Avoiding Organisational Hubris

(nothing at all to do with engineering hiring, I promise)

The Cloud

There’s an old idiom, “every cloud has a silver lining”. And a newer one: “never waste a crisis”. Both teach the same lesson: that in failure, in destruction, in upheaval, lies opportunity. Opportunity to learn. Opportunity to rebuild differently, and better. Opportunity to move into spaces created (or vacated) as a result of the upheaval.

We’re pretty good at taking solace of the good that can come from misfortune, the strength that springs from weakness.

But what about the opposite?

The Legend of Icarus

In the old Greek legend, Icarus attempts to escape Crete by crossing the ocean on feathered wings, attached to his arms by wax. He is warned by his father: he must not fly too close to the sea, or the spray will weigh down the feathers and he will plunge to his death. But also: he must not fly too high or the sun will melt the wax, the feathers will come loose, and he will plunge to his death.

Flying feels pretty good. After a while, Icarus feels his confidence rise: he’s flying! And he’s going to make it! He soars through the air.

The sun does its work.

And he plunges to his death.

Beware Your Strength

The Ancient Greeks called it hubris: the overconfidence, the complacency, the dependency that comes with strength, and with success.

You should celebrate your success, and take advantage of your strength. But at the same time, treat your good fortune with caution and with suspicion lest it turn to hubris.

Every silver lining has its cloud.

Let’s get concrete. Below, I’ve detailed a few types of hubris that are particularly common in early and mid-stage organisations:

Dutch Disease

From Wikipedia:

“In economics, the Dutch disease is the apparent causal relationship between the increase in the economic development of a specific sector (for example natural resources) and a decline in other sectors (like the manufacturing sector or agriculture).”

Basically, if you’re too good at one thing (let’s say marketing) it will outcompete alternative uses of resources and effectively suck all the oxygen out of the room. Other functions (e.g. product) will atrophy and become weak and hollowed out. Later on, when you need them… they won’t be there.

Single Point of Failure

This is common when the organisation is blessed with a person (especially a founder) who possesses great strength in a given area (for example, business development). Because they are so good at that thing, their organisation will underinvest in building a scalable capability in that area. Then, when for whatever reason that person is no longer available to perform their function at the necessary scale (too busy raising capital, moved on from the organisation, simply too much work to do) there is nobody else who can pick up the slack.

This can also happen in technical areas if there is a very strong engineer who hoards all the architectural decision-making.

Easy Money

It’s pretty easy to raise money at the moment. And of course, having a lot of money in the bank can be a great source of strength. But it’s also an easy hand to mis-play, and a lot of damage can be done by having too much money. Here are a few examples:

  • Thinking that the raise is the goal rather than simply a funding source, and so underinvesting in sustainable growth.

  • Going on a mad hiring rush and lowering standards, eroding culture, adding bureaucracy and organisational debt.

  • Cultivating a dependency on paid customer acquisition with poor unit economics, which can’t be unwound without cratering growth metrics.

Resting on Your Laurels

A good product innovation will drive compounding growth for multiple years. As you watch those numbers march up and to the right with seemingly little effort on your part, it can be easy to think that it will continue forever. But remember: every exponential growth curve is just an incomplete S-curve. If you aren’t using the good times to build that next killer feature, growth will start slowing down and it will be too late to do anything about it.

Make Yaniv Happy!

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¡Gracias!

-Yaniv