scaling operations
TRANSCRIPT
SCALING OPERATIONS Upscale – February 2016
@norrisnode
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What is operations anyway?
In your words…
Everything that happens after a customer places an order
Making the founder's vision a reality
Everything not done by the engineering team/sales team/CEO
External operations is how we give the best possible physical product experience to our customers. Internal operations is
organising ourselves to best achieve that.
The day to day running of the business, balancing priorities to achieve short term and strategic business goals, and setting
foundations for sustainable growth.
Usually includes
Finance
HR/Talent
Customer service
Account management
Office/Facilities
BI/Analytics
Legal
Sometimes includes
Sales
Product
Marketing
Engineering
Investor relations
Delivery / returns
Purchasing
Is Operations similar to product management?
Analyse, define, launch and retire (products)
How about scaling?
Scaling can mean to increase in size
It can also mean to do so efficiently
Maybe this might be what we do?
CAPABILITY
i.e.
COMPETENCE x CAPACITY
What’s it like having 4 kids?
4 people = 6 relationships
6 people = 15 relationships
Organisational complexity is non-linear
8 people 28 relationships
50 people?
R=(N x (N-1))/2 R=(50 x 49)/2 1225
R for 10 to 150 people
INDIVIDUALS DON'T BUILD GREAT COMPANIES, TEAMS DO. “
Group formats change predictably with scale
From Hunting Party to City
Hunting Party
2-7 people
From Hunting Party to City
Village huts
8-40 people
From Hunting Party to City
Large village
50-250 people
From Hunting Party to City
A town
250+ people
From Hunting Party to City
A City
10s of thousands of people+
Dunbar’s number
Dunbar's number is a suggested cognitive limit to the number of people with whom
one can maintain stable social relationships.
These are relationships in which an individual knows who each person is and how each person relates to every other
person
150
Hierarchies can be slow Reducing complexity and
increasing speed requires small group
sizes with clear mandates
Amazon’s 2 pizza team rule
Small teams = ownership = speed = less fragility
Transferwise form teams around KPIs
Spotify’s tribes, chapters and guilds
Max 100 Max 100
Minimise people needed to complete a customer
task
Form teams around the customer, not the function
What are you optimising for?
Quality
Speed
Cost
Optimise for quality first
How?
Process is not a dirty word
Processes are like ratchets that secure quality
Principles and outcomes if stated clearly can reduce the need for detailed processes
Processes are best written by the people doing the work
Process name NameOwner NameLast updated DateWhy Why is this policy or process needed?
Give context and background informationWords Define any relevant vocabularyPolicies or principles
State any policies or principles relevant to this process
Process Describe the process in numbered steps Measures State measures / KPIs and reporting
frequency that will determine whether this process has been successfully followed
Organisational debt is normal. Be careful how
much you borrow.
Keeping up with growth, but only just
How we used to do
it
How we would do it to optimise for today’s volumes
What we will need to
do to optimise
for tomorrow’s
volumes
It’s your path to chart
WHENEVER THERE IS AN EXECUTION OF PURPOSE,
THERE MUST BE AN AGENT “
Adoniram Judson
Practice leads to theory
Theory is not superior to practice
Q & A