The dilemma faced by founders and CEOs of startups can be summed up in this question: “When I am not sure, myself, whether we are going in the right direction and doing the right things, how can I lead a team that is pulling at different directions? How can I be assertive about what takes high priority and what doesn’t ?”
Advocates of ‘lean startup principles’ (LSP) and ‘product-market fitment’ (PMF)caution that too much confidence about what is right and what needs to be done often leads to costly failures. Startups are advised to have an experimental outlook towards product and market-related strategies. To fail fast and fail frequently, to achieve product market fitment as quickly as possible. It is also emphasised that the success of a startup is not in individual brilliance but in team work.
Whether by design or by default, startups do face a lot of small and big failures in the early years. So founders / CEOs find it increasingly difficult to assert their authority in matters of execution. They may harbor a nagging doubt about their moral right and capability to lead and would try to shift the responsibility to the team.
But it is also equally emphasised that the success of a startup depends on execution. If there is no assertive leader focused on strict time-bound actions, if there is no conviction about the product direction or market direction, if people are allowed to create their own set of priorities in the name of team work, then the result is drifting chaos, tinged with a sense of dejection and helplessness.
Assertiveness, use of authority to enforce deadlines and promises, clarity and conviction about direction, priorities, action points - all these may appear to be in direct conflict with the experimental nature of LSP and PMF. But, they are not.
The willingness to change plans (based on learning and feedback) every month, every week and every day is very important. But the discipline to execute systematically as per plan is even more crucial.
To hold people inconsiderably accountable to what they are expected to do is not mutually exclusive to the openness required to empower teams and listen to them.
And, most importantly, a leader’s moral right to lead does not come from or get reenforced by success and neither does that right erode because of failures. The capacity to lead a team or organisation into unchartered territory actually grows with each failure. So a leader should not shy away from putting her foot down and be assertive in matters of execution.
This is quite the opposite of leadership in successful corporations. And is rightfully so.
Changing the plans and priorities as frequently as needed is an important tenet in LSP and PMF. Team work, empowerment and listening skills are all necessary in formulating plans and revising them.
But, if there is too much debate and very little agreement on certain plans, the leader has the right to override and decide what he/she thinks is best in a given circumstance. Even if such decisions lead to failure, the leader should own up to them, but continue to override and decide when necessary. And the team remains accountable to the priorities and pre-set deadlines.
That plans change frequently, or previous plans resulted in failures cannot be an excuse for an individual or a team not to execute as per plan.
For founders and CEOs who are leading startup teams, the pride with which they wear their failures on their shoulders will decide the courage and assertion with which they direct people to go in a particular direction. Even when that direction is just a hypothesis testing with a high chance of failure, if it needs to be done, it has to be done.
Another myth I have seen in many startups is that all the hypothesis testing (and the failures associated with it) are left to down the line teams. The founder / CEO takes leadership role only for those validated projects that have a high chance of success. The opposite should be the case. All hypothesis testing should be lead from the front by the founder/CEO, owning up completely for the result/outcome, with the supporting teams rewarded for action and execution and not for results.
Out of these experiments, the projects that emerge with a high chance of success should be handed over to empowered teams, so that they can execute, repeat and scale.
- Lean Startup
- Statistical hypothesis testing
- Hypothesis testing
- Design of experiments
- Statistical inference