While I appreciate the break-down and alternate ways to assess investments, it is not clear to me that multiple continuum dimensions makes financial modeling work easier. For most, “Maintenance” work may be sufficient and simpler.
Beyond Finance, I like thinking about work through different lenses. These are some great ideas. That said, we need to be careful not to over-analyze potential investments as the more we break things down the more brittle it will be when faced with continuous change and actuals.
For quick, evolving analysis I often prefer simpler categories like those derived from the Kano model (even without using surveys to identify them). Have you considered those as they do seem comparable to some you propose here?
I find Kano helpful, but (as one might expect from anything helpful) it leaves a considerable amount out. This isn't a bad thing, just something to consider. Kano, for example, doesn't really address the reactive/anticipatory angle which is helpful in describing a lot of maintenance work. It also doesn't cover the hops required to understand impact, which is important for preparing to make a "case" for something with a more abstract connection to sustainable revenue growth.
That said, Kano offers a clear classification of product features based on how they influence customer satisfaction. The dimensions I shared don't really get into that. It offers a thesis as to why some things are additive, multiplicative, exponential using a customer lens. Also important (though less applicable for internal products, and more operational focused things). I like how it addresses time—in that delighters can be become "performance" and "basic needs" over time.
For me, at least, I find using multiple models, multiple factors/dimensions, etc. most resilient and least brittle. In general I've found product work to have either an oversimplification problem or an overcomplication problem , so I'm a fan of anything that can help tease out the mess and preserve the true "complex" nature of the work.
I tend to also feel that financial model should be "dumb". It is product's work to create a model that better reflects the reality of product work, and not burden finance with trying to figure it out. Plus they have to work across a the whole org, which will influence their approach.
Love how you focus on the power of the words we use. Thanks for taking the time to share new words and their definitions. Changing our language changes how we think. And when we speak and wrote and think about these important concepts better we work better!
I really like the way you describe. One question though. As to "Mitigative ←→ Exponential", not to look like nitpicking, but I'm trying to dive into the difference between Multiplicative and Exponential. Mathematically speaking multiplicative _is_ exponential (i.e. geometric sequence), however, the description is different. Can you elaborate on this more?
I really like this article, especially the last diagram. While I don't fully agree with NOT including 'Add New Capabilities' at a significantly smaller scale on the right, at least it gives a visualization high-level stakeholders can probably understand. There's soooo much appetite in new capabilities and i know ultimately only data we can believe, yet such illustration can potentially bridge the gap (until we've got data).
I appreciate your drawing attention to the stigma and lack of recognition of maintenance and incremental improvements -- as well as the hype and funding towards new, short-term gains. I observe it in everyday life and I experience it at work.
Mik Kersten's flow framework I have found extremely useful to help make work visible to have good conversations about flow of features, defects, debts, risks. But it can also over simplify to your point, especially if used to set target allocations. You are on to something here! A good question for Mik!
On financial and accounting treatment having a CFO or finance deparment that gets it helps to decouple the accounting treatment from the investment and doing, which takes a lot of education on how software works (like the above gardening!). But the old factory model can still rear it's head just when you think you've made progress!
While I appreciate the break-down and alternate ways to assess investments, it is not clear to me that multiple continuum dimensions makes financial modeling work easier. For most, “Maintenance” work may be sufficient and simpler.
Beyond Finance, I like thinking about work through different lenses. These are some great ideas. That said, we need to be careful not to over-analyze potential investments as the more we break things down the more brittle it will be when faced with continuous change and actuals.
For quick, evolving analysis I often prefer simpler categories like those derived from the Kano model (even without using surveys to identify them). Have you considered those as they do seem comparable to some you propose here?
I find Kano helpful, but (as one might expect from anything helpful) it leaves a considerable amount out. This isn't a bad thing, just something to consider. Kano, for example, doesn't really address the reactive/anticipatory angle which is helpful in describing a lot of maintenance work. It also doesn't cover the hops required to understand impact, which is important for preparing to make a "case" for something with a more abstract connection to sustainable revenue growth.
That said, Kano offers a clear classification of product features based on how they influence customer satisfaction. The dimensions I shared don't really get into that. It offers a thesis as to why some things are additive, multiplicative, exponential using a customer lens. Also important (though less applicable for internal products, and more operational focused things). I like how it addresses time—in that delighters can be become "performance" and "basic needs" over time.
For me, at least, I find using multiple models, multiple factors/dimensions, etc. most resilient and least brittle. In general I've found product work to have either an oversimplification problem or an overcomplication problem , so I'm a fan of anything that can help tease out the mess and preserve the true "complex" nature of the work.
I tend to also feel that financial model should be "dumb". It is product's work to create a model that better reflects the reality of product work, and not burden finance with trying to figure it out. Plus they have to work across a the whole org, which will influence their approach.
I really admire how you shine a light on a topic. Thank you for proposing a different model for how work can be classified.
Love how you focus on the power of the words we use. Thanks for taking the time to share new words and their definitions. Changing our language changes how we think. And when we speak and wrote and think about these important concepts better we work better!
I really like the way you describe. One question though. As to "Mitigative ←→ Exponential", not to look like nitpicking, but I'm trying to dive into the difference between Multiplicative and Exponential. Mathematically speaking multiplicative _is_ exponential (i.e. geometric sequence), however, the description is different. Can you elaborate on this more?
I really like this article, especially the last diagram. While I don't fully agree with NOT including 'Add New Capabilities' at a significantly smaller scale on the right, at least it gives a visualization high-level stakeholders can probably understand. There's soooo much appetite in new capabilities and i know ultimately only data we can believe, yet such illustration can potentially bridge the gap (until we've got data).
Love the analogy to gardening! I've been using the same metaphor :-)
https://assaph.substack.com/p/going-in-depth-into-mental-models
I appreciate your drawing attention to the stigma and lack of recognition of maintenance and incremental improvements -- as well as the hype and funding towards new, short-term gains. I observe it in everyday life and I experience it at work.
This rings of The Innovation Delusion (http://leevinsel.com/the-innovation-delusion). Have you read it?
Great insights as always John!
Mik Kersten's flow framework I have found extremely useful to help make work visible to have good conversations about flow of features, defects, debts, risks. But it can also over simplify to your point, especially if used to set target allocations. You are on to something here! A good question for Mik!
On financial and accounting treatment having a CFO or finance deparment that gets it helps to decouple the accounting treatment from the investment and doing, which takes a lot of education on how software works (like the above gardening!). But the old factory model can still rear it's head just when you think you've made progress!