How to Unfreeze a Product Line With
The COVID economy created tough conditions for many product line teams. No one has ever seen uncertainty at levels like we see today. But I’ve dealt with the effects of recessions on product management and innovation. And I am surprised by one striking difference. In today’s COVID response, I believe some decision-makers don’t have a firm grasp on reality. And that’s scary.
I know I don’t have an empirical study to validate my concerns. And I don’t think there’s time to do one. So allow this time-tested consultant to share what I think is a huge deal that many companies need to address. It’s that:
Too many decision-makers and leaders are far too optimistic or far too pessimistic.
I first noticed this at the beginning of the COVID disruption. As I set out work to forecast scenarios for multiple products within product lines, I realized the uncertainty was far too high. It was near impossible to foresee what might happen to each existing product or the interplay across products.
And new product forecasts were random, although supported by nice-looking PowerPoint slides. But a problem arose during review meetings. The discussions were less about product outcomes than an exploration of each manager’s optimism or pessimism.
It turns out extreme uncertainty can change product review meetings into psychological assessments.
The problem isn’t with doing work or thinking creatively. Project management and execution seem fine. But governance and decision-making can be divorced from reality. The optimist and pessimist problem plays out with overseers, decision-makers, and influencers.
Optimist Vs. Pessimist
Optimists are vocal in online meetings. They reiterate a message to be resilient and keep doing “what we do best.” And the pessimist may say a few negative words, followed by silence. But the pessimist is more likely to call someone and detail every problem as soon as the meeting ends.
When uncertainty overwhelms a product line, making good decisions becomes a significant challenge. You’ll see the extremes of both positivity and negativity harm the process.
And when the extremes exist together, the situation becomes worse. Both orientations can lock your team into no decisions or poor decisions. And that shouldn’t be ignored.
But there’s a solution.
First, you must spot the problem. Watch how optimism and pessimism affect your leaders, decision-makers, and influencers. And if you see it, quickly move to the second and most important step. You must do the organizational work to move people to be realists so they can make smarter decisions and direct more impactful actions.
Just like in the general population, most organizations are composed of over 50% optimists and around 30% pessimists. That leaves less than 20% as full-time realists. The lack of realists is a notable problem when product lines must respond to enormous changes in markets and technologies, and in supply chains and customer behaviors. And in today’s COVID economy, these changes are far more than we’ve ever seen before.
Freud points to the optimist as burdened by ostrich-like behavior that embraces an alternative reality. And when results fall short, the optimist looks to squash the events from their memory. Pessimists, on the other hand, seem to have a death wish. They communicate failure as an “I told you so” summary of events. And somehow, pessimists see success as a result of serendipity, not rational thinking.
When there’s extraordinary uncertainty, as with our COVID economy, both pessimists and optimists struggle. The problem is to figure out where your customers, competitors, and business are headed. And it’s to carry out a sensible response. When uncertainty is high, both pessimists and optimists aren’t very helpful. The challenge for all companies is to guide decision-makers back to reality.
The goal is to encourage optimists to get their heads out of the sand. And it’s motivating pessimists to stop killing the organization with a Dr. Doom death-wish. We need the whole organization to accept the high uncertainty and deal with it responsibly. And research on the topic suggests the best way for organizations to do this is by setting clear priorities and acting on habits and systems. Let me explain.
Priorities, Habits, and Systems
Stating and sharing priorities raises awareness about what’s important. And optimists and pessimists rarely share the same priorities. Product lines communicate priorities as shared objectives and key results (OKRs.) While it may seem simplistic to create a set of OKRs, the significant gain comes from a shared awareness. Such awareness is a lens that helps focus and align decisions, judgments, and work. And shared priorities are enormously valuable when coping with high uncertainty.
Habits are automated behaviors tied to underlying assumptions. And habits form when an assumption holds steady. But when assumptions falter, as they have because of the COVID economic shift, old habits may start to harm a product line. Plus, you’ll find the optimist and pessimist build different biases into their habits. The result is the divergent bias and faltering assumptions combine to worsen the situation.
The third element needing change is a company’s systems. These are practices and processes that guide work and keep a focus on priorities. Not surprisingly, when a business confronts major change, existing systems don’t always provide the best guidance. The systems must also change, particularly with respect to governance and decision flow. And the new approach must drive toward reality and offset heavy-handed optimism and pessimism.
The big challenge for product line leadership is to orchestrate the change while improving the line’s performance.
In normal times, this job is complicated and frustrating. But in the uncertain COVID world and while many people work remotely, the situation demands far greater focus and commitment. It’s as if you’re trying to play a baseball game in a hurricane. People get blown in all directions. What you don’t need added to the storm are constant conflicts between optimists and pessimists.
The most surprising and illogical response is when top managers understand what’s going on but choose to conserve cash and don’t move forward with any changes. The judgment is to take no action and save money. And you don’t know if that comes from an optimist’s view that the situation will improve and therefore there’s no need to change. Or if it comes from a pessimist view that suggests “we’re so screwed, let’s just save all our cash.”
I want to make sure I’ve said this as clearly as possible.
Top managers must help their decision-makers and influencers get a grip on reality and deal with the high degree of uncertainty that optimists and pessimists struggle to address.
For many product lines, doubling down on optimism or pessimism is a wrong choice.
It’s Your Move
No doubt, the needed changes may take extraordinary effort. And you may believe it’s too difficult to carry out. But once you understand what you need to do and how your organization should do it, you’ll also know it’s both possible and necessary.
The needed change is a significant product line move in response to the COVID challenge. The good news, if there is any, is that your competitors and customers must also deal with the virus’s impact. Your goal is to deal with it better than your competitors and gain or preserve customer satisfaction. And of course, you must stay solvent.
The first step to embedding reality into your product line work and decisions is to understand you don’t have much time. In the old normal, you may have measured the needed change in years. But in our COVID economy, you may only have weeks or months. You don’t have time to handhold the optimist and pessimist and work through everyone’s psychological makeup. Instead, you must get on with it.
To navigate through the COVID economy and unfreeze your product line, I encourage you to set up and carry out Responsive Roadmapping. This approach clarifies the OKRs, tests the assumptions driving habits, and lays out the systems and practices to move your product line forward.
More importantly, Responsive Roadmapping speeds the actions and the strategy moves you’ll need to offset high uncertainty. And it calls on methods and lenses to pull optimists and pessimists back to reality. Learn much more about Responsive Roadmapping HERE.
The change effort to set up Responsive Roadmapping is different in the new COVID world than it was before. Now we see many decision-makers, influencers, and product line contributors working remotely.
But three change fundamentals stay the same:
- The change equilibrium says that for change to happen the pain plus gain must exceed the cost of change. This is an evaluation of how leaders and contributors view the situation. The first part of the change equilibrium is the view toward the pain of the current situation. The second part is the perception toward the gain from the new system (Responsive Roadmapping.) Together, the first two parts must exceed the economic and psychological costs of making the change.
- Those who must do work or make decisions and judgements within the new Responsive Roadmapping approach should be deeply involved in creating the framework and carrying out the change. The principle recognizes that people are more likely to use an approach they help create than one that’s handed to them. This is especially true for decision-makers and the decision flow they create.
- Training is not implementing. But implementing without training is fruitless. A smart roll out of Responsive Roadmapping demands training and teaching people across your organization. This includes a governance body and decision-makers, as well as project-doers and key contributors from other functions.
Not the Same
The big difference in the COVID economy is in how people work. There’s no research that confirms what to do – how best to carry out organizational change when many people are working from home. When the COVID experience is over, we’ll see the research. But by that time it may be too late for many companies.
Your goal must be to set up new priorities and new systems. And it’s to rid your organization of poor habits. Don’t let ostrich-like optimists and doom dreary pessimists freeze your organization. Such tolerance may help you end a meeting. Unfortunately, it may also allow a wave of COVID uncertainty to wipe out your product line.
The Realist’s Approach
Responsive Roadmapping is the realist’s approach to improving product lines. And it’s much needed to offset the uncertainties created by the COVID economy.
There are many resources available to help you move decision-makers and influencers toward a clear view of reality. But if you want the fastest route, just give me a call. I’ll send you what you need and talk through the work to tackle the job.
To learn more about Product Lines and Systems Thinking and to take needed actions, please visit:
- Understanding Product Line Moves HERE
And as always, please feel free to contact me.
– Paul O’Connor
See what Gartner Group says.