Working in the world of startups, there’s no end of advice available to you.
The challenge is that so much of it is contradictory in many ways, and therefore serves to confuse many leaders.
Over a series of posts, I’ll explore some of the most common areas of confusion I come across, starting with the inputs v outputs debate.
This has to be one of my favourite examples of common advice where very experienced and successful leaders seem to take diametrically opposite sides of the argument.
In the red corner you have the outcomes team, where their general mantra is some version of Steve Jobs or Lee Iacocca’s ‘hire smart people then get out of their way.’
In the blue corner you have the inputs team, roughly summed up by the idea that if you focus on the process then the results will follow.
So who’s right? Let’s take a look at the overall arguments for & against each.
Outcomes:
| Pros | Cons |
| Supports autonomy & empowerment | Less scalable, shifts the burden to individuals |
| Moves away from KPIs for their own sake, focus on their outcomes | Reliant on hiring the right talent |
| Drives innovation & creativity | Can miss the qualitative ‘how’ which is important |
| Creates a results driven culture / no micromanagement | At worst can lead to bad behaviours (quote from Cool Runnings coach) |
Inputs:
| Pros | Cons |
| Repeatable and scalable | Micromanagement and obsession with activity over results |
| Less reliant on ‘unicorn’ talent | Removes innovation & creativity |
| Scientific approach to success / quicker to identify and fix issues | Removes the meaning/purpose behind knowledge work |
| Supports ‘the right way’ of achieving results which helps with alignment & behaviours | Encourages compliance versus ownership culture |
| More efficient – lends itself to a more factory style of running things | Danger of disruption by AI |
Outcomes: the ‘for’ argument examined
Underpinning the ‘focus on results’ camp are a few key beliefs…
- First is that those closest to the work are likely to know best how to achieve the results in an optimal way
- Secondly is that it attracts and rewards the best talent on the market with more meaningful and autonomous careers i.e. get the right people on the bus
- Third is that it creates a results driven culture with an ownership mindset which breeds creativity and innovation, and this leads to long-term competitive advantage
Let’s take a specific example of SDRs where these principles could be applied in contrast to the more typical approach taken with this function where it’s more common to be highly prescriptive and process oriented.
If you make SDRs outcomes driven, and tie more of their compensation to closed-won revenue, this would have the following effects…
They’d think more like AEs, considering the full sales cycle and focus only on accounts more likely to close, which should lead to greater efficiencies and ROI.
They would be free to explore new and creative ways to prospect, generally leaning into their particular strengths and interests to make the outreach more effective and authentic, and potentially getting ahead of the market by testing new and innovative approaches.
Why hire smart graduates and ambitious early-careerists then constraint them into a monotonous programme better suited to AI or even basic automation? This is a sure-fire way to lose your best talent who would be well positioned to progress through the organisation as they develop.
When it comes to assessing results, there’s nowhere to hide – they can’t blame the process or other areas that the business is responsible for – and as such they’re more likely to keep their eyes on the prize because there’s no room for excuses.
Sounds pretty compelling right?
Outcomes: exploring the ‘against’ argument
Now let’s flip the above scenario on its head…why isn’t it done more often?
One of the main reasons is that many SDRs are new not just to the role, but to the work place full stop. Without clear guidelines on how to approach the role, it’s hard for a large majority to succeed. This leads to very uneven results and high turnover, both of which are significant drags on efficiency and can be costly.
By letting newer SDRs work things out for themselves, it’s also very likely to take much longer for them to ramp and hit their stride (if they ever do).
There’s also an argument that the company is abrogating its responsibility to provide the right level of guidance and training, then blaming individuals for a lack of results.
Perhaps the most important aspect here is that the outcomes model is simply hard to replicate and scale, bringing with it a lack of predictability which is ill suited to SaaS businesses where we want to build ‘engines’ or ‘machines’ that drive repeatable, predictable and scalable growth.
Last but not least, an outcomes driven model can lead to unintended consequences. For example if they’re just trying to prospect as many accounts that are likely to close as possible, there’s a chance they won’t care if they’re ICP which can lead to bad fit customers or low value deals.
Inputs: the ‘for’ case explained
Moving onto the case for focussing on managing teams through inputs.
The key beliefs you need to have about this approach are:
- Outcomes can be deconstructed into the causal behaviours and processes that lead to the same outcomes more often than not
- Focussing on inputs actually gives more control to individuals and doesn’t punish them for extenuating circumstances outside of their control
- They provide a scalable blueprint that allows everyone to have a similar chance at success
Let’s examine how this holds up with the same SDR example.
10 recent graduates join a rapidly scaling SaaS business, and in this case rather than being given targets and left to figure it out, they’re given a clear set of actions and behaviours that, during the previous 6-12 months, were tightly correlated to success.
Of those 10, 6 will follow the process and get close to their numbers; and if not they can evidence to the business that they have applied themselves well and are therefore likely to succeed going forward long term; 2 will not believe in the process, get bored and find excuses to be doing other work. They won’t be close to target or demonstrate their aptitude, and exit. A final 2 will exceed by quickly learning the process and applying it, but then adapt certain areas of that process where it can be improved. They will exceed their numbers and be earmarked for rapid progression.
On balance, you have a team hitting 100% of the team-wide goals; whereas if you took a similar situation and didn’t focus on the inputs it’s more likely that less than half would learn how to swim and the company would be adrift of its numbers.
Not only that, but those 8 will rapidly gain confidence through seeing early success; and they’ll have had a strong sense of always working on the specific inputs within their locus of control, which also breeds confidence.
Inputs: Exploring the case against
The case against focusing on inputs stems from the typical constraints it imposes on creativity, innovation, and adaptability.
Firstly, by enforcing a rigid process and sticking to a particular set of actions, you might discourage your team from thinking out of the box or coming up with innovative solutions to problems. The focus is on following a predetermined path rather than exploring and discovering new routes to success.
This method can also result in an environment where employees merely comply rather than take ownership and responsibility. A workplace that leans heavily on inputs risks fostering a culture where employees feel they’re part of a factory line rather than a dynamic and agile organisation. This type of environment could lead to burnout, lack of motivation, and a high attrition rate.
Moreover, while focussing on inputs can be beneficial in jobs that are highly quantifiable and repetitive, it may not be as effective in roles that require a higher level of cognitive flexibility, strategic thinking, and creativity. When you’re working with a diverse team with varied skills and strengths, a one-size-fits-all approach can limit potential and stifle growth.
Ultimately, the danger is that inputs become goals in themselves and as per ‘Goodhart’s Law’ when a measure becomes a target, it ceases to be a good measure. In other words, if you pick a measure to assess people’s performance, then they find a way to game it.
Not only that, but they will lose an understanding of the ‘why’ behind the KPI in the first place, and simply look to optimise towards their metric. This can quickly lead to incoherent and even contradictory practices in your go-to-market teams.
Whilst it’s related to product development, I found this excerpt from Lenny’s Newsletter super interesting, relating to how Spotify build product:
“If you look at companies like Google, Facebook—things that are very aggregatory, very funnelly, very at-scale consumer products—they’re often very metrics-oriented. A team owns a number, and the goal is to do whatever they have to do to make that number go up. I think Tobi just does not agree with that philosophy of product development and thinks that you end up with a lot of micro-optimizations of local maxima that may say you drove that number up, but the product just doesn’t feel good anymore. The product doesn’t fit well together, and it feels like one part is pushing me in one direction and the other part in another. You can’t really explain why that is until you find out that there were two teams inside the company who had different metrics they were optimizing for. That’s when you realize why the product is so weird and incohesive.”
This is another reason against being too driven by inputs, as the same impact is seen on GTM teams.
The Balanced Approach: Combining the Best of Both Worlds
Here are three key principles you can use to find the right balance:
#1: Inputs/KPIs can’t be conflated with goals
By all means, build a culture of measurement and data-led insights. Track activities and inputs. Look for correlations between certain actions and the outcomes you want.
But don’t make those KPIs an end in themselves (i.e. turn them into goals); instead leave them as useful barometers – canaries in the mine so to speak – so that they can alert you to potential issues and director your attention, coaching and training to improve any areas of weakness.
#2: Experimentation & adaptation should be championed
Again, in a data-driven culture (a good thing), create the room for intentional tweaking of existing processes and best practices in order to continue driving innovation and staying ahead of rapidly moving changes in your market.
Don’t ask people to mindlessly comply with existing ways of working – particularly as you go up the chain of command – but even at a more junior level, build outlets that allow them to test and learn and report back on the insights they’re gleaning. This is a great way to couple inputs and outputs.
#3: Everyone needs to understand the ‘why’ and the ‘how’
Where you want to run a more measurable, input-driven motion it’s super important to articulate the ‘why’ behind those inputs i.e. what’s the end goal?
This way people can optimise for the real goal, and not just mindlessly try to hit KPIs without the intent behind them (e.g. making 100 dials to the talking clock to hit their dial number, versus making less dials but focussing on how to have meaningful conversations with ICPs)
And where you’re running a more outcome-focussed approach, also make sure everyone understands the importance of how they get there if it’s materially important to the business.
For example, hitting your revenue goal with low-fit/non-ICP customers won’t support long-term success.
Flexing at the right time
The reality is, both inputs and outcomes have their place and their value, and the key is in striking a balance. Rather than seeing these two models as mutually exclusive, successful organisations understand that a balance of both can lead to optimal results.
This balance, however, does not mean treating each model as equal at all times. It means understanding when to lean towards one or the other, and allowing the freedom to shift as necessary.
For instance, being more inputs leaning makes sense:
- for more junior/inexperienced employees,
- where you already have strong good measurement infrastructure in place,
- if you’re trying to run significantly larger teams where variance could be massive,
- and in mature areas where you’re trying to test and learn which activities lead to success so they can be turned into playbooks and best practices.
On the other hand, you’ll want to lean into outputs:
- with more senior employees;
- where there is significant complexity on what you’re trying to achieve (making it very hard to reduce the outcome down to inputs);
- where your data infrastructure is poor;
- and at the outset of new projects where you want to optimise for the successful outcomes, before you start to obsess over the efficiency of achieving them repeatedly.
Conclusion
The ideal is a culture where both inputs and outcomes are valued in the right contexts.
Inputs should be seen not as rigid rules to follow but as guardrails that can help lead to success (the map is not the territory).
Equally, outcomes should be appreciated not only for the end results they deliver but also for the innovative processes and learnings that led to them.
After all, working in the world of startups is all about breaking rules, pushing boundaries and constant evolution. It’s not about either/or. It’s about both/and.
Because in the end, it’s not about inputs or outcomes, it’s about growth, success and fulfilling your startup’s mission.