Pretend it's a business

Photo by Aleksandar Pasaric.

Sometimes we write this newsletter and then weird bits and pieces show up other places. Like that time we wrote about party snakes and accidentally spiked a google search term.

For reasons we don't have access to, Ken Jennings was tweeting about liminal spaces last week. Was he digging through our back issues? Did he come across our newsletter about liminal spaces? Hard to say for certain. But, like Ken, we find ourselves thinking about liminality all over again. Except this time, we're not so much in it, as emerging from it.

At several points over the past few years, we've talked about the idea that the floor is lava. That we hadn't yet hit a stable spot. Even when people were announcing return to office, it was quickly followed by return to hybrid. And then promptly followed by return to we'll-get-back-to-you-real-soon-kiss-cat-emoji.

None of it felt solid. Even the latest rev of hybrid has had serious final_v7 vibes. And in that squishy place, a bunch of things have been up for discussion. Where we work. When we work. How much work gets done. How many jobs we're juggling at one time.

A bunch of the things that drove our collective uncertainty are still true. There's still a pandemic. There's still high demand for talent, across the board. And, if anything, there's a bunch more uncertainty looming. Yet, faced with an extended stay in the squishy place, a lot of execs are opting out. They are making decisions with the information they've got. Trading liminal for solid ground anywhere they can find it. And, for a lot of workplaces, shit is about to get real.

Collision course

There's two macro-trends about to collide. On the one hand, we've got rapidly rising salaries. The competition for talent that was once geo-limited, isn't anymore. Which means Northern California salaries are finding their way to small towns all over the globe.

Also, we've got leaders stepping into geo-distributed bossing for the first time. Managing teams of people where they don't share many (any?) overlapping daylight hours. Many bosses can't answer pretty basic questions about what their teams are working on or how long things will take to complete.

We have a very expensive workforce and bosses who aren't sure what's getting done. Watch how quick every exec team on the planet starts talking about accountability.

Your departments of risk already know what comes next. The HR folks have been working on performance management. Likely some of that work started last year. But, while everything was still punctuated with question marks, they shelved it. When hiring is slow and turnover is expensive, rolling out the tools to ensure a productive workforce can wait. Besides, it would create a bunch of work for the managers who were already pretty taxed. At the time, extending some grace made sense.

That was last year. Now it's now.

And now is when the other department of risk, your finance team, has started sounding the alarm. Your staffing costs aren't keeping pace with the business. Lots of tech orgs hire ahead of revenue. That's sort of the whole premise of venture funding. But if you hire ahead of fundraising milestones and then fail to hit those milestones, you're in a bad spot.

Inflection points are noisy

Like any diagnosis, as soon as you hear it you start to see it everywhere.

Some companies are steering into that change by articulating their own clarity. We don't know about you, but Brian Chesky's twitter thread about what Airbnb means by hybrid has been lodged in our timelines for a week now.

Other companies are finding it bumpier. Last week Netflix laid off whole teams of people they'd just hired. And Shopify's stock has dropped so much (65%+ in the last 6 months) that they've had to restructure how their people get paid.

Hell, a year ago Peloton was the pandemic's golden company. And three months ago they laid off 2,800 employees and replaced their founder CEO. With Barry McCarthy. A former CFO. Whose opening email to the remaining Peloton team read, in part,

"We have to be willing to confront the world as it is, not as we want it to be if we’re going to be successful"

Well that's a hell of a sentence, Barry.

The world as it is

It's hazardous to predict things too precisely during an inflection point. So much is up in the air, it's hard to know where it will all land. But every inflection point also has a vibe. And the vibe of this inflection point is: expect to be confronted with the world as it is.

Even with the competition for talent as hot as it is, expect to see more layoffs in the next 6 months than at any time since the first months of the pandemic. For the folks that stick around, expect to see a renewed focus on spending, budgets, and headcount plans. Words like "performance management," "accountability," and "review" are going to start showing up more. In your emails. In your slack DMs from your own boss. And possibly in your 3 am anxiety dreams.

This does not sound like a great vibe, we know. But it doesn't actually have to be bad news. The process-intensive overcorrection will be a pain, but the underlying push is for clarity. For exiting the liminal place and getting something solid under our feet about what we're here to do and how well we're doing it. That clarity is really really good.

And while your organization grasps for some collective clarity, there's a huge opportunity to find some clarity of your own.

Coming out of the fog

The worst thing to be during an inflection point is surprised. When you're surprised by change you tend to resist it. Even when the old way wasn't viable, much less optimal. It was known. And from a place of surprise, lots of people imagine that the past knowns are safer than the future unknowns.

But it's not true. Staying in a spot that isn't working – for your organization, for your team, for you – isn't safety. When everyone's thrown into a liminal space together, we call it transition. But when you try to linger in the liminal space while everyone else is packing up and moving out, we don't call that safety. We call that denial.

So instead of surprise, we're gonna greet this inflection point with clarity. Clarity is one of our favourite management words in general, but it's particularly powerful during periods of intense change for two reasons. First, clarity is a gift. It is a point of stability for others when everything is in flux. And second, clarity is a tool. When everything is tossed in the air, folks with clarity tend to find that obstacles move out of their way more easily.

As for where you get this magical clarity stuff: you'll have to dig. Maybe it's in your job description. Maybe it's in your OKRs document. But more likely, you'll need to ask some pointed questions of your boss, and of yourself.

Why does your team exist? Forget goals for a second. Why do we pay you or your directs? And if we stopped paying them what would happen? And if you knocked it out of the park what would that mean? And if you don't know, and your boss doesn't know, who can we go get those answers from? And with those answers in hand, how does your current work map to what it ought to be? And what needs to happen next?

When you know what matters, it's like you can see the matrix. Headcount, performance management, fiscal controls – those become straightforward conversations instead of procedural violence. Either the org can get behind your clarity or it can't, but either way your next steps will be obvious.

Your next steps will be obvious. Doesn't that sound nice, for a change?

- Melissa and Johnathan