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How do you balance short-term commitments and long-term innovation with your product teams?

Satyajeet Salgar, Director of Product and UX, Google AI
Satyajeet has overseen product teams in places like YouTube and Google Search. He is one of the most impressive product leaders who has faced the challenges of investing long-term vs. executing short-term.

Satyajeet, how do you balance short-term commitments and long-term innovation with your product teams?

I love this question! I think this may be at the heart of great product management!

Balancing the short and long term is a challenge for any business and product team, and making the best decisions here can be the difference between success and failure for a company over the long term. There isn’t a perfect formula for this and so the details are what matter most, but there are a few things I keep in mind when thinking about these things for myself or when I advise other product leaders.

1. First, clearly understand your constraints as a business and product team:

Years ago when I was at a startup, there was a particular feature we said we absolutely would not build. Despite a competitor’s decision to build it, it wasn’t how we saw our long-term strategy and it wasn’t innovative. Until one fine day, I was asked to build it! One particular customer asked for it, and we would win that deal if we did and the CEO made the right call to commit to that and take this diversion away from our long-term vision. That was my top priority for a few months. We were a startup and needed to close that sale, and that short-term commitment was more important than anything else is our roadmap or any innovation I might have valued.

The pulse product leaders need to have across their business is to understand how much room there is to focus on long-term innovation, particularly if it has high business or technical risk within the company. They need to understand what the cost of giving up on or risking a short-term commitment is and what the role of research of innovation is at every stage of the company. This latitude is very different depending on the pressures on your company or your product. Understanding this allows you to do the next thing…

2. Staff and resource to match the innovation budget you have:

Once you have this understanding, the next step is to staff and resource your innovative bets. The 70-20-10 rubric is a popular way for large companies and teams still focussed on growth, but with a significant customer base to think about resourcing your initiatives.

You put 

  • 70% of your resources on the core business – making sure you deliver on your annual and quarterly goals
  • 20% of your resources on what you think your next business is – something that’s proven but may not be material today, but has a very high chance of being part of your 70% above in the next couple of years. It’s a bet on innovation, but a relatively safe one. 
  • 10% of your resources on crazy bets – there may be a small chance of success, but the upside if any of them work is huge and could transform your core business.  

Now keep in mind, these don’t need to be hard limits, but really function as a guideline. The exact mix for a company might be slightly different or could change over time. For example, I know places where they want to be aggressive and explicitly aim for 60-20-20 and others where they’re happy with a 90-10-0 approach. Each of these companies and/or teams have different philosophies on how to budget, but they are all thoughtful and explicit about them.  

In addition to the number of people, the key is really having the right people on these projects. Not everyone is comfortable, or can be successful on projects that are long-shot bets. These generally require risk-taking, comfort with extreme ambiguity, and frequent pivoting. I generally find people that are high performers in one set of projects e.g. people you trust to deliver on your core goals, aren’t always the best placed to drive your risky, innovative projects and vice-versa. While the attitude can certainly be coached, I recommend staffing these projects with people that are naturally drawn to these buckets.

3. Monitor and evaluate all the short-term and long-term projects:
I find where most people also struggle is maintaining the right mix over time and being able to treat the buckets of projects in the right way. You want to be disciplined and execution oriented on your short-term projects, and more exploratory and patient, but also dispassionate evaluators when it comes to your innovative projects.

I’ve seen too many 10%-type crazy bets continue well beyond the time that they should, because the teams start to run them like core projects, even though it may be clear the bet is either not working, or may simply not be as impactful as first imagined. The way to avoid this is to set up “kill criteria” even before the project starts, that let you know the idea isn’t working and be disciplined about following those criteria.

In fact, great product management practice involves both setting strategy and goals for each of these projects – clean metrics and dates they need to hit – and being clear up front on exit or graduation criteria. People and organizations have a natural inertia – good product practice prevents teams from being complacent and forces them to move on to the next innovation project and constantly get more efficient and reliable in delivering on short-term objectives.

4. Ensuring the culture is in place to allow and celebrate both big and small innovation

As Peter Drucker reminds us “Culture eats strategy for breakfast”, and so if there isn’t top-down support in the company and an understanding that building great products requires not just strong execution and delivering on the present, but continually learning and building for the future, the practices above aren’t sufficient.

Great company leadership deeply believes this set of values and communicates it often to their teams and makes decisions based on them. Specifically, it’s important to

  1. Celebrate small innovations in the core business – because those can often be the first steps in building the habits for more significant innovation later on, and can differentiate you in what really matters.
  2. Celebrate teams that learn and fail fast – showing everyone else that trying to innovate is valued and not a career risk.
  3. Create forums and cultures that constantly look at what’s happening in the industry and even related industries to see what’s coming around the corner, and educate all your teams on it. Great ideas come from everywhere, but they won’t come unless they’re seeded by the culture.

Finding this balance can be the difference between companies that are one-hit wonders vs. have enduring legacies. So make sure you get this mix right in your business!

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