Lenny's Podcast: Product | Career | Growth
01:04:07 · Brian Balfour, Lenny Rachitsky
[01:04:07] S1: Yeah. That's right. Yeah. Like, if if you if you don't do it, you know, somebody else's. Yeah. And I think... And and I think that's also kinda what all the major media publishers are really contending with right now. [01:04:18] S0: I guess I need a licensing deal in your check, so... Anyway. Okay. I I wanna go on a totally different tangent. We weren't planning to talk about this. I know that, I said this. We're gonna be fully focused on this one topic, but there's something you mentioned to me before we start recording that I think will be really interesting to a lot of people. So you guys at Reforge are now building actual SaaS products that people can buy. It's not just courses. I don't know if people know that, but let's make sure people understand this. There's actually products for product teams. So maybe just explain that briefly. But the thing that I think is really interesting here is you work with a lot of companies now selling them AI tools. And you have noticed a very big difference between the companies that are really good at adopting AI tools and seeing gains from them from those that don't. Talk about just what you see there and... Because this is, in theory, gonna be really helpful to companies that are struggling with adopting AI tools and seeing gains.
01:05:08 · Brian Balfour
[01:05:08] S1: Yeah. Just to quickly explain that tran... Transition so it it makes sense for people, which is, you know, I sort of Reforge just with, the interest that there was all these incredible leaders out there growing, you know, on the front lines of some of the fastest growing companies. And they have all this amazing knowledge, and I wanted to encode it in useful and practical ways for others. Right? That took the form of courses and content and product and all that kind of stuff at the beginning. Along the way, everybody kept asking us to essentially build the tools to implement what we taught. Because with anything, it's like you can learn as much as you want. You can listen to my podcast, your podcast, Lenny, like whatever as much as you want, but if you don't actually put it into action and implement it, then it's not really going to create value. Right? And so people kept asking us to to really close that gap, and we said no for the longest time. Then about a couple years ago, when AI really started to inflect, it really created this moment that, Oh, wow. Now we... There's this opportunity not just to encode this knowledge into content, but also into the products, the software, the tools that we use ourselves. And so we started to take a really big bet on that and started to develop this new platform for AI native product teams. The first product we launched is called, Reforge Insights, which acts like your AI product researcher, kind of aggregates all the feedback from all the sources, uses AI to analyze it, helps you explore it, but also, will start to identify, like, what are the gaps, the things that you don't have in your feedback today and auto generate the research to go gather all those net new insights. So complete the full cycle. We're gonna watch two other major products as part of this platform before the end of the year, but, we'll we'll save that for some some future episode. So that's kind of been our our journey. And so we've seen inside companies that are going through this transformation from two perspectives. One is obviously selling in that tools, but the other perspective is for ten years, companies have been coming, to us to help them drive some sort of transformation with our learning product. You know, most people... Most companies are not coming to us to, just like throw a bunch of courses in front of...
01:07:33 · Brian Balfour
They're they're trying to solve some big business problem, some transformation. Now that used to be things like, we've got to figure out this growth thing. Right? Or I'm going from sales led to product led or, you know, I'm turning... I have more project managers, and I need to transition to product managers. Right? Like, something like that. Like... Or there's some business problem. They're going through some transformation, and they they saw us as part of that transformation, and we got to partake in quite a few of those types of transformation. Now, of course, the transformation that everybody's going through is, okay. How do I become more AI native? How how do I adopt this stuff? And and so we've seen a pretty wide spectrum in... From both perspectives of how companies are approaching this. And I'm sure everybody's seen the, like, AI... I call... We've been calling them, like, the AI manifesto memos from CEOs out there that proclaim we are now AI native. You know, It's some grandiose way. Right? There's behind the scenes, there's actually some incredibly stark differences in the actual teeth of what backs up those memos and backs up those executive decrees that, you know, we should all be, you know, AI. And and so just to kind of point out, a few of them, which is, one is that, there... I think the most impactful thing, that you can do is form really hard constraints. So a lot... What what you... There's there's other parts that's like, okay. Wanna communicate this. You wanna establish an owner of who's going to drive this. You want to build in incentives and rewards. And you see this all playing out in things like building it into your career ladders, or some people are starting to introduce this as questions into their performance reviews, all those types of pieces. But the thing that is actually moving the needle are the companies that are defining incredibly hard constraints. So one company that we worked with developed this constraint that they benchmarked against other companies of their revenue size and the team sizes, for their stages, and they set a benchmark that we will be one fifth. Each of our functions will be one fifth the size. And and what that did is it created a constraint that you couldn't hire above that level, and it forced people to essentially find ways to adopt AI and and do things to to to replace that. So that was one.
01:09:58 · Brian Balfour
You've seen these other ones. I can't remember from what company. This might have been Shopify or another who was like, you are not allowed new headcount until you prove to us that you are not able to accomplish this with AI. That's another hard constraint. But you also see these other constraints on the smaller level, which is, you know, executives saying, I will not do a product review, or review a PRD unless it comes with three prototypes. You know, some some something like that. And so that's that's the hardest one. But those are the biggest constraints. But I think the biggest change that I'm seeing is... And and the things that separates out the the top few percent making this change and and everybody else is, is essentially making the hardest decisions. And that hardest decision is going to come down to exiting people. So in every transformation, what we see is essentially three groups of folks. You see your, we call them the catalysts, the people kind of leading the charge, the people who are experimenting, you know, doing this on their own, time, like all that kind of stuff. You then have, your, what we call your converts. These are folks that will make the transformation. They will adapt. But they need structure. They need permission. They need a clear outline. They need a clear plan. Right? And I don't say this in a negative way. It's just that that's how some people operate. Right? And so that's where things like, all the things that we were talking about before, which was the decree, the permission, the clear budgets, the rewards, all of those types of things. But then inevitably, have a certain percentage that are anchors. Right? And they're dragging their feet. They're kind of silently creating friction in the background and like all those pieces. And there's a big difference in how I think companies are treating and thinking about their strategy for those folks. One group is kind of like, ah, we're going to work with them very passively. Others have set a hard deadline. They're like, either make the... They're going to either make the transformation by x date, or we're gonna exit folks. And a lot of people look at this as being really harsh. I think a lot of people would think that, especially individuals. But let me kind of explain it from a... As more of like a CEO perspective.
01:12:21 · Brian Balfour
A lot of these companies are seeing this AI transformation, the the ones that are taking it more seriously as this isn't adopting new tools. This isn't a light change. This is a fundamental culture change of how we operate as a company. Right? And you can't have 20, 30%, whatever meaningful number of it is of your company trying to operate in a completely different way, in a in a completely different culture. Cultures thrive on density. Right? And that's why they're sometimes... The best ones feel like cults. You know? And and so as a result, from that perspective, it's like, hey. Like, we... For us to be successful, for this to be the best thing for all employees, we all need to be operating around the same culture of principles and stuff. And if that's not you anymore, then we're defining a plan to exit it. But I would say that less than 10% of companies we see are taking this hard stance. But I would say they are probably the ones that are farthest along, getting the most adoption, and are seeing the most results, of the ones that are taking those hard stances. So there's a bunch of other stuff I could talk about, but that's kind of the high level of kind of what we've what we've seen across a bunch of different companies.
01:13:37 · Lenny Rachitsky
[01:13:37] S0: That is incredibly interesting. I'm glad we went there. There's a... I have a newsletter post coming out soon, probably before this episode that touches on some... A lot of advice along these lines. I... I'm excited for you guys to keep seeing these insights into companies and sharing more of those because this is, I think, what a lot of people are looking for. Just like things aren't quite clicking at our company. We keep hearing everyone getting so much more productive. All these companies are running more efficiently and it's not working here. So I think this is the kind of advice a lot of people are looking for. So thank you for sharing all that. Brian, is there anything else that you wanted to touch on? Anything else you wanted to leave listeners with before we get to our very exciting lightning round?