The secret to successfully combining strategy and planning

Good morning. Spring is in full swing, and people in the Bay Area know this because we see the first ants pioneering through our houses. It’s time to get our defense systems prepared, but it’s an endless battle. Based on findings of Californian scientists, one of the largest ant colonies in the world, a 600-mile-long subterranean network of Argentine ants stretches from NorCal to the Mexican border. And while we are talking about complex systems…

Today we’ll explore the causes of a lack of strategy and proper planning in increased complex systems (tech, not ants). Symptoms can often be spotted through classic phrases like:

• “We have other priorities.”

• “We don’t have enough resources.”

• “We are blocked by another team”

• Personal fav: “When was this decided?”

We’ll examine the causes of these symptoms, explain why they occur, and discuss what can be done to prepare against misalignment.

And guess where strategic misalignment prefers to make a grand entrance at lightning speed? As new teams are being created, objectives change and new dependencies are introduced at fast-growing or fast-changing companies.

Why does this matter? My journey to enlightenment

Initially, I viewed business strategy as a lofty concept reserved for boardrooms and high-level executives. It seemed disconnected from the day-to-day grind of my work and certainly nothing I needed in a fast-paced startup.

Little did I realize that strategy isn't just a buzzword for corporate meetings—it's the secret sauce that fuels success at every business level. As I delved deeper into the complexities of leading digital products during phases of high-speed company growth and when adding more systems into the product mix, I began to see strategy not as an afterthought but as a fundamental tool for navigating the ever-growing complexity of systems I worked on.

A poorly managed strategy in digital product environments can lead to

• Project slowdowns and delays

• Unanticipated blockers

• Security risks

And on top of all…

• Teams that are as aligned as a flock of seagulls in a windstorm - lots of flapping, but no one’s headed in the same direction.

Simple systems, easy to align

When I started early in my Product Management career, working on mobile apps with few dependencies, I knew what needed to be done daily and the status of the systems I depended on (client and server).

The vision for our app was clear, and we needed to execute it. What helped was that the whole company existed to run a few different apps. This was in 2012 when everything shifted to mobile. I would line up my requirements into user stories and sequence them for front-end and back-end development. Both systems had no conflicting priorities with other systems.

As a product ecosystem expands, this model becomes unsustainable

And the below is exactly how my Product Management career evolved.

After mobile apps, I started working with a company that had an IoT device/sensor in the product lineup, and that instantly added layers of complexity. Suddenly, I was tasked with managing sensor data, aligning my launches to the sequence of firmware updates, and changes to attributes that impact upstream systems.

Adding operations around these hardware devices - suppliers, storage, shipping, and logistics - requires meticulous planning. If you expand sensors into its own compute unit, running system software, the complexity deepens even more.

Let's imagine you also set up a factory to produce this hardware, adding another layer of complexity. This factory runs on the software you develop and integrate with. Talk about escalating complexity… again, exactly what the stages of my career were. It does not get boring.

Unsurprisingly, as your systems expand, they'll have varying requirements, development efforts, and timelines. Whether implementing new features or addressing bugs, each system operates somewhat independently. However, every iteration on ANY of these systems has a ripple effect, impacting systems up and downstream.

An attempt to visualize this growing complexity:

In the fast-paced world of software development, establishing a clear strategy with defined goals and objectives is paramount. It's not just about setting priorities within each system—it's about knowing WHY certain tasks take precedence over others. These answers stem directly from top-level strategic goals, which need to be the same across all systems in order to facilitate planning and execution.

This email does not focus on how companies set objectives and what goes into deciding these. Going forward, however, I will pick interesting stories that lead to certain company objectives. For today, we now step into how to bring strategy and planning together as the next step.

Setting company objectives is a good start. Aligning the systems to these priorities is paramount. But there is one more gap.

What if some systems need to contribute to all objectives but can’t possibly do it in the given sequence or time? This is often a blind spot.

Furthermore, achieving an objective becomes highly uncertain if systems have cross-dependencies without cross-functional commitment. A planning miracle is needed across all systems, including a feedback loop back into the top-level company objectives.

How can we bring strategy and planning together?

Entering the room… Airbnb

In an attempt to solve the planning process around the main question: Who is responsible for what, when… the product and strategy leads, Lenny Rachitsky and Nels Gilbreth developed this framework. They called it:

The “W Framework”

It might not solve all planning pains, but I am a big fan because I see it being used successfully in other companies as well. This is a top-down planning process. Effective as companies grow larger with several systems and teams, as outlined above.

It is made up of 4 steps.

Once teams get the context, they can develop their required execution strategy. They need to take dependencies and capacity into account and then report back. Leadership needs to integrate by helping all systems prioritize across these goals. Now, leadership has data it can work with based on each team’s execution strategy and needs.

Step 3, integration might not be straightforward, as more tradeoffs need to be made within teams that need to integrate cross-functional asks now. But it triggers the right conversations. This is the essential step to recalibrate what is doable or where capacity might have to shift.

Lastly, all teams commit, buy in, and get going.

Frequent changes to the overall objectives can create utter chaos that needs to be organized by going through the steps above AGAIN.

The frequency of doing this can differ, but it can work well as a yearly planning process for the company. Then, realignments need to happen quarterly. If it is more frequent, the observant reader can correctly assume that this is a big time investment, but it brings massive value when teams work in lock-step.

AI Corner

A list of the current top 8 AI startups in the world according to capital invested. As known, Microsoft has an economic interest in OpenAI (as recently clarified), it does not own OpenAI. Amazon and Google have minority stakes in Anthropic and we all can’t wait for Databricks to go public.

The WSJ recently reported that Apple is looking for external partners to boost its own AI efforts. Sources say that Apple was in discussions with Google, amongst others. It would be worrying if Apple is falling behind internally in bringing out performant models. It may be just to bridge the gap until their own MM1 model matures.

Finds that made me spit out my drink this week

🏰 This Tweet showcases the R&D Campus built by Chinese Telecom giant Huawei. It covers 1.4M square meters and contains replicas of some of the most prominent buildings in Europe. Kitsch or cult? They should have built Hogwarts if you ask me.

🍕 Domino’s is quite successfully growing outside the US, too, except for Italy, where they failed.

📞 Naval Ravikant launched AirChat on Product Hunt. It’s an audio X (former Twitter). It's an interesting concept and fun to try out. As with all new social media experiments, the risk is that industry leaders can quickly copy the concept and outpace a new app if it gets product-market fit. I am curious to see how it develops.

That’s it for this week. In the next one we will take a look at another ingenious Airbnb story that kick-started their growth.

If you know someone who would benefit from this content, please send it to them. It would mean the world to me. Thank you.

Thanks for reading,

Sebastian