are heading in the right direction.
In my experience, the pairing the direction and feedback elements that goal-setting and measurement can provide must be paired with the practical methods of focusing on value, such as research and design discovery, which is unearthing a constant stream of insights into where the organisation is and is not meeting the needs of the users it serves, both outside the organisation and within. It also needs a strategic analysis of how the organisation is competing and serving a viable market to ensure its enduring relevance.
The direction setting and feedback measurement provided can support the investment in these activities by always focusing on what is most important and validating whether our assumptions on how to meet those needs are having the desired effect for the users and that is contributing to success for the organisation and its success and longevity.
So we can summarise more organisations are striving for more value due to forces of competition and expectation. Many may not yet realise improvement in value because it’s hard. Ingrained practices and biases provide a barrier to doing what is required. Part of addressing these issues involves identifying them so we can be conscious of when it’s happening and start to adjust behaviours.
How is your organisation doing? Is it trying to be more value-oriented? Are there practices being adopted towards this goal? How effective are those practices currently?