Doing less with less
I was talking with a friend about how difficult it is to lead teams when the leadership team has chosen a path of “do more with less”. Why do so many companies turn to a “do more with less” strategy when faced with economic difficulties? Does it help? Are there other options? Let’s explore.
Strategy shifts at tech companies are influenced by trends in the broader economy. When the economic environment is exuberant, companies place more and riskier bets and staff up teams to move those bets forward. In this environment, using capital to accelerate growth is rewarded.
Inevitably we find ourselves in a correction phase where money is harder to raise and instead of focusing on growth at almost any cost, disciplined business fundamentals are what gets rewarded. In this phase, companies tend to seek fewer and less risky bets. We’re in such a cycle now and, as a result, we’re seeing companies adopt a “do more with less” approach across the tech industry. Those that staffed up an array of new bets have decided to cut those efforts and lay off staff.
As anyone that’s lived through a “reduction in force” knows, team sizes can be reduced from one day to the next. Such actions align to market incentives to reduce costs. The problem is that stopping the “bets” that are in play is often much more difficult. The same set of incentives that reward cost cutting make killing products, or even just removing features, seem risky and unappealing. Removing features creates an immediate risk, or even certainty, of losing customers and revenue. Faced with the economic pressure and this clear risk, the common result is to make the team smaller, but keep features and products as-is in order to appease customers and hang on to revenue.
For those inside the now smaller teams, it’s hard to understand what makes this more with less approach so compelling. They’re asked to cover more scope with fewer people and it seems obvious that this is a strategy that lacks coherence and isn’t going to lead to success. Most of the time, they’re right.
When can “do more with less” help? It can buy time. Given time, you can hope that external factors will shift, that you’ll unlock new revenue, or uncover new information that will allow you to resolve the team-too-small/too-much-work configuration. It’s attractive because it defers difficult to reverse product decisions and because the risks attached to it are hidden.
Things can run in a steady state while you stretch the team and maintain a status quo with customers. However, this is an inherently unstable configuration. Small issues can easily snowball. A problem with a part of the system where you’ve lost expertise, or a handful of issues arriving simultaneously can destroy the equilibrium. At best you have a feedback loop that causes more and longer delays. Left unchecked, the situation triggers customer churn and staff attrition.
Another way that more with less can help is to drive efficiency, but for this to work you need to be in a position to apply patience and spend time rather than being in a position looking for ways to buy time. Teams and products can get too large for their own good. They can suffer from inefficient communication and incidental complexity. Untangling the complexity that results from a combination of organic product growth and inefficient team communication is difficult. Faced with such a problem, one wishes for a “redo”. You say to yourself, “if we could just start again, we could make this all so much simpler”. Chasing after such a wish via a rewrite is very unlikely to deliver the desired outcome. However you can take a more incremental approach and break off parts of the system to simplify. Find seams in the architecture and use them to divide the system and the team. It won’t be a rapid change, but over time you can decompose and simplify so that you end up being able to sustain the product with a much smaller team.
So more with less can buy you time. That’s sometimes helpful, but it’s worth assessing the hidden risks it brings, how you’ll use the time, and how you’ll decide you’ve spent enough time. More with less can also be a useful approach when applied before you need it to reduce complexity and increase efficiency, but it requires time to achieve.
Seeing the limits of more with less, I hope leadership teams will spend more time evaluating a “less with less” strategy when faced with the pressures of an economic downturn. Less with less means narrowing your focus and cutting scope in concert with cutting costs and staff. In the short term it might mean losing out on customers and revenue. But it will put the team in a position to continue to innovate with sharper focus covering a smaller surface area. Instead of betting on maintaining a fragile status quo, you’re betting on concentrated effort leading to innovation that unlocks growth. And in that way, less is more.