I’m sure you’ve run into Simon Sinek’s TED talk on the Golden Circle, where he made a case for how great leaders communicate differently — leading first with their why (or purpose), then describing their how (or unique value proposition), and finally describing what they do.
I find the Golden Circle is just as applicable when deconstructing or charting a new idea or venture — mapping quite nicely to the vision, strategy, and product pyramid that you’ve probably also run into.
The mistake too many entrepreneurs make is rushing up this pyramid and prematurely falling in love with their product. This is the classic build-first or solution-first approach where the tendency is to lead with what you are building (product) instead of taking the requisite time needed first to get your vision (why) and strategy (how) in order.
Vision and strategy are foundational pieces without which even a good product cannot withstand the weight of its market.
The challenge, of course, is that vision, strategy, and product all have varying, and often fuzzy, time horizons — making it challenging to keep them aligned and actionable simultaneously.
In this post, I’ll outline a 3x3x3 perspective that we use at LEANSTACK to connect our vision, strategy, and product decisions.
First, get your why in order
“If you don’t know where you are going, any road will get you there.”
- Lewis Carroll, Adapted from Alice in Wonderland
A few years ago, I met a young startup team at an accelerator in Chile. A few months later, they were in a different accelerator in Denmark. And then I met them again, in yet another accelerator, in the U.S. That’s when I sat them down and advised them to seriously reconsider their approach. They clearly had no problem getting into accelerators, it was getting out that was the problem. They failed to raise any investment at any of the accelerators and weren’t pushing their idea forward. Accelerator-surfing as a strategy clearly wasn’t working, and the founders would be better served bootstrapping or pivoting/resetting their idea.
Most people don’t think hard enough about their “why” because it can be a deep and often uncomfortable exercise. But starting without a “why” is akin to taking a road trip without a ballpark destination in mind. While it can be exciting and adventurous at the outset, it can quickly devolve into aimless and painful wandering — especially if each founder has a different destination in mind.
When thinking about your why, it helps to deconstruct your goal into two parts: your purpose and your minimum success criteria. If you’re familiar with OKRs, you’ll see a nice parallel here. OKR stands for objectives and key results, and it’s a goal-setting framework, first developed at Intel, and now used at many companies, including Google, LinkedIn, and Uber.
It works by having you first outline your ambitious qualitative goal (objective) and then define your more specific quantitive metrics for measuring that goal (using key results).
Let’s see how you could apply this to your “why.”
Qualitative: Why do you exist?
To get at your purpose, first consider the following question:
“What other than money do you want to achieve with your project?”
Think about the customer segments you want to serve and why? What problems or jobs do you want to solve for them? Will solving these problems make a significant enough impact on their lives? What’s in it for you?
Quantitative: How will you measure this impact?
This is where things can quickly get fuzzy. Instead of trying to estimate the maximum upside potential of your idea (which is near-impossible to do accurately), focus instead on your minimum success criteria.
Your minimum success criteria is the smallest outcome that would deem your project a success 3 years from now.
Some examples:
- Sell 100,000 copies of a book in 3 years
- Achieve $10M revenue/year in 3 years
- Help start 1M startups in 3 years
If you have a vision past three years (which you should), focus on just the first three years. No one ever penalizes you for revising your goal upwards. It’s not having a goal that gets us into trouble.
I find three years to be the right length of time to get most ideas past product/market fit and into early scaling, which is about as far as we can meaningfully attempt to forecast. This is the first “3” in the 3x3x3 perspective.
I cover detailed steps for determining your minimum success criteria in my book: Scaling Lean. I’ve also written about it here.
Next, formulate possible hows for achieving your why
“The essence of strategy is choosing what not to do.”
- Michael Porter
With your ballpark destination defined, the next step is outlining a potentially viable roadmap for getting there. Too many entrepreneurs obsess over scaling risks from day one, which is misplaced prioritization and a top killer of startups (and innovation projects). While you should certainly sketch out an over-arching strategy for reaching your destination, you can’t afford to implement it all from day one.
A more effective approach is giving yourself permission to scale in stages — specifically 10X stages which is something I’ve also written about previously here.
A good roadmap should call out your significant milestone markers along the way. These not only help you chart your journey but also inform the strategies (hows) you might employ to get there.
Like your why, your hows also have qualitative, quantitative, and timeboxing components. I recommend timeboxing all your strategies to 90 days or three months, which is the maximum amount of time you give to drive a pivot (change course), persevere (double-down), or reset (kill the strategy) decision. This is the second “3” in the 3x3x3 perspective.
Example:
Qualitative: Achieve Problem Solution Fit
How: Use a mafia offer (problem/solution interviews)
Quantitative: Start 30/trials a month
Timebox: 3 months
Finally, test your hows iteratively
“If it disagrees with experiment, it’s wrong.”
- Richard Feynman
The Lean Startup shines at testing big ideas using small and fast additive experiments using the build-measure-learn loop. But simply running experiments is not enough.
It would be best if you prioritized your experiments based on where you are concerning your roadmap and continuously adjust your experiments based on the learning feedback loop from your experiments and metrics.
For this reason, we only sketch high-level validation plan briefs at the outset for our 3-month strategies and leave the actual details to reveal themselves during our 3-week lean sprint iterations. Yes, this is the final “3” in the 3x3x3 perspective.
Why three weeks? Coming from an agile/scrum background, we were already running 2-week build sprints. We added an extra week for measure and learn, which we found fairly easy to incorporate without too much additional overhead.
Check out this post if you’d like to learn more about the mechanics of running LEAN Sprints.
The 3x3x3 perspective
The visual below summarizes the 3x3x3 perspective and some of the tools and artifacts we use.
It’s important to highlight that the journey up the pyramid is never a straight shot but one that is riddled with several scouting probes up and down the pyramid that inform your vision, strategy, and product that are tightly intertwined.
I emphasize timeboxing so much because time is our scarcest resource. Unlike other types of resources, time only moves in one direction.
So when baselining your own progress story, consider these three perspectives:
- What is your 3-year ballpark goal — purpose and minimum success criteria?
- What is your 3-month goal, and how do you envision getting there — validation plan and strategy?
- What will you do in the next three weeks to test your strategies — experiment and lean sprints?
Now for the scary visual
Visualizing this journey in units of sprints, we get this:
You only have ~48 sprints to go from idea to early scale, which goes by much quicker than you expect. So make sure you make each one count.
