Yesterday I had a deep discussion with a close friend about leverage, scale and accountability on organizational psychology. Later that evening I also found an event on AI at scale where startups, medium businesses discussed the details on scaling with AI in their businesses. The following thoughts are a reflection of those conversations and some of my first principles on these topics.  

I have been deeply trying to understand how and why medium size businesses are now trying to pivot to chase explosive growth just because AI- factories are becoming a thing- pushed by tech giants to create consumer behavior. 

On paper, such roadmaps are visionary. In practice, it exposes the exact pattern that kills far more companies than bad technology ever does.
 
Here is my take away from these conversations and the great meetup that has opened my eyes on execution far differently than I thought about it: 

Charlie Munger’s favorite mental model is:
 

Here’s the guaranteed path to failure the speakers shared that they have observed:

- When leadership routinely miss or arrive unprepared to key cross-functional meetings.

- Critical initiatives stall: debates over organizational structures over execution to the market signal.

- Team members end up doing work above their pay grade just to keep momentum. Everyone senses the lack of ownership. Resentment builds quietly.

- The 50-100X leverage becomes the distraction: heavy investment in innovative direction while not clearly communicating the boundaries of risk vs liabilities of such a investment leads to unintentional situations compounding that slows down the next best bet execution.

Poor execution and misalignment (not tech failure) cause 9-28% shareholder value destruction in AI transformations for most companies and these are supported by real world data. Most pilots never escape proof-of-concept because of exactly these human frictions - no clear accountability, fragmented visibility, and incentives that reward presence over outcomes. When the loudest voice in the room (the CEO) is disconnected from the most junior persons questions and recommendations- they are bound to make decisions which are rather irreversible and lead to fail slow and badly. 

It's important to analyze clearly and with full signals a company’s atomic truth. There is for each company which has stayed long enough in the game: an irreplaceable specific knowledge. This specific knowledge finds its signals in the heartbeat of the company's execution from business and operations for example: high-margin recurring business revenue, the long standing relationships as moat. With the AI advent, people seem to forget while road mapping that compute power is merely a tool, no doubt a powerful leverage, but useless without rock-solid execution, enablement and relationships.

Without accountability at the top, leverage turns negative: wasted capital, misdirected engineering, and stolen productivity minutes from every team member who rearranged their day around missing leaders as there is more directions pursued than knowing where distractions lie. 

One leader in the room pointed out that there is a saying by VCs that: “If you’re not 100% into it, someone who is will outperform you by a lot because compound interest and leverage really apply.”

When leaders aren’t fully present, the entire organization operates outside its collective Zone of Genius.

Over the course of talks, one talk outlined it in the best way, they shared the following: 

Steve Jobs, returning to Apple in 1997: He slashed the product line by ~70%. “Focusing is about saying no… The result of that focus is going to be some really great products.”

He understood that great companies prune good ideas to protect great ones. Chasing every exciting innovation alone in a corner dilutes the mission.

At the meetup, there was a leader who poured his failure with vulnerability where she shared that there was a time for them where saying yes before the fundamentals are locked in is exactly how their comp ny lost the bet. She shared small examples of history, which are littered with pharma/tech firms that poured resources into flashy alliances while lagged on execution internally; only to watch backlog stall, margins compress (real guidance often conservative 0-4% despite ambitions), and talent drain.

She suggested that using Steve Jobs reality-distortion field could work far better because he stayed maniacally aligned on the core. Great leadership does the same: protect the fundamentals first. Execute like art on it; everything else comes last.

From both the scenarios, the conversation with my friend and the meetup on execution of companies, turns out that the antidote is simple, almost boring...  which is why most ignore it.

- Each minute the C suite are away from their work is a minute of productivity you have stolen from the organization. Their presence and service to the juniors is:respect and leverage multiplier.

- Communicate delays instantly (Slack, text - whatever is fastest). Arrive composed, prepared, focused. No excuses about “not having visibility.”

- Print your calendar. Green = energizing, red = draining. Outsource/eliminate the red until 75-80% of your time is in your Zone of Genius (uniquely world-class + you love it). Zone of Excellence is the silent killer - many leaders stay there because “people need me,” draining everyone else. When leaders operate in their Zone of Genius and show up fully, alignment cascades. Execution forms naturally around real deliverables. Visibility issues vanish because ownership is clear and trust is leaned into. The need of be ng into visibility fails because there is trust on the team on the big story execution.
 
 

In short there are a few exercises we did to identify what makes a great company:

- Everyone knows the North Star (the atomic business truth).
- Leaders model radical accountability and presence.
- Energy flows to genius work, not cleanup or excuses.
- They say no to shiny objects until the fundamentals compound.

Normal organizations chase the reven e multpliers while tolerating unaccountable leadership. They debate structure instead of delivering. They lose the bet quietly —one stolen execution mistake.

Great ones invert the failure modes, prune ruthlessly, and obsess over presence and energy. They turn pre-existing leverage into exponential returns first. There was a great exercise on doing the following in whatever role we exist in: 

This post is fully hand written due to the above feeling. 

Pri

https://world.hey.com/priyata