Emergent startups and concrete production

 I started working at the age of 14. I was bagging groceries and stocking shelves at the neighborhood grocer. The place was kinda gross. Weird things happened. The butcher stole steaks. The stock boys smoked cigarettes behind the building. People slept in the doorway overnight. Daily, I'd have to wander the neighborhood searching for shopping carts, folks had used to transport their groceries home. But we all knew who the boss was. Ken. Ken was a bulky man with a larger mustache. He was in charge. It was a messy franchise, but it was his messy franchise, and he let you know it. Paid only $4.15 per hour, I worked my heart out for him. 

As an adult, I've encountered many organizations including tightly coordinated military units, massive enterprise software providers, high tech cost centers, and horizontal startups.  The last one, the horizontal start up, is tough.

For a long time, I figured horizontal was everything. I tried to practice it too. But I learned through trial and error that many this approach is the result of uncertain leaders. Individuals who never had to lead diffuse their power through others. Sometimes it works, sometimes it doesn't. 

When it does work, it is because you have the best talent on hand. Those individuals know how to mobilize, coordinate, and get things done. It works well.

When it doesn't work, it is because the talent isn't there. People work in shadows. People talk too much or not at all. Projects never have a clean end, but sprawl and never get truly finished.

Either way, a company must have the ability to draw a line, to a diagram, end to end how the widgets get fabricated. Maybe Ken designs it. Maybe the team stumbles until they figure it out. Either way, the company is only getting started when there is  visible, universal alignment on the widget making.

If the process is only in your head, trust me, it is only in your head. Get drawing.

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Companies Need Transaction Design for Faster Technology Returns

Many profitable, hard working businesses find themselves burdened over time by their own tools and processes. Maybe a tool like Excel or Quickbooks was the right tool for the job, once upon a time, but now the organization has grown to keep up with customer demand and you find it hard to manage as those tools are now a burden.  Or perhaps your company is competing in a crowded market and you feel a pressure to continually invest in technology to compete. This makes sense, given how companies like Amazon and Shopify have dramatically shifted retail models with their technology-first approach to customer frustrations like shipping, returns, and check out. 

There are usually only two ways that leadership approaches these problems. First invest into optimizing current and known bottlenecks, and this is a sound approach. By and large it's a great approach because you can identify clear metrics and double down on improving the numbers. This is winning. The second is that you invest into novel experiments - new flavors, new materials, or new customer experiences such as a digitized checkout lane or AI voice assistance in the changing room. These projects are expensive, so are limited to small-scale pilots, and performance impact can take a bit of effort to measure. 

I've found that a third model also exists. This model only exists "sometimes, is fleeting, and requires an anthropological rigor to identify. I call this kind of work Transaction Design, when you are able to thoughtfully craft a new kind of financial transaction, often by using a simple technology. For example,  Plaid was created by a startup as an API solution to streamline transactions for investment tools like Robinhood, so individuals can make small investments with lower fees, and do this quickly. Another examples include Sophi's use of housing equity to offset student loans, enabling millennials to buy a home and pay their loans; or the notion that security deposits for apartments can be outsourced as insurance, so that millennials do not need to save 3X the rent, while reducing overhead compliance challenges for landlords.Here is the thing - any time a technology enables a capital transaction that could not previously exist,  it becomes a repeatable model. 

Transaction design can be implemented with speed and low-costs, unlike and expensive tech-heavy pilot of novel gimmicks, and creates new kind of customer insights with less investment. In fact, transaction design can generate rapid returns on existing tools, and give insight into how to design a tech roadmap for future capability needs, not just to amend current gaps. After all, isn't the biggest waste of money to only exist in meeting current market conditions, when those conditions are certain to change? No one wants that - especially share holders. 

How do you conduct Transaction Design in your company? You should not just run out and start trying to slam them into your current enterprise - that's for sure.  Also brainstorming exercises are never the best place to start.  Rather, you need to find the right expert, someone who understands the breadth of conversion models out there and has the means to understand your organization through its data, it's structural design, processes, and people. At the end of the day, it's always about the right people, because that part never changes.