Book Summary – Iterate (Run a Fast, Flexible, Focused Management Team)

To direct employees and help them accomplish their goals, managers need a high-quality, up-to-date information system. However, most managers get little or no instruction on how to do their jobs and have to figure everything out for themselves. They often lack the needed resources and their superiors blame them for problems no one could have anticipated. Like most people, managers don’t like change, feel territorial and can become defensive when under pressure, which is almost all the time. Iterative management enables managers to direct their work effectively.

Iterative management calls for positive behavior based on specific management principles.

The thermostat demonstrates how iteration works. You set your home’s thermostat for the temperature you want. It sends a signal that tells your heater or air conditioner when to go on and off to maintain that temperature even as the outdoor temperature changes or your oven warms up your kitchen. Your thermostat-based heating and cooling system – an “output machine” – constantly iterates its functions based on numerous, changing inputs and on your directed input – the thermostat set point – to maintain the temperature you indicate. The thermostat provides the input – feedback – required to get the output you want. In this way, feedback is essential to iteration.

“There’s no way to produce iteration if, once resources are assigned, they can never be moved.”

This is how your organization should operate. As an executive, you shouldn’t simply create a plan everyone must follow. You don’t know what the future holds. Your organization should depend on iterative management with managers constantly monitoring its current reality and adjusting as required.

“There’s no reason to believe that iterative organizations are populated exclusively by very mature or otherwise magical people. Rather, they’re populated by ordinary people doing what ordinary people do.”

Your managers are your firm’s crucial feedback system. Your corporate goals are your thermostat setting; your people carry out the heating or cooling. In this metaphor, your management team constantly checks the temperature and instructs employees to fine-tune their work so your organization reaches its objectives. You monitor, calibrate and coordinate to keep everything working systematically and automatically.

“Get used to the idea that you’re going to be wrong – a lot. Whatever seemed like the next most logical step yesterday will seem like it was a mistake in light of the new information you have today.”

Many times, managers understand their role intuitively and act based on “shared basic assumptions.” These principles offer a guide to these managerial ideas:

  • Coordinate management – Managers running things based on their personal preferences leads to organizational chaos. In iteratively managed organizations, all managers work according to the same guidelines.
  • Focus on results – Results or outputs count most. If they are consistently inferior, the organization can’t endure. All management decisions must focus on maintaining quality results.
  • Use resources wisely– Coordinated, collective management drives the intelligent allocation of limited resources. Thanks to feedback from alert managers, the firm can make astute decisions on how to spend its resources.
  • Have your eyes on the future – Organizations must focus on the future. Managers analyze the present, step by step, to develop their most up-to-date understanding of what the future holds. They constantly adjust their actions accordingly.
  • Coordinate leaders and teams – Each manager has individual goals and targets, but never at the expense of the organization’s broad goals. Managers should coordinate their actions with their team’s actions.
  • Insist on real world data– No leader wants bad news. Ineffective leaders pressure messengers to deliver only good news. Iterative leaders understand that the sooner they receive bad news, the sooner they can make the adjustments to change the bad news to good.
  • Meet on a regular basis – Iteratively managed organizations achieve necessary coordination and collaboration through regular meetings.
  • Make quick decisions and carry them out in full– Smart decision-making depends on working with a brief synopsis of goals, current situations, problematic issues and suggestions for moving ahead.
  • Foster a self-sufficient front line – In any organization, the crucial action takes place in the front line. Managers must ensure that front-line workers have definite goals and the resources they need to do their jobs.

Iterative management uses five key management practices – each with its own core competencies – to turbocharge performance.

Managers are your firm’s primary feedback system. All managers must know iterative management’s “five key practices,” and their related core competencies. These interdependent practices turbocharge performance, increase flexibility and reduce on management stress:

One: “Output and status broadcasting” – Core competencies are summary conversations and dashboards.

Reliable information flow is crucial. In iterative organizations, managers communicate (broadcast) the most vital information, including the current status of their areas. They share in every direction. Managers use “verbalized summary outputs” (VSOs) – elevator pitches that focus on outputs. They display their VSO information graphically using the second competency, “pragmatic dashboards,” showing only one customized graph for each VSO. These tools prepare managers to ask iterative management’s pivotal question, “What should we do today in response to what we’ve just learned regarding tomorrow?”

Two: “Work PreView meetings” – Core competencies are holding consistent meetings, looking ahead, allocating resources and using structured reporting. 

Work PreView meetings give managers the latest information about what may take place in the near and long-term future, so they can allocate resources accordingly. Maintain consistent meetings by gathering at a set time, having team members stand in for anyone absent and using an agenda. Consider what the team will do next, not what it just did. Budget decisions are ongoing. Make a report on each concern in four steps: “Objective, Status, Issue and Recommendation” (OSIR) – outline a goal, a prognosis, the cause of concern and the proposed action.

Three: “Group decision-making” – Core competencies are consulting, sharing decisions, implementing tasks and managing meetings.

Teams make decisions as a group using essential, intelligent trade-offs. Group decision-making relies on four core competencies: internal team consultations, unified decision-making, full implementation and well-managed meetings. Groups consult to formulate what to do and by what process. They make decisions based on why they are taking action. Everyone discusses the pros and cons, but all must abide by the decision. In decision-making meetings, teams should follow an agenda, encourage participation, use an established fact-based process and keep effective records.

Four: “Linked teams” – Core competencies are shared success, managers as conduits, team interdependency and lateral personnel training.

Organizations are made up of teams, not individuals. Firms need connected, cross-functional teams that share the pursuit of their goals. Managers link teams to the organization and to each other, as teams grow into mutual dependence. Over time, managers help team members learn to stand in for them and for each other. This iterative strategy works well in matrix settings using cross-functional management.

Five: “Front line self-sufficiency” – Core competencies are clear goals, accountability, resource control and fair workload predictions.

Front-line employees and teams should manage themselves. They should set defined goals, track their progress with “self-managed feedback” – such as a task check-off system, and manage their own resources. Front-line employees should create predictive “Fair Day’s-Work Forecasts,” based on knowledge of their workload.

A boring routine is a good thing.

Iterative management works directly with the mechanics and daily processes of organizations, making incremental adaptations to allocate limited resources to meet corporate goals. Managing ongoing activities, though not exciting, is important.

“Each iteration may seem better or worse at the time, but the aggregate of all of them ultimately gets you where you’re going.”

Beware of three difficult-to-face management truths:

  1. Sometimes managers are wrong – Each step brings new information, which determines the next step. This leads to new decisions, which can easily be wrong. When things don’t work out, executives sometimes criticize the managers, but often managers can’t see what’s coming. All they can do is deal wisely with each new set of circumstances.
  2. Spend resources wisely – Managers can’t control clients, manufacturing, service providers, the market, corporate chieftains or the future. What they can control is resource allocation – personnel, funding and materials. That’s it.
  3. Success means doing well with limited resources – Managers must intelligently balance their resources against the opportunities they identify. Companies can’t invest in everything. Some projects get only limited resources, which are challenging, but still better than limiting your