Better Agile Than Smart

Generals have long known that plans go out the window the moment the first shot is fired. Business plans go out the window when a site or service gets its first users-perhaps before. And yet businesses often stick to their plan when the real-world feedback has announced that it doesn’t work.

The essence of 21st century business is to understand your market sooner, adapt faster than your competitors. A business that is not built for agility is like dragster that is optimized for straight line speed but God help you when the road curves.

I would argue that one of the primary reasons that big packaged software companies have struggled so badly on the web is that they are structurally incapable of agility.

I was reminded of this truth over coffee this week by Greg Stern, a long-time friend and collaborator and one of the best product people in the business. We have worked together three times over the past twelve years. A lot of what I know — or think I know — about the Web, I have learned from Greg.

When we restarted AllBusiness seven years ago, we said that it was more important to be agile than to be smart. We built a CMS and site architecture that would permit us to react to what was really happening in the market rather than what we assumed would happen. Our strategy was to learn and change faster than anyone else.

Achieving true agility requires more than good intentions. It is the combination of management commitment, business design and systems architecture. Here are the building blocks of agility:

1. Trust behavior not opinions
2. Measure what matters
3. Drive innovation through metrics
4. Institutionalize agility
5. Push the pace of innovation

Agile companies learn to trust consumer behavior more than opnions, tests more than focus groups. At its heart, a healthy company is like a science class. There’s a hypothesis, a experimental plan, the test itself, and an honest analysis.

Companies become what they measure. On the Web, we can measure too much. We need to build dashboards that isolate the most important variables — the behaviors that make a difference, Think about the dashboard of a car. After one hundred years, it’s beautifully optimized the most important things (speedometer, gas, etc) get the biggest dials. Things that matter less often (battery, temperature) get smaller gauges or idiot lights. Your business needs a similar dashboard. Building this dashboard enables you to focus your effort and investment on the things that will help your business most.

My first three points are about how you learn. My last two are about putting that learning into action. It does no good to have brilliant customer insights if you have no ability to act on those insights. It is central to this process of metrics-driven innovation that you have the ability to change your business’s behavior based on the the learnings.

Finally, it’s critical to act with a sense of urgency. The ability to learn, adapt and improve faster than your competitors is in and of itself a source of competitive advantage. To succeed, you must put agility at the core of your company’s values.

Peter Horan is the executive chairman of Halogen Media and a longtime digital media executive. Follow him on Twitter at @peterchoran. He previously wrote for Digiday about the demise of great brands.