Outcome awarded $380,000 Vöxtur grant
The story behind Outcome
When Guðrún and I started sharing our experiences early in 2020, it was never with the intention of starting a company. First it was curiosity and the eagerness to learn. Then it became research as a side-project during evenings and weekends. Eventually, it became an obsession. We wanted to create something that could change the way millions of people work. So we quit our highly rewarding jobs to go on this adventure together.
This is the story behind Outcome.
Death by a thousand papercuts
This story starts at CCP Games in 2019. At the time, I had recently taken on a new role as the Director of Operations for EVE Online, which had around twenty cross-functional teams at the time. After spending months aligning with leaders and teams, we set out to clarify the purpose and ownership of our cross-functional teams. We were inspired by Marty Cagan’s famous post on Feature teams vs. Product teams, and the transformation from project-oriented funding to product-oriented funding of teams. In such a model, cross-functional teams are focused on and measured by outcomes (rather than output); and they are empowered to figure out the best way to solve the problems they’ve been asked to solve.
By the end of the year, the ball was moving. Our teams were starting to have explicitly defined purposes, customer segments, domains of responsibility, ownership of software components, measures of success, and more. We were eager to support the teams with the best possible operational environment. Our goal was to enable them to spend their energy on creating value for their customer (e.g. EVE players), not on tedious administrative tasks or navigating complexity within the organization. However, achieving this turned out to be easier said than done.
Essential team information was being stored in a scatter of tools, there was no real overview
Basic information on our teams, such as team members, who’s the team lead, which segment a team belonged to (i.e. department), links to roadmaps, and more were in Confluence (documentation tool). Domain boundaries of teams were being mapped free-form style in Miro (virtual whiteboard tool). Ownership of EVE software components was maintained without proper team support in Jira (issue tracking tool), and changes to ownership were managed informally through Slack (async communication tool). Upcoming team changes were being planned in a combination of Excel, Miro and Powerpoint without any connection between each other. The list went on.
This was frustrating for everyone involved. The lack of transparency made it difficult for people to find relevant team information. There were conflicting views on team ownership. Whenever there were changes to teams, team leads had to spend too much time on administrative tasks to reflect those changes across the scatter of tools. It was hard to connect the dots across these tools. Things almost instantly became outdated.
There was no single-source-of-truth for our teams
I found myself spending my evenings updating team information manually to maintain consistency across those tools, and sending slack messages to team leads to get them to keep information up-to-date. It was exhausting. There had to be a better way.
By coincidence, I ran into Guðrún at a mutual friend's birthday party at the end of 2019. Guðrún and I both went to Reykjavik University and were part of the Mathematics undergraduate program together, so it was great catching up.
I knew Guðrún had been kicking ass at Tempo as a product manager and had notable experience in the B2B ecosystem of work and collaboration tools for tech companies. I shared my ongoing frustrations in building a strong operational environment around our cross-functional teams. I asked her how other tech companies at scale, that were transforming to empowered cross-functional teams, were solving these problems.
Guðrún’s response: “You’re doing it pretty much the same way as everyone else”
I thought she was joking at first before realizing she wasn’t. I was dumbfounded. We decided we would meet for a cup of coffee a few days later to share our experiences.
A cup of coffee turned into a 5 hour session
We met in downtown Reykjavik on an early Sunday morning in January 2020. Guðrún shared her story from Tempo. She had been working as a product manager for many years at the company and was currently the principal product manager for Timesheets, Tempo’s flagship product for time tracking. Guðrún and her team embraced every opportunity to experiment with new ways of working. Most recently, they had been the first team at Tempo to be primarily measured by outcomes, not outputs. They were experiencing many of the same problems I had described to her at the birthday party.
Being deep in the B2B ecosystem, she had talked to many leaders and teams in tech companies and participated in conferences, meetups and community discussions online.
It seemed like everyone was facing the same organizational problems when attempting to build empowered teams
Guðrún shared some of the patterns she had observed. Micromanagement and leaders feeling like they can’t trust teams to make important decisions. Approval loops on every project. Endless coordination meetings. Cross-team dependencies causing delays in delivering value. Constant reporting on features to senior stakeholders. Not enough time spent on tech debt. Team leads burning out.
I found these patterns both interesting and relatable. However, I couldn’t wrap my head around how exactly they connected to the challenges I was facing in building a strong operational environment around teams. Eventually we came to the conclusion that:
Most tools used by tech companies were not designed for the shift to empowered teams
When transforming to empower teams, the attention shifts away from individuals and projects towards ensuring that cross-functional teams have a clear purpose, ownership and measures of success within explicit boundaries. The problem we faced was that most tools used by tech companies are not designed for this shift. For example: Org charts describe the hierarchy of individuals and software development tools primarily focus on managing outputs such as tasks or projects. We needed more than our existing workarounds like Excel, Powerpoint, Google Docs, Confluence and Miro, to manually build our own team management systems. In those tools, essential team information remains scattered, hard to track, hard to update, and hard to access.
A simple coffee chat had turned into a five hour conversation. We realized there was a lot more to dig into. What does the literature tell us about successfully transforming in practice to empowered teams? What is the role of technology in it? We set out to spend a few weekends on researching this further. After all, it could notably help both of us in our roles at CCP and Tempo.
A year of research
Once we got going, a whole new world opened up to us. Each discovery sparked new questions. What we thought would keep us busy for a few weekends turned into a year long commitment of late nights and weekends spent on research and exploration.
We learned many things along the way, such as:
Team structures and software architecture are coupled in much more direct ways than we realized, i.e. conway’s law (link)
The transformation from project to product was ultimately about teams having end-to-end responsibility of value streams (link)
The traditional top-down, hierarchical operating model still in use in most companies today is a legacy from the management models popularized during the industrial revolution (link)
Organizations are complex adaptive systems like forests, cities, and ant colonies; Not complicated and predictable systems like airplanes and cars (link)
All cities seem to survive, while all companies die (link)
Simple rules, fractal structures and emergence is what unlocks scale in nature (link)
Progressive organizations operate as a decentralized network of empowered teams (link)
There exist companies, like the chinese manufacturer Haier, which has 70,000 people in over 4,000 teams without any middle managers (link)
Technology is a critical ingredient to enable self-organization and empowerment of teams (link)
Without strong support of senior leadership, transforming to empowered teams has a low chance of success (link)
We also shared knowledge with all kinds of people from tech companies such as Asana, Riot Games, Spotify, Unity, Google, and Facebook. We learned that once these companies grew beyond a certain scale, they started exploring and building custom solutions to promote effective collaboration for their teams. Investment into these solutions varied from hackathons to fully staffed teams or departments.
A few examples of the internal solutions we heard about:
Team management application to manage basic information about teams, which had a connection to their access management system and other systems in use, to automate administrative tasks
An app on top of a project management tool to help clarify ownership of features and systems across teams
Internal search engine for information across all work and collaboration tools (you can probably Google the company - pun intended)
A Slack channel where a support team took requests to find team information for people (basically, a human search engine)
Simple organization versioning system to keep track of changes in team structure over time
We had gone deep into the rabbit hole. Themes were emerging from all of this activity.
Growing pains that never go away
Once organizations start to scale they experience all kinds of organizational challenges. This is casually referred to and perceived as growing pains. The truth of the matter is that for most organizations these pains never go away. They are all symptoms of a deeper cause. Despite this, most organizations primarily focus on taking painkillers, and not changing their lifestyle. That is, they do not spend energy on fundamentally changing their ways of working once they scale.
Centralization is hard to scale, decentralization needs a system
The fundamental principles of scale that organizations can adhere to come from nature. What nature teaches us is that centralization is hard to scale. However, most organizations operate in an unnatural way through top-down command and control structure. The solution is decentralization of decision-making where empowered teams own end-to-end value streams within explicit boundaries. But there is a tradeoff. Operating in a decentralized way forces a much more cohesive design of a system for alignment, adaptability and transparency within the network of teams.
Technology is needed to close the operational gap
The operational gap around these new ways of working will primarily be solved through technology. However, current work and collaboration tools were not designed for the shift to empowered teams at scale. The time has come for a new generation of platforms to close this gap and thereby accelerate the adoption of more effective ways of working.
Time for a decision
This side project had taken on a life of its own. At this point, we were spending most of our spare time and brain space. We asked ourselves why we chose to spend all this time together.
Guðrún shared that her personal drive is to build great teams and help others do the same. People should love coming to work. It’s where we spend most of our waking hours during our careers. Being part of a great team creates motivation on another level. At the same time, when the environment around a team is toxic, everything becomes harder. More people deserve to be part of great teams.
Personally, I’m a fanatic systems thinker. My drive is to create highly valuable systems for people. I spent my masters studies focusing on model-based testing of software systems. Alongside friends, I’ve experimented with running myself as an organization (Vignir, Inc). While teaching at Reykjavik University, I crafted the largest design sprint experiment to date (link). Creating a strong operational environment around teams is where I’ve now found a meaningful home for my contributions.
We made the decision that we would quit our highly rewarding jobs and go off on the adventure
We combined Guðrún’s drive to help people be part of great teams to my drive to create highly valuable systems for people. Like peanut butter and jelly, a beautiful combo.
A mission is born
In the spring of 2021, we founded Outcome. The name of the company is a reference to the experiences that led to this journey and one of the underlying characteristics of our mission.
Our mission is to enable organizations to become better as they get bigger
Read more about our mission and approach in The birth of Outcome.
We are now going full steam ahead, ramping up our team and working on the first version of the Outcome team platform. Exciting times ahead!
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