Strategy is good, but constraint awareness is better

There is a really weird bifurcation in our industry when it comes to discussing constraints.

Be honest and mindful of your constraints and make choices that mitigate their impact

We either act like they don’t exist, like admitting them bestows some sort of profound shame, a taboo subject not to be broached… or we act like they are final, axiomatically insurmountable and their existence a good reason to not do something at all.

In my years as a banker, I was told many a time that an idea could not be implemented because ‘our systems can’t do it’. Duh. I know. The plan entails changing the systems to serve the business. Crazy notion, I know.

The systems we have don’t support the business we want. End of sentence. And end of conversation.

It sounds insane when you write it down like that and yet, it happened. It still happens. It is the way of the world. Why do you think I went into core banking in the first place? Decades of trauma.

Obviously the right answer to this dilemma is, “We are constrained by our current capabilities both in that we are running them and paying for them and in that they are not fit for purpose for what we want to do next, so we need a plan for managing this complexity: balancing the books, allocating talent appropriately, working out a timeline that is ambitious and realistic and ensuring we manage risk in the process.”

And once we’ve done all that, we switch off the old system rather than paying for it ad infinitum for ‘risk management purposes’. But that is a story for another time.

That’s bad enough. But the alternative is even worse. And it looks like this:

We know the founder of the business has the attention span of a newt, so we keep complexity off his plate, and if that means not doing necessary work, so be it.

We know a particular system is the CTO’s ‘baby’ from when he was a junior engineer so no matter how poorly it performs, we don’t talk about sunsetting it.

We know we don’t have the talent inside our organisation to understand the complex and shifting capabilities we are trying to leverage, so we hire a bunch of data scientists and we put them under an old-school project manager, or someone who considers database admin High Art.

We know our senior decision-makers don’t understand resilience on the cloud and have asked for 16 environments creating a cost profile for our project that is forbidding but it’s easier to just provision the bloody things than start from first principles (true story, by the way).

Need I go on?

OK, I will.

We have no product market fit in our early-stage start-up and the founding team won’t even contemplate a pivot or, God forbid, market validation because they have bought into the myth of the unwavering founder who doesn’t give in to the naysayers.

We have an unrealistic price point (it’s too low but we are going for growth and hope to make it or it’s too high but since one early customer paid for it… surely… surely there are more where this first sale came from).

We have a bunch of digital initiatives in our bank and pressure from clients to harmonise the price point for those with the market, but nobody wants to go to exco and say what we all know to be true: not all digital revenue is net new money. Some is money you used to make the old way just now it’s made the new way. And the margin may be lower but so is the cost (or it would be… if you hadn’t had turned those old systems off. Yeah, that one again. The story for another time). And the alternative was never to carry on as you were because it was rather comfortable. The alternative would have been losing the client to someone who moved faster to deliver robust and fairly priced digital services.

You catch my drift.

You can pay consulting firms millions for a strategy on the art of the possible or the trends that will define your vertical. You can have vision and clarity of purpose. Unless you are honest about your constraints, you are going nowhere.

And those constraints are very unglamorous:

• Money: how much do you have and what are you doing with it? Do you have enough money/time to do the thing you said you are doing? If not, you have a problem. Do you have focus on how you spend the money/time you have? You catch my drift.
• People: do they have the right attitude? Do they have the right aptitudes? Do they play nice together? If you ask a BA to write you a report on ChatGPT they will go down a rabbit hole of self-education for as long as you let them. If you ask someone who understands large language models, they will ask you a couple of questions about why you are asking and what you need to understand and brief you on the spot, as you are waiting for your turn in the cafeteria line.
• Leadership: do you have the stomach for the work ahead? Because it’s hard. And tiring. And uncomfortable. And often the obstacle may be you. Are you open to hearing that? And ready to do something about it?

I am not naïve. Everyone says yes when asked, with self-awareness being in extremely short supply in our industry. But the reality is there are only two paths to success: one is through being honest and mindful of your constraints and making choices that mitigate their impact, and the other is luck. Sheer, blind, stupid luck.

#LedaWrites

Leda Glyptis is FinTech Futures’ resident thought provocateur – she leads, writes on, lives and breathes transformation and digital disruption.

She is a recovering banker, lapsed academic and long-term resident of the banking ecosystem. She is chief client officer at 10x Future Technologies.

Leda is also a published author – her first book, Bankers Like Us: Dispatches from an Industry in Transition, is available to order here.

All opinions are her own. You can’t have them – but you are welcome to debate and comment!

Follow Leda on Twitter @LedaGlyptis and LinkedIn.