Choosing Between Outcome and Schedule

It may be tempting to be a little more careless about your product if it means you can get it to consumers faster. This usually doesn’t go over well. Let’s take a look at one of the most infamous engineering mistakes and how it was ignored in order to keep the project on schedule.?

An important lesson learned?

There’s an old adage in the printing industry: “Speed, quality or price. Pick any two.” Meaning, no printer can give you all three at one time. For early stage companies, this is a choice no customer wants you to make.?

Customers want the product you promised to deliver – on the schedule you promised them. But, more often than not, this just isn’t possible. Only the CEO can make the call: Do you want to be outcome-driven or schedule-driven?

If you have to choose between delivering the schedule or ensuring the product will work properly – always, always prioritize the product.

The story of the 1986 Challenger spacecraft accident is a great example of how wrong it can go when companies become schedule driven. In short, a previously identified safety issue was ignored, and the Challenger blew up 73 seconds after takeoff. You can read the full story, including insights into how contractor Morton Thiokol behaved, is available here.

Making the right tradeoff?

Here’s how we think of this tradeoff from an early stage investing standpoint:

Delays in timing are survivable; product failures may not be. We’ve only had a few outright product failures across 110 invested companies – most of them along with unrealistic schedules.?

Schedule delays typically do not kill funding. Investors often threaten to stop funding companies that miss their timing, but in our experience, they rarely do. The right investors for your early stage company will be outcome-driven, not focused on IRR. They’ll also have personal experience with things taking longer than expected, so generally, they’ll be there to support understandable extensions in time to market. If they don’t get this tradeoff, you may have the wrong investor.

Most schedule and product performance “disappointments” are under your control. This is another way of saying that CEOs should under-promise and over-deliver. Remember, you are the one who told us how fast, how far and how much. Our advice? Tell the truth as best you know it – then add a bit of cushion!?

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