Navigating the Stages of Hyper-growth

I joined Skyscanner in 2009. At the time the team was less than 30 people working on the flights meta-search product that had just enough Product-Market-Fit. Following continuous year-on-year double-digit growth in both users and revenue; reaching 60 million travellers, using 30 languages and who were booking 2 million flights, every month; and growing a team of 900+ across 10 offices worldwide — Skyscanner was acquired by CTrip in November 2016 for £1.4 Billion ($1.74 Billion).

In late 2017, I was asked to speak at a knowledge sharing forum for ambitious start-ups in Scotland, giving them insights into what it was like to experience that level of hyper-growth seen at Skyscanner. The topic in question was around navigating the stages that organisations go through as they grow. This is a summary of that talk. The slides are also available on Slideshare.

Navigating the stages of hyper-growth

Hockey Stick Curve of Growth

The perfect hockey-stick of growth achieved by those leading technology-led businesses is the aspiration of every ambitious start-up / scale-up business. However, this smooth curve fails to accurately represent the reality. It’s zoomed out, smoothed macro-view allows us to intellectually apply models of business maturity and define the stages over the course of entire life of the business.

The reality is that at any point in time, it is never this perfect exponential curve. Living through it is different. For a business undergoing significant growth, the truth is actually more like a number of much more granular, smaller, cycles of hockey-stick growth. Skyscanner’s growth in monthly active users from 2003–2016 is a far more accurate representation.

Skyscanner’s growth monthly active users from 2003 to 2016

Each year represents a new evolution or a new stage in the journey. There are points in the journey where conscious effort was required to ensure that we actively continued on that trajectory. The stages and cycles are much shorter and more numerous than a single lifetime model suggests.

In his 1981 book, Only the Paranoid Survive, Andrew Grove, Intel’s co-founder introduced the concept of an Inflection Point:

A strategic inflection point is a time in the life of business when its fundamentals are about to change. That change can mean an opportunity to rise to new heights. But it may just as likely signal the beginning of the end.

In a high growth organisation these inflection points happen frequently — some are localised to one product area but some affect the entire organisation. Each one creates new conditions, new norms and requires different approaches. There may only be months between them, particularly early on as the organisation accelerates. Rarely, do you get years. Whether it is because you discover new insights that require a significant pivot in your product destination or whether it is growing pains that come from doubling the team size, the fundamental shifts are inevitable.

Each inflection point is also unique to you and your business. There is no defined playbook for winning in your new context — to continue to thrive and grow requires your full investment in working through these challenges. Experience can help you recognise them, and help identify what may have worked in a similar situation but must be applied with caution.

Continuously Improve

Heraclitus, a Pre-Socratic philosopher who lived during the 6th century BC, is credited with this fragment.

Everything changes and nothing remains still … and … you cannot step twice into the same stream

As a software engineer, I have always known that Moore’s law has had a significant bearing on our discipline. As processors get faster, storage gets cheaper, new approaches and new systems are being built at an unprecedented rate. It is impossible to keep up with every advancement.

What I have come to recognise is that it is not just a technological evolution. The technology is only a tool we use in achieving our goals. Our approaches to problems and the process that drive those solutions, must evolve as we scale in conjunction with the technology. We have to increase the effectiveness of the whole system. As organisations, teams and individuals, we have to continually improve — accepting that, in our new context, what was previous working for us, will begin to limit our success.

What worked Yesterday, is Painful Today, Will be Broken Tomorrow

As we open ourselves up to challenging our existing approaches, we will begin to look at problems from different, more original, angles and experiment as a way to discover the new approaches that will work today. We begin to recognise that failure really is just an opportunity.

The essence to reflect and continuously improve is pervasive throughout Skyscanner. For the small agile squads, it has been natural for us to ask ourselves — “What worked well and what didn’t go so well” on a regular basis. What was considerably more difficult was when we started looking at large scale delivery problems spanning multiple teams. One such was our translation processes —when operating in 30+ languages this can slow us down significantly. We had to discover techniques and assess the whole rather than the localised problems a team faced. We stopped the flow of work and focussed on working through the problems. We applied Lean and Theory of Constraints techniques to review the weed out some of the bottlenecks and create a whole new approach that moved us from >2 weeks turnaround in translations to <2 days and subsequently <24 hours.

Time it right. Look to Leading Indicators.

One of the most used (and perhaps overused) clichés is Wayne Gretzky’s famous quote:

I skate to where the puck is going to be, not where it has been.

It has been re-used by the likes of Steve Jobs and Warren Buffet on occasion and is somewhat of a rallying cry for Product Management. However Gretzky’s ability to see where the puck is going has rarely been matched in the history of the National Hockey League — he still holds 60 NHL official records and he retired in 1999! It can only be asserted, that seeing where the puck is going to be is actually really hard. The intent of the statement, however holds true, which is why I suppose the quote is widely used.

One of the keys to navigating inflection points is recognising, you are coming up to one, particularly when you are winning. If you have already passed the point and can see the decline, it is probably too late. Timing is crucial.

Unfortunately, the ways in which we traditionally measure the success of a business, such as revenue, are lagging indicators.

Lagging indicators are clearly valuable, but they are “after the fact” measures that tell you the results, but not the status in an actionable timescale. A dip in revenue growth may indicate a shift in the businesses foundations, but this might happen months after the development of the root cause. It is then considerably harder to arrest the decline.

Leading indicators are better predictors of future events and can exit in near real time. They are most likely to be behaviour driven, rather than results driven. If you can understand the link between your customers behaviours and the end results then leveraging your leading indicators to affect the outcome is crucial.

Leading Indicators equally apply to your day-to-day operations. Ask yourself: “What is changing, what is becoming more difficult for the team? Where is the pain in the team?” Given their closeness to the problem, your frontline teams are very much going to feel the pain that the beginning of an inflection point brings before you are even aware. Some of these symptoms will be immeasurable, intangible or based on a feeling — there maybe nothing concrete in your measures. But knowing your teams are feeling pain, is a signal to find out why, and fast. They are the essential part of your early warning system.

During one period with Skyscanner, we were making decisions to deal with increased pain during releases, by reducing the frequency, increasing the overall size, but seemingly taking the pain more often. We were about to make a decision to replace a tactical 4 week release cycle with a 6 week one. Enough was enough. While product would get released, and monthly pain would reduce, we would create further challenges. Conventional wisdom applied that the same effort every 6 weeks was better than every 4 weeks. Ultimately the team, led the conversation to change the paradigm. We had an inflection point in our product delivery mechanisms. It took a significant amount of capacity and a number of months to vastly improve, but the path we set ourselves on resulted in hundreds of experiments being run every week by Skyscanner’s Product development team.

Your team is critical

Our organisation is a team and is made up of the people we hire to be the experts we are not. They bring their own uniques set of experiences and approaches. To move through inflection points we need the whole team to be supportive and supported. Your team is the most critical asset when navigating inflection points.

Hiring the right people is therefore a critical to your overall strategy. No matter what the stage of your business, a quality that you want to look for in every candidate is a Growth Mindset.

Growth vs Fixed Mindset

Introduced by Carol Dweck, she argues that our mindset determines whether we believe we can learn and change and grow. People with a growth mindset believe they are capable of learning to achieve anything, they welcome problems and see them as obstacles to be circumvented and overcome.

It is this kind of approach that you need to be able to constantly adapt to the changing circumstances created by growth. By looking for it in yourself and your team, you will naturally have the desire and resilience in the organisation to adapt as the business goes through a shift in it’s fundamentals.

For one of the largest inflection points Skyscanner experienced, it necessitated stopping all active product development for a number of weeks to fix some core issues. This is not a decision taken lightly, it dramatically impacted everything. We were slowing down, not specifically caused by anything but the team felt it, the organisation felt it. There were frustrations building with our approach. This was the trigger — not a measurable item. Only through listening to those colleagues at the front-line, who’s growth mindsets were telling us we could find a better way and were willing to help guide us, did we identify we were hitting some significant blocks that we had to change our approach again.

Conclusion

Being an active leader in an organisation going through hyper-growth is a very special and invigorating experience. Most businesses will not see the type of success that Skyscanner has. But for those who aspire to be that successful, these are my 4 lessons to help you navigate hyper-growth:

1. Inflection points are inevitable and frequent. Embrace the constant change.
2. Continually Improve everything, recognising that things that previously worked are unlikely to work again.
3. You have to Time it Right by looking at your Leading Indicators.
4. Your Team is critical and your most valuable asset. Hire those with a Growth Mindset and empower them to be successful.