Outcomes vs Outputs – Interview with Barry O’Reilly; sought-after speaker, author and business advisor.

Managing Outcomes Vs. Outputs : more than just semantics

 

One of the most consistent observations we have made here at Just3Things when working with our clients is the exponential difference in organizational culture, productivity and effectiveness when leadership and teams manage to outcomes over outputs.  

 

We spoke to one of the leading experts in this field, Barry O’Reilly.   Barry is the author of recently released Unlearn: Let Go of Past Success to Achieve Extraordinary Results, and co-author of the international bestseller Lean Enterprise: How High Performance Organizations Innovate at Scale—included in the Eric Ries series, and a Harvard Business Review must read for CEOs and business leaders. 

 

He works with many of the world’s leading companies, from disruptive startups to Fortune 500 behemoths, to break the vicious cycles that spiral businesses toward death by enabling culture of experimentation and learning to unlock the insights required for better decision making, higher performance and results.

 

 

J3T: Hi Barry! Let’s start at the beginning – what is the difference between outcomes and outputs?

 

Barry: It feels deceptively simple but can make a huge impact on how you, your teams and organization perform. Outputs are what you expect to ‘produce’, the products, goods and services which result from an intervention where as Outcomes are quantifiable changes in behavior you will have caused due to the output you created (see below). 

 

 

Output  Outcome
Launch newsletter signup Capture contact information of 25% of site visitors 
Certify 50 scrum masters  Reduce user story cycle time by 50% 
Invest $1,000,000 in online marketing campaign  Increase user activation rate per application download from 20% to 50% 
Add feature for ‘$50 Gift For Friend Signups’ to our user product page Increase our user growth rate by 20% in the next three months
Deploy scripts to automate software release to cloud infrastructure Reduce lead times for software releases by 50% 

 

J3T: So why is it better for teams and organisations to define Outcomes?

 

Barry: an outcome is the level of performance or achievement that occurred because of the activity, product, good or service your organization provided—most specifically the change in customer behavior that occurred. Outcome measures are a better indicator of effectiveness than output measure, for example if you completed the activity on time, on budget and scope but no customers use your product would you consider the effort a success? Outcomes quantify and assess how the product or process you created enable customers achieve the impact they are aiming for. 

 

Spending the time to define outcomes is always trickier than defining output but gives lots of advantages, including:

 

  • Allowing teams to create a shared understanding of why they are working on an initiative and what success looks like – 
  • Open up options for how teams could achieve the outcome they are aiming for 
  • Increase the meaningfulness of work because teams can tie their efforts to results and gauge if they moving towards the desired outcome they seek (or not)
  • Creating more of an experimental approach – defining customer outcomes and asking teams to take responsibility at this level opens up the opportunities to experiment with outputs. Did X move the dial? No? In which case let’s try Y? 
  • Balancing the need for long term planning with a ‘test and learn’ approach. Most large enterprises are adopting agile or lean ways of working based on the promise of delivering better customer outcomes faster—yet the majority still measure output as success. It can be daunting for stakeholders who are used to annual planning cycles and predictive controls such as time, budget and scope to switch techniques to manage uncertainty. Defining outcomes help engage stakeholders in valuable dialogue on what behaviors they expect to see from customers as indicators of success over  planning every feature that they will release that year with little real insight and limited customer feedback of they are useful, valuable or even needed. Ask stakeholder what they expect customers to be doing different as a result of the output you create, then measuring and monitoring it can be a great way to help them get started. 
  • Not creating a culture of ‘busy fools’ – in many output driven organisations we see lots of activity and people working really hard, but without stopping to ascertain whether what they are doing (output) is creating any value for the customer or organisation (outcome) until the output is full complete. Our mission to be to learn as quickly and cheaply as possible if our effort is driving the results we’re aiming for.

 


J3T: Sounds great! So how do organisations start?

 

Barry: I encourage teams to think big but start small, and learn fast as they explore how to deploy an outcome-based approach to their portfolio of work. Don’t change everything all at once—start small, tiny in fact. Identify one product, or new feature or backlog item, start there by trying the following:

 

  • Keep asking ‘why are we doing X’ – for example why are we releasing this feature? What difference will it make and to whom? What change in customer behavior do we expect to see? 
  • Don’t get hung up searching for the one perfect metric or baseline data—start where you are and define what you customer behavior you would expect would be different if the output was available to the world, model and measure it
  • Try to measure rates and ratios over totals—iaming for a percentage increase is better than saying ‘we can’t define this outcome and so we will see if we can get five customers use it. Instead, say 60% of customers must use the feature to test is valuableness, and support an experimental approach’
  • Don’t forget that outputs can also be constraints to foster innovation – we typically think about outputs as control metric (e.g. deliver this project with $1,000 or release this feature by this date) which force feedback cycles to happen, and reflect on our results. Use output metrics as a forcing function for innovation within reason, for example an outcome a customer success team might be responsible for could be increasing customer retention by 20% in the next month. 

 

J3T: What do you see as the key challenges to organisations defining outcomes?

 

Barry: One of the biggest challenges is that people are so used to managing to deadlines, budget and scope they don’t know how to measure value in any other meaningful way. 

 

When I present the idea of looking at outcomes they can see the benefit but don’t know how to start writing outcome based measure of success—it is daunting.. 

 

Another barrier is trust between ‘business’ and technology stakeholders in organizations. Sometimes business partners can feel that you are trying to trick them, plus they to feel comfortable managing to output because it’s the way they have always managed initiatives. 

 

When people are time poor, the pressure is high and they have been sold new process as the way to succeed, their appetite to experiment is much lower. This is why thinking big but starting small is key, and showing people how the method works and could a better approach. The breakthrough comes by working learning and unlearning together. Review your existing initiative dashboards, notice if the measure all output or outcome based. Try to identify and introduce one new outcome based measure on your dashboard that you can use as a pilot for a new way of work—then scale from there.

 

What if the metric is lagging indicator?

 

When people start to embrace outcome-based methods they often use metics such as revenue, profitability and customer satisfaction as a measure of success—but these are all lagging indicators. 

 

Businesses and teams need to think about how to also create leading indicators as the outcomes they are aiming for, and behavior they know mean the customers is on the path of success.

 

For example, at Netflix increasing revenue through customer retention of the service is a key outcome for the business. But if you’re working there waiting each month for customer retention results, and even colerating your work to such a top line metric as customer retention is challenging. That’s why creating leading indicators for the outcomes you aiming for is important and more actionable for the team. Therefore, if you’re working on the Search team at Netflix, and know retention is important you can ask a question such as, “what customer behavior in search would be a leading indicator for retention?” Maybe you’ll say the lead time from searching to starting a movie. You can then model and measure how quickly people can search for, discover and starting movie via your search functionality and see if that impact lagging indicators like retention rate of those customers. 

 

This takes work and skill but ideally you would look at a mix of leading and lagging indicators— need to be thoughtful and have checks and balances. But getting started is the first step, so start small and learn fast when works for your context. 

 

 

What other behaviours can stand in the way of teams focusing on outcomes?

 

Leaders struggling to devolve decision making – or on the flip side, teams being afraid to make decisions. 

 

The incentives in place in a business make a huge difference too – leaders can say that  the team should experiment, try out their ideas to succeed and work together toward outcomes but if leadership behavior shift when bonus are on the list, or paid individually on completion of projects on time, budget and scope this is totally mixed messages.

 

For me, the trick is to find  the cadence for your context; how do we get into the rhythm of making smaller more frequent bets and outcomes with leading indicators rather than creating big upfront plans with the output predicted in terms of time, budget and scope ? Every company has different requirements for different levels of fidelity of plans and some of this will also vary by stakeholder. 

 

Figure out how best your teams can keep stakeholders updated with the bets that they have made and whether this has moved the dial on the outcome metric you’ve agreed together matter. This is a very different way of working than planning everything out at the beginning of the year but the benfits you can realize in terms of organizational culture, productivity and effectiveness once you learn can be extraordinary. 

 

J3T: We hear a lot about psychological safety – how important is this?

 

The quality of safety in organisations is the quality of information you get. 

 

Ensuring that individuals and teams know how to design safe-to-fail bets is as important in them feeling they can learn from mistakes. How openly and honestly team can and are willing to share this learning so that others can jump up the learning curve more quickly an outcome every organization and leadership team to be aiming for, modeling and measure to achieve extraordinary results. 

 

You can think big, start small and learn fast tomorrow by asking your teams on a scale of 1-10, how safe do they feel to share open and honest information? Accept the score they give, and start small to improve. Ask what you can do as a leader to help improve that score by half a point. Pick one suggestion for a week, try it and learn fast what works and doesn’t. Role model your efforts to unlearn outdated behavior and thinking as you seek to create a create of experimentation and learning to help others succeed. 

 

 

To learn more about Barry you can;

 

Read Barry’s blog at: www.barryoreilly.com

See what he has to say on Twitter: @barryoreilly

Subscribe to Barry’s podcast at: www.barryoreilly.com/podcast

Join Barry’s newsletter at: www.barryoreilly.com/newsletter

UX Designer

Location: Bristol


Who are we?

Just3Things is a software platform which helps organisations of all sizes to adapt quickly, collaborate effectively and deliver more. Born of the realisation that while over 80% of C-suite executives* recognise that they need to restructure their organisations to be more agile and responsive, very few of them know how or where to start; J3T builds technology to facilitate cross-functional team working and alignment of goals across every function and level of the company. We are passionate about building transparency into organisations to foster inclusive and empowered networks of teams, and believe in the power of prioritisation to drive measurable outcomes across companies. Just3Things was built and deployed from OVO Energy, one of the fastest growth businesses in Europe, and recently valued as a UK ‘Unicorn’. Therefore whilst the J3T company was only formed in 2018, the platform is established with a successful track record.

We now have over 5,000 users with a commitment from current clients to roll out to 10,000 more in 2019 and a healthy pipeline of new business. The key challenge for our platform is engagement of the end user – the problem space is easily understood and appreciated by the buyer but the platform is only as good as the data entered; appealing to the end user is key. Therefore user research to improve core journeys, feature sets, and simplicity of use are fundamental.

We have a team of five experienced and senior engineers who have developed a highly functioning culture based on lean principles and user focus. The team is headed up by a CPO with a wealth of experience in building b2b SaaS platforms.

*Deloitte Human Capital Survey 2017

What can I expect to do?

You will be the UX and design expert in the J3T product team, utilizing your full range of user experience, product design, interaction design, and visual design skills:

  • Partner with engineering, product and commercial teammates to become an expert of the product and find elegant and practical design solutions within an iterative, transparent and feedback driven process.
  • Let the users lead your decisions – you will be highly customer centric, engaging regularly with the users of Just3Things. You should be curious and thoughtful about users’ needs and constantly look for user validation either through hands-on research, or by designing an experiment to test ideas and hypotheses.
  • Know when to optimize for quick-and-dirty, versus painstakingly delightful. Support the team in delivering their efforts into the hands of our customers.
  • Be a master at communicating your solutions, and the thinking behind them, in and outside of your team.
  • Bring your own vision for Just3Things design approach and standards and champion innovative and user-centric ways of working.

What would make me successful in this role?

  • Experience as a UX/UI designer ideally within a B2B environment, within enterprise software or SaaS products.
  • The ability to synthesise data and research to create user flows, wireframes, information architecture and polished UI screens. You are well versed in data-driven experimentation and validation.
  • Highly product focused, user centric, analytical, process driven.
  • Confident communication skills that empower you to present to stakeholders and articulate complex ideas and design decisions.
  • Knowledge of how to receive and deliver direct and supportive feedback, and work well in an agile team respecting each member of the team and their skills, experience and perspective.
  • Solid understand of web frameworks, design systems and how to define design specs, and have deep knowledge of design tools such as Invision, Zeplin, Sketch, Framer and Marvel
  • You’ve shipped many mature products and have a strong portfolio to demonstrate your impact as a designer which you can share with us online or via PDF.
  • You have are customer focussed, able to see things through the eyes of our customers.

What are the challenges?

  • This is an established and proven product built in lean style to support OVO Energy as it scaled to 1,500 employees. There have already been pivots, name changes and yet there is so much more that is possible for Just3Things as we grow rapidly in the market. You’ll need to be able to respect and build on the history while also being a pioneer and carving a new path for the future.
  • As with any role within a fast-growing SaaS business you have to be able to flex to changing business priorities, so if you are adaptable and embrace change then you will thrive in this environment.
  • Our structure is relatively flat and non-hierarchical and egos don’t fly here so no job is too big or 
too small, we all get stuck in to make the business successful, so you’ll need to be happy to roll up 
your sleeves!

What’s in it for me?

  • Ability to have a real impact – we’re making it possible for organisations to truly realise their ideal of being agile, with adaptable empowered, purpose-driven teams. From start-up to corporate to bleeding-edge product-led organisations, you’ll go along the journey with all of them.
  • The opportunity and autonomy to reinvent, and change the course of a successful, mature product. To shape Just3Things’ future, and the future of our clients.
  • The strongest teams are diverse teams – unusually for a tech company our product and tech team is 50/50 female-male split, have a female leadership team and work tirelessly to create a safe-space for our team to thrive. With offices in beautiful Bristol and well-heeled, eclectic Kensington Church Street London as a creative we think you’ll enjoy the cultural vibe.
  • Opportunity to develop and grow – in such a fast growing business there’s a real opportunity for you to make your mark and try on different hats to build your experience. We value learners and recognise that people have passions both in and out of work so we embrace this and will support you as you reach for your career goals.

Interested? Apply now

Send your CV and application to hello@just3things.com

Just3Things offers you £100 off your booking for the L&D Influencers, Europe Conference

Join Kim Atherton, Chief People Officer from OVO Energy, as she discusses the challenges and opportunities presented by organisational transformations.  In an effort to bring more transparency across functions and ease the anxiety associated with any “re-org”, Kim actually built and implemented a new platform, Just3Things, to drive alignment and clarity of purpose.  She’ll be discussing OVO’s journey with Just3Things at this session.

 

For £100 off your booking, simply use the “FriendofKim100′ promo code and visit the website here.

Transforming Volkswagen Financial Services

Inspirational CIO, Christian Metzner, is transforming Volkswagen Financial Services to deliver better customer outcomes, faster

A couple of weeks ago I was lucky enough to be invited to join VWFS’s two day PI planning session, alongside SEACON organiser Barry Chandler. I found the sessions hugely inspiring – the team were hugely excited about working in new ways to deliver value to their customers faster, and Christian placed huge emphasis on the importance of culture in achieving these aims. Read Barry’s blog about the two days here… 

Click here to view the content

£50 off tickets to Europe’s leading conference on Enterprise Agility, SEACON

On Tuesday 12th November 2019, leaders and practitioners from across Europe are coming together in London to share best practice and actionable insight on organisational transformation, entrepreneurial leadership and design thinking. 

 

With fantastic speakers including the CIO of Volkswagen Financial Services, Christian Metzner,  Deloitte’s Head of Enterprise Agility, Jon Smart, and Adventures with Agile’s founder, Simon Powers, it is going to be a really interesting day. Just3Things CEO and Co-Founder Kim Atherton will be joined by OVO Energy’s CTO, Ed Conolly, to talk candidly about the highs, lows and moments of near tears associated with implementing a network of customer journey teams whilst scaling one of the UKs fastest growth unicorn companies. 

 

Just3Things are offering £50 off tickets – please use the link below to book yours and we would love to see you there!

 

https://www.eventbrite.co.uk/e/seacon-2019-the-study-of-enterprise-agility-conference-tickets-52387178461?discount=J3T@SEACONUK.COM

 

Missed our webinar? “Turning the Tanker”

Organisational transformation programmes in the financial services industry

 


Sandy Scales
Head of Agile Adoption
Royal London

Aaron Clift 
Head Of Digital Strategy, Portfolio and Innovation
Royal Bank of Scotland

Kim Atherton
Co-founder & CEO
Just3Things

Missed our webinar?

Not to worry! If you’re still interested in hearing from experts at Royal Bank of Scotland and Royal London about the realities of organisational transformation, you can access the recording now below.  Topics we tackled included getting employees “comfortable with the uncomfortable”, coaching leadership on how to “hold their nerve” in the face of setbacks, the road to building additional capacity as a business.
Give it a listen and drop us a line if you have any questions.

 

Want to download instead? Right click and press save here to download.

How do Co-Founders meet?

In the modern workplace, careers are not so straightforward. The Economist featured Kim & Erinn’s journey together in becoming Co-Founders of Just3Things (spoiler alert – like all successful relationships, it is all about having similar values).

Annual Planning in 2019: Dreaming Big and Building Consensus

As 2019 kicks off, many of us will sit optimistically in a conference room somewhere and dig into annual strategic planning for our team, our department or perhaps even our entire company.  It’s a time to place big bets for the coming year, and to anticipate and debate some of the challenges we are all experiencing in a business environment that seems to accelerate through increasing stages of flux and disruption with each passing quarter. Whether disruption in your sector takes the form of new digital platforms, direct-to-consumer upstarts or new regulatory changes, the one thing we can all agree on is that striking the balance between agility and stability is amongst the most important jobs leaders must undertake.

 

As a recent Harvard Business Review article rightly proclaims, businesses achieving this balance successfully recognise that in

“confronting disruptive change, the heart of the challenge is a human one. Leaders understand that they must allocate human and financial resources to new-growth efforts or face a future in which start-ups and other rivals overtake them. Yet they are often paralyzed by the status quo and disagreement about the future”.

(HBR, Nov-Dec 2018).

 

The first step towards resolving that inevitable disagreement, of course, is providing an appropriate venue for colleagues to present and challenge their various strategic goals and priorities. This is precisely the sort of collaborative and creative environment that Matt Pitt, Head of People Development at Veolia UK, was able to create one Friday in December, as he gathered his direct reports to start to shape a view of 2019 and beyond that was equal parts ambitious and executable.  In preparation for the one day offsite, Matt asked each participant to complete a “dream canvas”, using a popular format for documenting and analysing strategic missions:

 

Matt and his team were kind enough to invite Just3Things to listen in to their presentations and debates, as the various objectives and evaluation measures were actually captured on-the-fly inside the J3T platform.  This data capture allowed us to immediately visualise clear accountability for each deliverable and align the various goals to Matt’s overall vision. Each proposed metric for evaluating success was documented explicitly and was ready to track as soon as January 1 rolled around:

Goal data has been changed to ensure confidentiality of client.

 

Of course, once these goals, metrics and measures are re-visited in the post-holiday light, there will be adjustments made and new priorities may be set, but the fact that the initial targets that were agreed on the day are preserved and can be easily adjusted will certainly help re-align everyone for a fast start in January.

 

Undertaking the exercise of publicly declaring the alignment of your individual and team goals to the company’s overall strategy is essential, as it immediately reveals workstreams that may not be aligned to a key strategic pillar at all.  If those workstreams are still considered valuable, but aren’t underpinning the company’s “north star” vision in any way, further debate will need to take place to ensure everyone understands why that disparity exists.

 

Ultimately, a quick glance at Matt’s team’s dashboard will reveal that there is already a solid balance between innovation projects and incremental improvements to existing processes that will increase key measures like employee satisfaction:

Goal data has been changed to ensure confidentiality of client.

 

It was incredibly gratifying to see how comfortable Matt’s team were in openly anticipating challenges and setbacks to each individual’s proposed “dream” statements, and we hope that dialogue continues to shape adjustments to their top priorities over the course of 2019 and beyond.