Sabine's Principle of Cumulative Quality Advantage

Many organizations won’t survive the next decade. Of those that survive, even they are likely to be extinct before century’s end — especially the largest of contemporary organizations.

I was thinking today of a few essential adaptations that enterprises must make immediately in order to stave off their own almost-inevitable death.

With Regard to Business Strategy

Measure value delivered and make decisions empirically based on those data.
Strive toward a single profit-and-loss statement. Understand which value streams contribute to profit, yes, but minimize fine-grained inspection of cost.
Direct-to-consumer, small-batch delivery is winning. It will continue to win.

With Regard to People

Heed Conway’s Law. Understand that patterns of communication between workers directly effect the design and structure of their results. Organize staff flexibly and in a way which resembles future states or ‘desired next-states’ so those people produce the future or desired next-architectures. This implies that functional business units and structures based on shared services must be disassembled; instead, organize people around products and then finance the work as long-term initiatives instead of finite projects.
Distribute all decision-making to people closest to the market and assess their effectiveness by their results; ensure they interact directly with end users and measure (primarily) trailing indicators of value delivered. Influence decision-making with guiding principles, not policies.
The words ‘manager’ and ‘management’ are derogatory terms and not to be used anymore.
Teams are the performance unit, not individuals. Get over it.

With Regard to Technology

Technical excellence must be known by all to be the enabler of agility.
Technical excellence cannot be purchased — it is an aspect of organizational culture.

For example, in the realm of software delivery, extremely high levels of quality are found in organizations with the shortest median times-to-market and the most code deployments per minute. The topic of Continuous Delivery is so important currently because reports show a direct correlation between _(a) the frequency of deployment and _(b) quality.

That is, as teams learn to deploy more frequently, their time-to-market (lead time), recovery rates, and success rates all change for the better — dramatically!

I have a theory which is exemplified in the following graph.