Book review: The Unicorn Project

This week A few weeks ago, I finished reading (and annotating) the book “The Unicorn Project” by Gene Kim. And I thought it would be good to make a small blog post about it.

*Steve Ballmer energy* Annotation, annotation, annotation

With the Unicorn Project and its predecessor the Phoenix Project, you get different ideas out of the book every time you read it. Many of the fragments and stories in the book are relatable if you work in any decently-sized company and that’s great because it keeps it interesting and fun.

The concept of the Three Horizons (Chapter 16 in the book) was new to me and gave me several “a-ha” moments because it was something I struggled with before. Since I’ve only worked at large companies (+3000 employees, large for Belgium standards at least 🙂 ), I had already wondered a few times how it could innovate (or create new products) with that many red-tape and rules around the seemingly hundreds of active projects at any given time.

Splitting your projects (or products/applications) into Horizons makes a lot of sense. It allows the core of your business (Horizon 1, the closest horizon) to prioritize stability and revenue and giving you breathing room ($$$ for people and resources) for new ideas, your Horizon 3. Those projects should be setup for prototyping new ideas and quickly iterating and shouldn’t be held to the same standards as a Horizon 1. The book mentions 3 critical success factors for a Horizon 3 project to become a Horizon 2 project:

  1. Does the idea solve a real customer need? You can only find out by launching quickly and validating with actual customers.
  2. Is it technically feasible? You’ll quickly find out (technical) problems you hadn’t thought about if you try and launch a product.
  3. Is there a financially feasible engine of growth? By launching quickly, you’ll find out soon enough what it’s worth to customers. (They should be willing to spend money on it or you’re probably not checkboxing number 1)

The quick iterations of Horizon 3 projects are paramount to find a new business fit and will result in clear winners. Those winners, the ones that tick the boxes above, can become Horizon 2 projects.

A Horizon 2 project is a way for your company to expand its business domain, to find new customers, new markets, … They’re your future Horizon 1’s, small now but potentially high-growth and high-revenue if it solves customers problems.

A picture might drive it home a bit more. Let’s say your are a car company and you make petrol cars (or engines that work on petrol). This is your Horizon 1 and your money maker. It pays the bills. However, it turns out that each product behaves as a normal (Gaussian) distribution:

Now you’ll agree with me if I say that the time of petrol cars having a bright and solid future is kinda over. We have a climate crisis and electric cars with decent reach are available in the market. Furthermore governments, such as Norway, are heavily subsidizing the electric cars to make them cheaper until there is enough production capacity that the scale of production makes them cheaper.

So what do car companies need to do? In hindsight, it seems that electric cars or working on battery technology would have become a Horizon 2 project if launched at the right time as a Horizon 3 project within the company. Other Horizon 3 projects could’ve been alternative fuel possibilities (hydrogen, …) or better entertainment systems or going building other types of cars (SUV, small lorries, …). The possibilities of Horizon 3 projects are endless and the rapid validation of ideas is needed to find the “good” ideas.

You’ll have a lot of Horizon 3’s and eventually you’ll have one that will become your new Horizon 1.

Note that unsuccessful products don’t finish their bell curve or never reach anything resembling a bell curve.

Long story short

I think there’s so many ideas and concepts in this book that anyone in IT Management or IT will for sure have “a-ha” moments like I had for the Horizons explanation in the Unicorn Project. So, a must read in my opinion. 🙂

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