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Pattern: Gradually Raising the Stakes

In an uncertain environment, slowly increase investment in learning and information gathering;eventually you uncover enough information to reduce risk and make better informed decisions

You are in the beginning of a transformation, and the executive team is committed to moving forward but needs to map how it will proceed. The company is new to cloud native, and the team has little knowledge or experience in the field.

In This Context

Making major decisions before having enough information to understand the parameters carries a great deal of risk. However, in the uncertain environment of an early cloud native transformation when there is not yet much knowledge or a clear path, grabbing right away for a “big bang” solution is very tempting.
• In traditional environments budgets are allocated based on full estimation of scope and a clear execution plan.
• In the cloud native environment high uncertainty makes estimation difficult;next steps are not predefined but uncovered one at a time.
• Executives still expect problems to have a well-defined and reasonably predictable solution, because that is how they have always worked before.

Therefore

Avoid making big decisions early; do a series of small projects, always growing slowly in size, until you have enough information to make a big bet.Begin the initiative with small no-risk actions that benefit the organization in any circumstances(see: No Regret Moves). Once a baseline understanding is in place, moveto actions that help deepen understanding in areas that seem especially relevant to the organization’s transformation goals, and begin narrowing down the field of options(see: Options and Hedges). Eventually a reasonably clear best path will emerge, andthe company can then make a reasonably confident Big Bet commitment. This, in the cloud native context, means building an MVP version of the most likely large-scale solution.
• Move incrementally through three stages: first, learn the basics. Then deepen knowledge through more detailed investigation and experimentation, which helps eliminate wrong choices. Finally, gather the information revealed and use it to decide the best likely path.
• Once the big bet is taken, stay on the path until the circumstances are stable.
• If circumstances change due to new information uncovered by experiments, or if the market changes, then remember to refactor the strategy using Dynamic Strategy.

Consequently

The project has been gradually refined/decided without taking disproportionately high risks, and appropriate budget and resources have been allocated to each stage based on its level of uncertainty.
+ You know how much resource each project will require as you uncover next steps; you are allocating just that, no more, no less.
+ The level of detail of the project, and the understanding of the scope and the context, gradually increases with each step—which proportionally lowers the embedded risk.
− There is great ambiguity in the project, which prevents thorough financial and resource planning. Ambiguity typically feeds anxiety.