Commercial Truth

Everything we build to run and grow the core business is built to repeat what already worked. It extrapolates from the past, funds long horizons and predictable returns, and guards against risk. It is, in the end, a machine for generating motion: how fast, how much, against last year’s baseline for a forward-looking plan. What this machine cannot do is tell us what’s true. So the capability to discover Commercial Truth, and to adapt to it, fails at the core, because it was never built to measure the one thing that now matters most.

Culture rewards managing perception over objective reality.

From structural bias to success theater and vanity metrics, the Commercial Truth is already in the room, but your teams can't say it. They're often not incentivized to tell you, and worse, you might even be compensating them to hide it, because no one has the permission or the safety to tell the truth. So the truth gets buried, and the company operates from an inside-out view of itself in the world rather than the outside-in market reality in which it actually exists.

I know this revelation because I am guilty of it, as I almost drove a company off a cliff on a single point of view, certain I knew what the truth was and where it lived with my customers. My team spent months building something I literally “loved to death” that had no basis in reality. When we brought it to market, the customer evidence was blunt and brutal: no one wanted to economically reward us for a solution to a non-existent problem we had fallen in love with solving. The “love” was what killed it. The damning question was whether anyone was actually learning this truth as it was revealed, what the market was already telling us, or just subordinating and subjecting to hide it for what I wanted to hear.

Leadership suffers from an addiction to being right.

What was killing my company, and what kills most large organizations, is the belief that you already know the answer. From inside the team, it feels like conviction, and conviction is just another sense of confidence; the more of it you apply, the faster the machine reinforces the assumption you started with. But from the outside-in, these conviction biases - optimism, sunk cost, loss aversion - create an amplified set of unspoken permissions that the whole company and team then accelerate. It's hard to see counter-evidence in these moments, if you did not start with them, as they can feel like mistakes that invalidate the path to realizing your “vision."

You can resolve to bring the truth into the room from day one, in every meeting. To lead with questions, to put candor over consensus, to be the permission for truth. Here is one powerful hack that took me a decade to adopt: start every meeting with the bad news first. You must search for and fix the incentives and systems that prevent new truth from getting in the room. If you don't, the team will not sustain its commitment to truth as the quarter gets harder and the goals drift away.

Systems beat willpower.

As my friend James Clear has famously stated,

“You don't rise to the level of your goals; you fall to the level of your systems.”

The systems were built to run the existing business, which is designed to look inside-out. These systems measure every new idea against a control-biased view of the market, often with a rack-and-stack ROI method that rewards what we know, so new Commercial Truth never makes it through. It's designed out.

And the obvious fixes often tighten the trap. Hire smarter people, give them the tools and data; what you end up with, even with expensive pattern recognition trained on a world that’s expiring: build a better dashboard, and you’ve done nothing but measure motion at a higher resolution, still with no map, nor the right questions to ask where to take you. The capability to adapt is incapacitated as capital keeps flowing to zombie programs, programs years off track, and teams' relentless hustle to “meet the plan.” None of it looks, or even reveals, that it is, in fact, a failure. It looks like discipline.

The resistance to systems-based change is in the DNA of most enterprises because the rewards for change that produces new truth are undercapitalized in the planning and culture. It only responds to new market truth, often delivered painfully.

You can fix the culture, replace the leadership, hire the experts, buy a better dashboard, and the machine will still measure motion and call it truth. Every human fix runs through the same instruments, and the instruments and measurements are the problem.

Nothing changes until you build a system that is designed to deliver objective, evidence-based Commercial Truth, from the outside-in.

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