Mental Model #3 In Action: Strategy Before Execution
Jeff Bezos’ Comet Strategy
A comet has a “head” with a long “tail.”
To Amazon, the “head” stands for the big sellers — profitable big items. The “long tail” stands for the “niche”/ rare items… but there are a lot of them! The aggregated sales of the “long tail” is greater than the sales of the aggregated “head.”
How this “Comet Strategy” relates to LPM value flow
The Portfolio “Head”:
1) Big initiatives
2) Loud stakeholders
3) High-Cost Epics
But there is a large value hiding in the “Long Tail” … the portfolio “long tail”… in the form of, for example:
1) Experiments
2) Minor enhancements
3) Low-cost automation
4) Edge-case customer requests
The aggregate values / returns of all these “long tail” items is a large ROI … larger than the ROI coming from the “head.”
Aggregated, these “tiny bets” create outsized ROI.
This is the exact principles behind LPM’s:
1) Hypothesis-driven development — experiments!
2) WSJF (Weighted Shortest Job First)… meaning, small jobs = faster flow
3) Lean budgeting (fund the flow (the Value Stream), not the project)
Lean Funding
A long tail approach means:
1) Stop overfunding giant initiatives
2) Start continuously funding small, frequent increments
Operations and Continuous Improvement
Small items (tail work) are often ignored but produce sustained compounding value.
Jeff Bezos’ “Comet Strategy” applied to LPM, in short:
”The portfolio is not just the big things. The real compounding comes from thousands of strategy-aligned small things.”
Strategy before execution paid off for Amazon… the portfolio is both “head” with a “a very long tail”… like a comet.
To be continued…
LPM is on Amazon
