April 28, 2024 | Read Online
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In his book, Thinking Fast and Slow, Daniel Kahneman outlines the two decision-making systems of the human brain.
The first, System One, operates intuitively. It’s effortless, involuntary, and forms the basis of our survival instinct, which evolved over millions of years. It helps us cope with the dizzying complexity of the thousands of decisions we make every day.
System Two is logical, conscious, and deliberate. While it requires more effort, System Two thinking allows us to use prior experience, data, and insights to reason through key decisions.
The availability of System One and System Two thinking to humans separates us from lesser species.
Like individuals, teams also need to utilize both System One and System Two thinking.
In business, we have to make day-to-day decisions efficiently. So we establish values, rules, and processes that provide guardrails when we need to make choices.
But other decisions require data, discussion, debate, and consideration. Strategic decisions, for example, like when and how to enter a new market, how to structure the product roadmap, and when to raise money.
To make space for teams to handle both types of thinking, companies often adopt operating rhythms.
An operating rhythm is like a company’s heartbeat; the cadence by which teams organize, interact, and collaborate to solve problems.
Operating rhythms create stability for employees, provide decision-making frameworks, and reinforce good collaboration and communication habits.
There are many methodologies you can choose from to implement an operating cadence, such as:
I recently interviewed Pendo’s founder and CEO, Todd Olson, for Churnkey’s Subscription Heroes podcast, and he reinforced the importance of cadence in his business:
“I love cadence… It doesn’t actually matter what framework you use. I don’t care. I don’t necessarily advocate for any particular one. To have a framework and follow it, that level of discipline is super, super healthy.”
Which operating framework you use matters less than the fact that you have one and follow it.
Cadences structure communication and collaboration routines; how, when, and on which topics people will work together. They are often implemented as a series of meetings.
In Patrick Lencioni’s book, The Advantage, he defines four types of meetings that are part of a typical operating rhythm (you may recall seeing the same image in last week’s newsletter):
The Four Meetings - Patrick Lencioni, The Advantage
The idea is to have a predefined set of meetings where you can count on having the right people in the room and in the right frame of mind for the task at hand.
I like to think of these meeting as containers. Each container is a placeholder for a certain topics requiring either System One or System Two thinking.
Through the normal course of business, you collect and prioritize agenda items and put them into the proper containers.
Daily Check-ins and Weekly Tactical meetings are all about System One thinking. Moving fast, handling problems in real time, and staying connected as a team.
Inevitably, strategic issues will surface in these tactical forums. Rather than solve by shooting from the hip, teams are usually better served by identifying the next appropriate System Two container to put them in.
It’s intentional procrastination, giving everyone time to prepare thoughts and gather necessary data to have rich discussion and make informed decisions.
Tactical containers need not be limited to management teams. You can also use them as cross-functional working teams at any level of the organization.
In a prior company, we held weekly tactical meetings around areas where siloed behavior is especially dangerous, e.g., go-to-market, customer experience, and short-term cross-functional projects.
On the other hand, Monthly Strategic and Quarterly Offsite meetings are for System Two thinking. Instead of focusing on day-to-day issues, these forums allow time and space to tackle more complex issues that impact the direction of the business. Think about examples such as organization structure, sales strategies, and product direction.
I know what you’re thinking, ”This guy LOVES meetings.”
Well, no, I actually don’t.
But in our line of work (most of you, I assume, are working in subscription-based tech businesses), collaboration is tantamount to success. Especially with distributed, remote teams.
As Olson explained later in our podcast, “With a cadence in place, there should be little need for one-off meetings. Something in the cadence will accommodate anything that arises.”
Leaders who are able to rally their teams around an operating rhythm have an advantage. They always have a time and place to reinforce their vision, adjust strategy to changing business conditions, and increase productivity by reducing the need for one-off meetings.
For some reason there’s one episode of The Jetsons that I've always remembered, “Rip-off Rosie.”
Rosie, the Jetsons' robotic housemaid, eats a faulty lug nut which makes her programming go haywire (perhaps the first AI hallucination on record?). She starts stealing things so that she can put them in their appropriate place while constantly repeating:
“A place for everything, and everything in its place!”
“A place for everything, and everything in its place!”
“A place for everything, and everything in its place!”
Season 2, episode 23, "Rip-off Rosie" (1985)
Yes, I realize I'm dating myself..
Do you have a place for any issue that could arise for your company or team?
If not, perhaps you should consider installing an operating rhythm.
🤘
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