10 contrarian leadership truths every leader needs to hear | Matt MacInnis (Rippling)
Guest Matt McGinnis, CPO (formerly COO) at Rippling, shares insights on achieving extraordinary results through intense effort and deliberate understaffing. He discusses the importance of direct feedback, fighting organizational entropy, knowing when to quit a startup, and Rippling's strategy for building a comprehensive business software platform with AI.
Deep Dive Analysis
18 Topic Outline
The Importance of Extraordinary Efforts for Extraordinary Results
Learning More from Successes Than Failures
Transitioning from COO to Chief Product Officer at Rippling
Reforming Product Management and Establishing Foundational Standards
The 'High Alpha, Low Beta' Framework for People and Processes
Using the 'Pickle' (Product Quality List) for Product Quality
Hiring Frameworks: SPOTAC and Challenging Case Studies
Product as the 'High Order Bit' in Business Success
Understanding Product-Market Fit and When to Quit a Startup
The Immutable Market and Drug Discovery Analogy
Notion's Success as a Narrative Violation of Persistence
Compounding, Power Law, and Entropy in Business
Maintaining Intensity and Fighting Entropy as a Leader
The Importance of Feedback and Escalations
Rippling's Vision and the Future of Business Software
AI's Impact on SaaS and the Need for Bundling Data
AI as a Tool for Refining Communication and Ideas
Balancing Intensity with the Broader Perspective of Life
9 Key Concepts
Extraordinary Results Demand Extraordinary Efforts
To achieve 99th percentile outcomes, one must accept discomfort and relentless effort, as success requires constant pushing and avoiding the comfort zone. While extraordinary effort is necessary, it is not always sufficient for an extraordinary outcome.
Understaffing Projects
A deliberate strategy to assign fewer resources than might seem necessary to a project. This approach aims to prevent politics, avoid working on low-priority items, reduce waste and 'cruft,' and ultimately speed up execution by forcing focus on essential tasks.
High Alpha, Low Beta Framework
A mental model, borrowed from finance, used to evaluate people, processes, and products. 'Alpha' represents outperformance, creativity, or upside, while 'beta' signifies volatility or unpredictability. The ideal is high alpha and low beta, but different contexts require different balances, such as high alpha for product innovation and low beta for stable operations like payroll.
The Pickle (Product Quality List - PQL)
A lightweight, comprehensive checklist of standards for shipping a product at Rippling, designed to lower system volatility (beta) without suppressing innovation (alpha). It serves as a vessel for meaning and is consistently iterated upon based on observed issues, ensuring basic quality standards are met.
SPOTAC Framework
An acronym used for evaluating job candidates, standing for Smart, Passionate, Optimistic, Tenacious, Adaptable, and Kind. This framework helps leaders decode their intuition about a candidate's fit and articulate their assessment to others productively.
Immutable Market
The concept that the market's demand for a product is predetermined and cannot be changed by marketing or advertising efforts. Companies should view building a product as an experiment to discover if 'binding receptors' (market demand) already exist, rather than trying to create them.
Power Law Distribution
The observation that outcomes in many areas (e.g., wealth, performance, company success) are not linear but follow a power law. This means that top performers (e.g., the top 10% or 5%) receive disproportionately higher rewards, often 10x or 100x more, emphasizing the importance of striving for excellence.
Entropy in Business
Applying the second law of thermodynamics, this concept suggests that organizational systems naturally tend towards disorder and decay. In a business context, this means teams will unconsciously optimize for local comfort over company outcomes, requiring constant energy injection from leadership to combat this inherent tendency.
Narrative Violations
An idea, attributed to Geoff Lewis, that highly successful companies inevitably achieve their outsized success by violating common wisdom or established narratives in some significant way. This highlights that following conventional advice doesn't lead to extraordinary outcomes.
7 Questions Answered
Deliberately understaffing projects prevents politics, keeps teams focused on the highest priorities, avoids wasteful work on ambiguous tasks, and reduces 'cruft,' ultimately speeding up execution by forcing urgency.
According to Parker Conrad and Matt MacInnis, you learn far more from successes because seeing how things are done right provides more informative lessons and patterns than seeing how they are done wrong.
A leader's job is to fight entropy by relentlessly injecting energy, mirroring the CEO's intensity, and refusing to buffer team members from necessary demands, ensuring the organization operates at its highest possible level of drive.
Founders should consider quitting if, after two or three pivots (around year four or five), the business isn't experiencing clear, rip-roaring growth, as true product-market fit is usually evident much earlier and the 'never quit' mantra often benefits VCs more than entrepreneurs.
Withholding feedback is a fundamentally selfish act because it prioritizes one's own comfort over another person's improvement; therefore, leaders should demand and give direct feedback, viewing escalations and critical observations as gifts that help the system improve.
Point solution SaaS companies are in a difficult position because they often lack the comprehensive first-party data needed for AI to be truly effective. This suggests a future where bundled platforms with rich, integrated data graphs will have a significant advantage in leveraging AI.
AI, particularly tools like ChatGPT and Gemini, can serve as a non-judgmental thought partner to help executives refine language and articulate complex ideas more pithily and clearly, even if a significant portion of its output requires filtering.
29 Actionable Insights
1. Maintain Perspective, Play Hard
While pursuing intense effort and extraordinary outcomes, maintain perspective by remembering the brevity and insignificance of life, allowing for levity, and playing the ‘sport of business’ with full effort but without forgetting it’s just a game.
2. Know When to Quit
Don’t fall for the ’never quit’ venture capital propaganda; if product-market fit isn’t clearly evident after 2-3 pivots or 4-5 years, be willing to quit, reset, and start anew.
3. Embrace Discomfort for Results
To achieve 99th percentile outcomes, expect and embrace discomfort and exhaustion at work, as being in a comfort zone indicates a mistake and a lack of extraordinary effort.
4. Mirror CEO’s Intensity
As a leader, mirror the founder CEO’s intensity and ambition, rather than buffering team members from demands, to preserve high energy levels throughout the organization and prevent dysfunctional drop-offs.
5. Inject Energy, Fight Entropy
Recognize that systems naturally tend towards disorder (entropy); continuously inject energy into your organization to fight decay, maintain quality, and achieve extraordinary outcomes.
6. Always Give Feedback
Never withhold feedback that could help someone improve, as optimizing for your own comfort by avoiding uncomfortable conversations is fundamentally selfish and detrimental to high-performance teams.
7. Escalations Are Gifts
View customer escalations as valuable gifts that provide direct insights into problems, allowing for process iteration and system improvement, and never consider them an inconvenience.
8. Product is High-Order Bit
Recognize that product excellence is the ‘high order bit’ for business success; getting the product right simplifies every other function, including finance, sales, marketing, and recruiting.
9. Don’t Market Product-Market Fit
Understand that market demand (binding receptors) for your product either exists or it doesn’t; marketing cannot create product-market fit if the fundamental need isn’t there.
10. Apply Process Judiciously
Apply processes judiciously to lower ‘beta’ (volatility) in areas requiring reliability (e.g., payroll) without suppressing ‘alpha’ (creativity, outperformance) in areas needing innovation (e.g., zero-to-one product building).
11. Lead From The Boiler Room
As an executive, avoid making decisions from a distance; instead, immerse yourself in the ‘boiler room’ to study systems bottom-up and develop informed hypotheses for improvement.
12. Fight Local Comfort
As a leader, actively fight the natural tendency of teams to optimize for local comfort over company outcomes by relentlessly injecting energy and demanding high performance.
13. Join Winning Teams
To maximize learning and growth, prioritize joining winning teams and successful companies, as observing success provides more informative lessons than learning from mistakes.
14. Ask For Relevant Experience
When seeking guidance, ask people for their relevant experience rather than just advice, as this helps filter for genuinely informed perspectives and avoids generic, ungrounded opinions.
15. Dedicated Root Cause Escalations
Create a dedicated escalations team skilled at digging deep to uncover the real root causes of issues, tracing problems back through software and systems to solve them fundamentally, not just superficially.
16. Deliberately Understaff Projects
Deliberately understaff every project at the company to avoid politics, working on low-priority items, waste, slowdowns, and cruft.
17. Prioritize Foundational Work
When fixing a dysfunctional team or product, prioritize foundational work and address issues in their correct order, leading bottom-up from specific observed circumstances.
18. Develop Versatile Executive Skills
Strive to be a versatile executive who can be ’tossed into any challenge’ and bring order to chaos, fixing problems across various functions.
19. Create Cultural Vessels
To drive cultural change, create unique, memorable ‘vessels for meaning’ (like the ‘pickle’ for product quality) and consistently fill them with your desired meaning to foster common parlance and stick in people’s minds.
20. Test Understanding, Avoid Jargon
When evaluating someone’s understanding of a concept, ask them to explain it without using the specific jargon or buzzwords, which forces them to break it down and demonstrates true comprehension.
21. Use Challenging Case Studies
Implement a single, extraordinarily difficult case study for all product candidates, regardless of seniority, to assess their problem-solving depth, adaptability, and non-defensiveness when given new information, even if they don’t fully solve it.
22. Address Every Bug Publicly
As an executive, address every bug or issue you encounter by dropping it at the feet of the responsible manager, preferably in public, to model intensity and prevent entropy.
23. Conduct Backchannel References
Insist on conducting backchannel reference checks for every hire, as it’s a critical step that should never be skipped to ensure quality and fit.
24. Demand 99th Percentile Energy
When processes become routine or boring, demand 99th percentile energy from yourself and your team to prevent entropy from creeping in and causing system decay.
25. Model Intense Public Feedback
Actively participate in public feedback channels for products, modeling intense, direct, and questioning feedback to encourage transparency and continuous improvement from the team.
26. Publicly Review Product Flows
Implement a process where major product flows are recorded (e.g., Loom videos) and personally review each one, providing feedback in public channels to educate and align other product and engineering managers.
27. Embrace Founder Idiosyncrasies
Recognize that successful companies often thrive due to the unique idiosyncrasies and specific strengths of their founders, which great investors learn to spot and back.
28. Seek Great Product Managers
If you have a negative view of product managers, it’s likely you haven’t worked with a truly great one, so seek out and appreciate the value a skilled PM brings to a team.
29. Use AI for Language
Utilize AI tools like ChatGPT or Gemini as a non-judgmental thought partner to refine language and find pithy ways to articulate crisp ideas, especially for communicating complex concepts, even if only 20% of its output is useful.
12 Key Quotes
If you want to accomplish something truly extraordinary, if you want to be in the 99th percentile in terms of outcomes, it's going to be really difficult. Like it's going to be really uncomfortable.
Matt MacInnis
If they ever find themselves in the comfort zone at work, they are definitely making a mistake.
Matt MacInnis
Good teams get tired, and that's when great teams kick the good team's asses.
Matt MacInnis
You don't really learn from your mistakes. You learn from your successes.
Matt MacInnis
We talk in Silicon Valley about never quit, but that is complete, absolute venture capital bullshit.
Matt MacInnis
The Silicon Valley try until you die mindset is not pro entrepreneur. It's pro venture capitalist.
Matt MacInnis
The only antidote to entropy, the only antidote to decay in a system is energy. You got to inject energy.
Matt MacInnis
Teams will always optimize for local comfort over company outcomes.
Matt MacInnis
The most selfish thing you can do is withhold feedback from someone.
Matt MacInnis
Don't be chill. Chill doesn't accomplish shit. Be intense, be good, be respectful, be intense. Don't be chill.
Matt MacInnis
Nobody at Genentech thinks they can market their way to better performance inside your body. The binding receptors for that drug, they exist or they don't.
Matt MacInnis
Life itself is a temporary victory against entropy.
Matt MacInnis
2 Protocols
Rippling Product Quality Inspection ('The Pickle')
Matt MacInnis- Establish a comprehensive, lightweight checklist of standards for shipping a product, articulating the simplest ways to meet desired quality.
- Record a Loom video of every major user flow through the product.
- Personally review every one of those flows and provide feedback.
- Provide feedback in a public channel so other product managers and engineering managers can learn from it.
- Iterate on the checklist consistently in response to new learnings and observed issues (e.g., adding specific rules for feature flags).
- Submit new products to the CEO (Parker Conrad) for dogfooding and feedback, as he acts as the 'big admin' for Rippling.
Hiring Case Study Interview Tactic
Matt MacInnis- Give every product candidate, regardless of seniority, the same extraordinarily difficult case study that requires thinking across many dimensions.
- Evaluate performance using a rubric that outlines expectations for different seniority levels (entry-level, junior, mid-career, senior, executive PMs).
- Observe how far candidates get into the problem, noting how many 'corners' they see around, even if they don't solve it completely.
- Assess their defensiveness when given new information that challenges the validity of their proposed solution.
- Note their willingness to interrupt the interviewer to ask more clarifying questions.