Intentional Leadership
Six Operating Modes Every Leader Should Know
“I have no idea what he is optimizing for”, said my wife in an exasperated tone to me while we were at Joshua Tree (which I highly recommend visiting) during the holiday break.
“What do you mean?” I replied
“This engineering manager I work with…I don’t know what drives his decisions. How do I find out what he is optimizing for?” she replied.
I thought for a second, and I said, “Most people, including leaders, optimize for preserving their jobs”.
Of all the leaders I have encountered in my career, including prior bosses, very few of them explicitly share with everyone what are they optimizing for? What is driving their decisions? Why are they making those choices in that moment? Many leaders, including seemingly successful ones, just stumble through leadership. They move from one project to another, one crisis to another, one performance review to another, never pausing to figure out what is affecting their decisions. And because they never sit down and intentionally decide what broad outcomes they are driving towards, they are unable to explain to their teams why certain decisions were made, which will erode trust.
So this post is about giving leaders a framework for setting their intentions. I will break down the different types of intentions a leader can set, when to set it, how to communicate your intentions with your team, and what the pros and cons of each intention are.
Optimizing for the job.
This is usually the default intention that is hard-wired into most employees, including leaders. When you don’t explicitly decide what drives your decisions, you are subconsciously optimizing for your job. This mostly means making your boss happy and, in some cases, making your boss’s boss happy. Making your boss happy means ensuring all your goals that are tied to their success are top of mind for you.
There are a few scenarios when you have to intentionally optimize for your job. First, during your first 90 days into a new job or a new role. It is extremely important to show real results in the first few months into a new job. Equally important in those initial months is to convert your boss from your manager to your cheerleader. So hitting your goals that will make them look good is pretty important.
The second scenario where you have to do this is when people (or teams, or leaders) have very low trust in you or your team. This could be due to various reasons. Multiple missed deadlines, customer escalations, poorly performing team members, etc. When you are dealing with low trust, you have to pivot back to operating like it’s your first 90 days. You figure out which projects, initiatives, or decisions will help you win back the lost trust. This is also the time to really put the pedal to the metal and push a little harder to see things over the line. Lastly, if your boss hands over some messy business (messy stakeholder conversations, layoffs, etc.) to you to deal with, say yes.
Before we get to the cons, let’s talk a little bit about how to message this to your team. If you are in the first 90-day period, it’s about explicitly communicating to your team what kind of changes you are looking to bring out, which projects are important to you, etc. Most people will be expecting a new leader to make some changes, so don’t hesitate to make deep changes in your first 90 days. You might not get another chance to make changes like that. If you are dealing with a low-trust scenario, communicate that plainly to your team as well. Some leaders shy away from explicitly sharing that message with their teams because they don’t want to demotivate their teams or introduce some weird fixation with perception in their teams. Well, guess what, teams already know. If a team is struggling, its team members are probably the first to notice the shift in perception. Explicitly telling them that there is a problem and also giving them a path out of it will focus your teams in the right direction. If you don’t tell them anything, they will make up their own stories and most likely start to devolve into conspiracy theories, which will bring morale down very quickly.
There is one big con to optimizing for your job. In making the right decision for your job, you might make the wrong decision for the company. Most bosses are rational, but if you encounter a terrible boss, there is a real chance that in making your manager happy, you will make a terrible business decision. The one easy way to hedge against that is to ask for feedback. Ask your peers, your mentors, heck, even your employees. Ask them to poke holes in the plan, and if you feel there are too many holes in the plan, bring it up to your manager. The good ones will take the feedback. The bad ones won’t, and then it’s up to you to decide if you want to disagree and commit or not. I am going to say something controversial now, so bear with me. If you believe that the role, company, team, and industry are something that will asymmetrically benefit you and your career in the long run, execute on your boss’s decision EVEN if it feels wrong to you in the moment.
If you believe you can accelerate your career trajectory in that company/role and/or if you believe success at this company will lead to higher value opportunities in other companies, AND if there are no legal or ethical downsides, execute the plan, even if it feels a bit wrong or uncomfortable in the moment. Also, if the plan doesn’t involve walking through a one-way door, which in reality are most decisions in companies, don’t overthink it, just execute.
Optimizing for speed.
Sometimes you have to optimize for speed. Speed of decision making, speed of execution, and everything in between. Basically, how to move from idea to working product in the hands of your customer as fast as possible. This mode of intentionality works when the goals and their outcomes are fairly clear. Put it another way: if you know for sure that delivering X feature will result in delivering Y outcomes (revenue, customer growth, <insert_tech_metrics_jargon>, etc.), it could be very beneficial to optimize for speed. So how does one go about optimizing for speed?
Remove management layers - People managers can be incredibly useful in some operating modes (discussed right after this), but if you are optimizing for speed of delivery, managers more often than not will come in the way. Consider this scenario: Team A has to modify Team B’s code base to develop and deliver their feature. Team A’s manager goes and talks to Team B’s manager. Team B’s manager grumbles and complains about how their roadmap is full (roadmaps are NEVER empty) and tells Team A’s manager that they can’t hit their timelines and asks them to come back in six months. It’s always six months! Team A’s manager escalates to Team B’s manager’s manager and convinces them that Team A’s project has the CTO’s blessing and is very critical to be developed and delivered on time. Team B’s manager’s boss asks Team B’s manager to ‘find’ a spot in the roadmap. Team B’s manager grumbles one more time and reluctantly finds a spot in the roadmap. Team A’s team leads coordinate with Team B’s team leads to make the necessary changes. By the time the feature gets shipped, Elon Musk has sent a manned spaceship to Mars.
Obviously, the above is a very extreme case, but it is very common for mid/large-sized companies to run into a version of this situation all the time. Now imagine Team A and Team B were managed by one manager. The entire back and forth from the example above would be reduced to a decision the singular manager can make in a second. It is not hyperbole to say that removing management layers will increase your decision-making speed by an order of magnitude or higher.
Remove team boundaries - For the longest time, I was firmly in the camp of leaders who believed that small, dedicated teams that focus on one thing and one thing only for an extended period of time are crucial to any organization’s success. This iron-clad belief was completely shattered by the COVID-19 recession and the fallout after that. Long-lived teams work only when you can afford them. If you are upside down financially, or your growth is sputtering, you don’t have the luxury to run multiple teams, give them separate charters, and hope one of them has outsized returns. At Kickstarter and now at Kajabi, I have adopted the mindset of flexible teams with goals that change quarterly. In the day and age where AI tools are dramatically accelerating the productivity of everyone, including an old-timer like me, the ramp-up time for an AI-enabled engineer to quickly understand a new code base is orders of magnitude lower than what it was before. At Kickstarter and at Kajabi, teams have flexible boundaries and goals that change every quarter. To be clear, the goals still ladder up to a vision, but teams are expected to work on whatever is the most important thing to focus on in that moment in time. One quarter could be focused on fixing user experience, the other could be focused on fixing infrastructure, etc. Lastly, this doesn’t need to be all or nothing. You could have X% of your org permanently dedicated to a specific area of the product (for example, infrastructure), as long as you know for SURE that the investment is necessary and will result in the right outcomes for your business.
Clear decision maker - Optimizing for speed only works when there is one decision maker. In most companies, it’s the CEO or someone in the executive team who has been appointed the main decision maker. This is sometimes hard for the org to swallow. Tech companies have been conditioned for a very long time to go bottoms up. That is, teams are given an abstract high-level problem, and teams will come back with projects to solve that abstract high-level problem. If you are going to optimize for speed, this is not going to work. Someone has to say, ‘Don’t think, do this.’ A great example is Steve Jobs, who asked his team to ditch the plastic on the original iPhone in favor of glass because plastic scratched easily. No debate, no discussion. He just ‘told’ the team to execute, which led to the development of Gorilla Glass.
Before I get into the cons of this operating mode, I do want to point out that you, as a leader, can pick and choose which of these operating modes you want the company to adopt. You don’t have to stick with one forever. Figure out what will help the business and pick the right operating mode to go with it. The most important thing is to share with your organization why you are making the decisions. Why did you choose that specific operating mode, and what kind of outcomes are you expecting out of it? Also important is to be honest with your team if your choices don’t pan out. Ok, with that out of the way, let’s get to the cons.
The biggest con of this operating mode, where the management layer is anemic and teams don’t get to focus on one product area, is career growth. One of the consequences of a flat organization is that the career ladder, especially for leadership roles, is very short. If there are only two managers in the entire org, you can’t artificially create a spot for a third one, which means anyone aspiring to become a manager has to be comfortable waiting for a spot to open up, or they end up leaving.
Additionally, in flat organizations, managers have a much wider span of control, which means they can’t pay attention to every single individual in their org. And that means that regular promotions become tricky. Managers won’t have the time to plan out a comprehensive career path for their employees. The burden is now on the employee to figure out how to find the right projects. The manager can certainly guide them, but they won’t be able to do what they would be able to do when their span of control was much smaller. To be honest, I am a big fan of letting employees chart and find their own destiny, but that’s just me.
Optimizing for scale
Or put in another way, “Let’s spend all the money we have and see what sticks”. Just kidding! Still recovering from the post-COVID financial slump. Great, I have already digressed. OK, let’s restart.
In this mode, you are optimizing to grow your organization to work on multiple focus areas with the goal (hope?) that you will uncover multiple new revenue channels, which will ultimately strengthen the company. For example, an enterprise company might invest in starting a consulting arm. A consumer company might invest in standing up a content marketing team, and so on. A great example of a company where this way of operating has paid off in spades is Amazon’s AWS business unit. AWS (Amazon Web Services) lost money for a decade before it became profitable. AWS represents 15% of Amazon’s revenue and about HALF of its profit. Amazon’s bold bet paid off in the long run. So how do you optimize for scale? A lot of what you are going to see is the inverse of what we covered in the previous section.
Small, long-lived teams - I first encountered this at Amazon. A small team that has a clear focus can change the game, provided they are given a long enough runway. Clear goals are critical for these teams. A lot of companies end up spinning up these teams when the money was flowing freely and never gave them clear goals or guidance on what success should look like. The mistake companies made (including many teams at Amazon) was to not scrutinize teams at the end of every year on their performance, including not asking the question, “Should this team exist next year?” Without clear goals and focus, you are just setting money on fire. However, when you do it right, small teams whose focus won’t change every quarter can make an insane amount of progress. In my career, I have seen teams that spun up new lines of business, closed the gap with the competition, paid down technical debt, opened up sales in new geographies, and many other things that significantly changed the trajectory of the company. One of the major cons of the flexible team model is that it prevents you from running long-running experiments. So if you have the money and you want to chart out a path to a blue ocean, you need the power of small, long-lived teams. BUT, with clear goals!
HR Machinery - If you have a flat organization, you don’t need a ton of HR machinery to keep it running. What I mean by HR machinery is: Career ladders, Role descriptions, Interview Guidelines, Manager Coaching, Performance Calibration, HR Business Partners to support managers, etc. However, when you are planning on rapidly adding new individual contributors and leaders to the mix, you need to have a cultural assimilation machine in place that will ensure the people you hire not just fit your culture but are actually furthering the culture and becoming evangelists. Netflix and Amazon are great examples of companies that doubled down on ensuring that everyone at the company is a culture add. This is one area where organizations can get carried away very quickly. If you have decided to scale up your HR machinery, do it methodically. And as the British say, to put a finer point on it, add HR machinery only after you feel sustained pain. If your managers are struggling to build happy, productive teams for an extended period of time, it is time to scale up the HR machinery.
Execution machinery - Large teams need tight process control. You need processes to measure the overall health of the organization, which at a minimum should involve an operations review (to ensure your systems are working well), a business review (to ensure the overall business is moving in the right direction), and a program review (to ensure the critical projects are green).
Before I get into the cons, I do want to point out the obvious. Scaling organizations is not for the faint of heart. It is expensive and messy. Every new leader you bring in will grind the working gears of the company, and in some cases, completely bring things to a halt. However, if your core business is humming and you have the cash to experiment, optimizing for scale for a period of time can result in step function changes. Netflix went from renting DVDs to making TV shows. Amazon went from selling books online to sending satellites to space. Microsoft went from selling office software to running a social media company. If you do it with discipline, scaling up could be extremely lucrative for the company, but it comes with a price.
And if you guessed ‘speed’, you would be accurate. The cost of scaling up is execution speed. Decisions take forever. Teams take forever to sort out conflicts. Managers take forever to get stuff out the door, poor performers linger forever, etc. Even an extremely disciplined company like Amazon cannot compete with a smaller team. A great example is Chewy. Chewy focused exclusively on e-commerce for pets and destroyed Amazon in a specific category. So if you are going to scale up, make sure the payoff is worth the speed you are going to give up.
Optimizing for stakeholders.
This is a sinister variation of optimizing for your job. Specifically, you are optimizing to make a specific group of internal stakeholders happy. Many managers do this to curry favor with stakeholders, executives, board members, etc. If it isn’t obvious, I highly recommend not using this operating mode at all. Yes, it could get you promoted and could get you the corner office you have been dreaming of, but it will almost always come at a high cost. You might aggravate your customers. You might cause revenues to dip. You might annoy and confuse your team, and the list goes on. A couple of managers I have had in the past have used this operating mode and positioned it as a strategic business move to the rest of their team and me, but every single one knew that they were doing it to make an internal stakeholder (or stakeholders) happy.
It is not lost on me that internal stakeholders can often determine your future at a company. Large companies are often political minefields where you might need to make a certain group of leaders or executives happy to earn the license to do the right thing for the company. I know that’s a bitter pill to swallow, but that’s the reality.
The right way to go about this is to educate your stakeholders on the potential impact of their decisions. 90% of the time, this solves the issue, and you can walk your misinformed stakeholders back from the precipice of their bad decision. However, in the other 10%, you have a choice. Either you disagree and commit once and hope your stakeholders learn their lesson after they see their decision crash and burn, or stick with your ideals and exit the company.
If you do find yourself in this situation, communicating this to your team is also very tricky. You can’t tell your team that the obviously bad decision is strategically good for the company. You also can’t tell your team person X is making you do this. What I have done in the past is to position these decisions as experiments. “Leadership has decided to do X, and we are going to try it out and see if Y happens,” or something to that effect. Keep in mind that you can’t keep using this excuse. Your teams will ultimately lose trust in you. To be clear, this is the least desirable mode to operate in, and if you find yourself here repeatedly, it’s a strong signal that either the company culture is broken or you need to find a different environment.
Optimize for competition.
It is very rare for a company to operate in an industry with very little competition. Even if you are the first mover in the space, at some point a smaller, faster company will build a competing product and sell it at a cheaper price point and start to pull customers away from you. If you are constantly losing customers to a competitor, it is time to rally the company around beating your competitor and regaining some or all of the lost ground.
This mode of operating almost always has to be combined with some version of optimizing for speed. You can’t catch up with your competition if you don’t introduce an element of speed and urgency in your organization. When you tell your team that you are going to optimize for beating the competition, you have to clearly explain a few things.
What does success look like? Optimizing for the competition is like a sprint, not a marathon. You need to set clear, measurable goals with specific timelines. Is success recapturing 10% market share within six months? Is it launching three features your competitor has before the end of the quarter? Is it matching their price point while maintaining margins? Without concrete success metrics, your team will burn out chasing an abstract enemy. More importantly, you need to define when you will stop optimizing for competition and switch to a different operating mode. This cannot be a permanent state.
What are we NOT going to do? When you optimize for competition, you are making a deliberate choice to ignore other things. Be explicit about what you are sacrificing. Are you going to delay that infrastructure project? Are you going to push back on customer feature requests that don’t directly address the competitive threat? Are you going to accept technical debt? Your team needs to know what they can safely deprioritize without getting in trouble later.
What is our unfair advantage? A great example of a company that successfully beat back its competition is AMD. For over a decade, Intel dominated the CPU market while AMD struggled in the background, losing money and market share. But in 2017, AMD launched its Ryzen processors built on a completely new Zen architecture. AMD’s unfair advantage was its willingness to completely redesign from scratch, while Intel kept iterating on old architectures. AMD also maintained motherboard compatibility across generations, while Intel forced customers to buy new motherboards with every upgrade. Within seven years, AMD went from irrelevance to capturing nearly 30% of the desktop market and overtaking Intel in datacenter revenue for the first time ever. AMD didn’t try to beat Intel at Intel’s game. They found their own game and played it better.
Before I get into the cons, I want to be clear about when NOT to use this mode. Don’t optimize for competition when you don’t actually understand why customers are leaving. Don’t optimize for competition when your competitor is simply better capitalized, and you’re going to lose a war of attrition. And definitely don’t optimize for competition when your real problem is that your product sucks or your customers don’t actually want what you’re selling. Fix your product first, then worry about the competition. Also, never forget that this operating mode is a sprint, not a marathon.
The biggest con of optimizing for competition is that you will lose sight of your customers. When you are laser-focused on what your competitor is doing, you stop listening to what your customers actually need. You start building features because your competitor has them, not because your customers want them. You start making pricing decisions based on undercutting your competitor, not based on the value you provide. You might win the battle against your competitor and still lose the war because your customers have moved on to something completely different. I have seen companies spend millions of dollars building features to match their competitors, only to realize their customers didn’t care about those features at all. They cared about something entirely different that neither company was paying attention to. So if you are going to optimize for competition, make sure you have someone on your team whose entire job is to keep reminding everyone what your customers actually want.
Optimize for reducing cost.
One of my all-time favorite movies is Goodfellas, and my all-time favorite line from the movie is when Henry Hill tells the audience, “Every once in a while, I’d have to take a beating. But by then, I didn’t care. The way I saw it, everybody takes a beating sometimes.” He is absolutely right. Everybody takes a beating sometimes, and companies are no different.
Companies are run by people, and people are flawed. Some more than others, but people (including me) make dumb choices all the time. Additionally, capital markets are completely unpredictable in the short-term (1-5 years) and may be somewhat predictable in the long run (5-10 years). If you combine flawed decisions made by flawed people with unpredictable markets, you get recessions and downturns, which require companies to make drastic changes, including cutting down their expenses. Sometimes companies have to do it to save themselves, other times their board forces them to make changes, but the bottom line is, at some point, companies will have to figure out how to cut costs. If you do end up needing to optimize for cost, this is the way to do it.
If you google how to cut costs at a company, every article will tell you to start with software subscriptions, professional services, travel expenses, etc. The reality is, none of these will meaningfully affect your bottom line. People are the largest expense for every company on the planet. Starting with anything else is just delaying the inevitable. Start with your personnel costs first. To be clear, I am not saying that tightening your subscriptions or travel costs is a bad idea. You should do that as well, but remember that savings will only come from cutting personnel costs. I know this sounds harsh, but it is the reality. So, figure out how much you want to save, start with a 10% cut, and work your way up from there. The key is to cut deep but do it once.
The key to landing this message with your team is to be honest about the financial reality your company is facing, BUT also show them a path out. Show them how the company will get out of the hole it is in and show them how you will restart growth. If you don’t give your team hope, you will most definitely start a downward spiral in your company where nobody is motivated to keep pushing and will most likely stick around until they find their next job and leave.
The cons of cutting costs are basically everything. Company morale takes a dive. Velocity slows down. Career development takes a backseat. The company loses its competitive edge. Depending on how deep the company cuts, it could affect the product roadmap, which could cause customers to leave. However, if you are intentional about this change and ensure this is a temporary blip in the company’s trajectory with a path to growth right around the corner, your company will bounce back.
Framework
Here is a reference framework that captures the core principles of the essay. Feel free to print it out and keep it handy!
OPERATING MODE: Optimize for Job
When to Use: First 90 days in new role; Low trust situation; Boss hands you messy business
How to Execute: Focus on goals tied to boss’s success; Deliver quick wins; Convert boss to cheerleader
How to Communicate: Be explicit about changes you’re making. If low trust, tell team plainly and give them path out.
Duration: 90 days - 6 months
Biggest Con: Might make wrong decision for company while making boss happy
OPERATING MODE: Optimize for Speed
When to Use: Clear goal with known outcome (X feature = Y result); Need fast execution; Certainty over experimentation
How to Execute: Remove management layers; Remove team boundaries (flexible teams); One clear decision maker (”Don’t think, do this”)
How to Communicate: Explain why this mode, what outcomes expected, be honest if it doesn’t work.
Duration: 3-9 months
Biggest Con: Career growth suffers (short ladder, wide span of control, employees must find their own path)
OPERATING MODE: Optimize for Scale
When to Use: Core business is strong; Have cash to experiment; Want new revenue channels
How to Execute: Small, long-lived teams with clear goals; Build HR machinery (after sustained pain); Build execution machinery (ops/business/program reviews); Annual team review: “Should this exist?”
How to Communicate: Show the vision. Explain the long-term bets you’re making.
Duration: 1-3+ years
Biggest Con: Execution speed tanks (decisions slow, conflicts drag, poor performers linger)
OPERATING MODE: Optimize for Stakeholders
When to Use: Political minefield; Need stakeholder buy-in to do right thing; WARNING: Avoid if possible
How to Execute: First: educate stakeholders (works 90%); If that fails: disagree & commit once OR exit; Position as “experiments” with team
How to Communicate: Can’t say decision is bad OR blame person X. Frame as “Leadership decided to try X to see if Y happens.” Can’t overuse this.
Duration: As short as possible
Biggest Con: This is least desirable mode. If repeated, culture is broken or you need to leave.
OPERATING MODE: Optimize for Competition
When to Use: Losing customers to specific competitor; Competitor has clear advantage; Need to regain ground
How to Execute: Combine with Speed mode; Set clear success metrics & timeline; Define what you WON’T do; Identify your unfair advantage
How to Communicate: Explain: What is success? What are we NOT doing? What’s our unfair advantage? When will we stop this mode?
Duration: 6-12 months (sprint, not marathon)
Biggest Con: Lose sight of customers (build what competitor has, not what customers want)
OPERATING MODE: Optimize for Reducing Cost
When to Use: Running out of money; Board demands cuts; Business fundamentals changed
How to Execute: Cut personnel costs first (biggest impact); Cut deep, do it ONCE; Also cut projects & vendors; Start with 10% and go up
How to Communicate: Be brutally honest about financial reality BUT show path forward. Give hope. Acknowledge survivors. Give permission to leave if they don’t believe.
Duration: 3-6 months max
Biggest Con: Everything (morale tanks, innovation stops, tech debt piles up, customers suffer, best people leave)
KEY PRINCIPLES:
You can switch modes as situations change
Some modes combine (Competition + Speed), others don’t (Speed + Scale)
Always communicate WHY you chose this mode
Be honest when your choice doesn’t work
Most modes are temporary except “Optimize for Job” (the default baseline)
Conclusion
So when my wife asked me how to figure out what her engineering manager was optimizing for, the real answer is simple: most leaders don’t know themselves. They stumble from decision to decision, crisis to crisis, never pausing to be intentional about what they’re trying to achieve. Their teams are left confused, trust erodes, and opportunities are missed.
But you don’t have to be most leaders.
Pick your operating mode based on what your situation demands. Communicate it clearly to your team so they understand why you’re making the choices you’re making. Execute with conviction. And when the situation changes, have the courage to switch modes and tell your team why.
That’s what separates intentional leaders from everyone else. Not that they always make the right call, but that they know what they’re optimizing for and can explain it. And when they get it wrong, they admit it and adjust.
Your team deserves that clarity. More importantly, you deserve the clarity that comes from knowing exactly what game you’re playing.
Until next time!
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Brilliant breakdown of the six modes. The part about removign management layers for speed is something I wish more orgs understood operationally instead of just saying it. When I've seen it done right, decisionsreally do speed up by like 10x, but nobody talks about the tradeoff with career ladders that can frustrate strong ICs looking to grow.