Let's start with some context: If you're not familiar with EOS, or the EOS Process you should be. The Entrepreneurial Operating System, or EOS, is a methodology developed and outlined in Traction, a book by  Gino Wickman. It explains an entire system for connecting strategy with execution.

I will address different aspects of the methodology in this article, assuming your familiarity with it. If you aren’t familiar with EOS, I highly recommend reading the book. If you aren’t in for that, you should at least watch this short video explaining it.

EOS helps companies with over $1 million in revenue grow and scale. It entails many different EOS Tools, like the Accountability Chart, the Vision Traction Organizer, and many more.The system is so sound that I jumped at the chance to run a distressed early-stage startup when the opportunity arose. I learned the hard way that without customizing the methodology, it wouldn’t be easy.

The following are three things I learned while implementing it. Avoid costly mistakes by keeping them in mind.

Spend 3x time setting rocks (goals) and getting buy-ins from external stakeholders

As part of the EOS playbook, rocks are set on Vision Building Day 1 and at quarterly planning sessions. It will take you anywhere from 60-120 minutes to set rocks with the leadership team if you follow the instructions. Each of you will come up with 3-5 rocks for the quarter, and you will "kill, combine, & keep" them. After setting the company rocks, each leader will establish 1-3 individual rocks.

Your 90-day action plan will be ready in 60-120 minutes. That's pretty straightforward, right?

Wrong.

This process might work for mature, private companies where the business runs a model that is proven and execution is the core focus. Here's why an early-stage startup can't do this:

The first thing you need to understand is that you cannot set a strategic direction in 120 minutes. A startup environment is full of ambiguity and resources are limited. Selecting the right priorities is crucial.

Spending too little time setting the right rocks will result in weak rocks that quickly become obsolete. You should treat this activity as the most important one. Prepare for the session in advance, gather all the data you need for an intelligent decision, and take your time.

Secondly, the board, not the leadership team, sets the strategy. Startups that receive external funding have boards, unlike regular, self-funded companies. There are external stakeholders who influence the company's actions (from above).

Leaders should not simply set rocks and execute them without running them by external stakeholders. They need to be getting feedback, engaging in discussion, and refining them.

It's a bad idea to skip this feedback loop because it will lead to a lack of buy-in from external stakeholders. When setting a strategic direction, you'll want them on your side. Both for their resources to accelerate implementation and their different viewpoints.

To understand why implementing the EOS system is different for startups and other types of organizations, we must remember the following:

Rather than the size, age, or revenue of the company, it's about its maturity

A mature company knows its business model. As a result, they know where their revenue comes from and where their product-market fit is. The startup world, and particularly early-stage startups, is different for several reasons:

An ambiguous environment causes direction to be changed much faster‍

In a regular company, a quarter is 90 days, but in “startup time”, it feels like a year. Everything moves at hyper speed because the main job is to answer questions and learn new information. It isn't practical to set goals every 90 days.

After learning something new that made our rocks obsolete, we constantly replaced great rocks every 4-5 weeks. Instead of setting rocks in a full-day quarterly meeting, I suggest holding a weekly 'rocks meeting' to determine if they are still valid or need updating. When you wait 90 days to update your rocks, you'll have a great deal of waste.

When everything is new, leaders need guidance and clarity more than usual.

EOS assumes that the company has already generated at least $1M in revenue annually. $1 million revenue companies have already developed systems and procedures, and their executive teams have repeatedly practiced their tasks. In the case of early-stage startups, it's usually not the case. There's so much to do when you start from scratch - and it's risky.

The goal is to ensure everybody spends their time on things that produce the greatest return on investment. With the overwhelming amount of work that needs to be done, every executive will focus on what they believe is most important. As you look at the individual rocks, it will be very obvious. The EOS methodology encourages leaders to set their rocks and goals for each metric.

DON’T.

During the planning session, outline each leader's individual goals and rocks. You should then also set up multiple 1:1 meetings to work through them together, refine them, and align them.

In other words, you have to be much more involved with your executives than you would be in other types of companies.

Although EOS is a great system, it is not perfect, nor is it sacred. I am not a professional EOS implementer, and I haven't drunk the cool-aid either. Therefore, my last recommendation is to:

Don't be afraid to adopt it when it doesn't fit perfectly

In order to make it work for our organization, here’s how I deviated from the original methodology:

On the Level 10 meetings:

• Segue time should be doubled - it's vital that you pay attention to your leaders' personal lives. Get to know each other better by spending 10 minutes a week learning something new. The benefits are numerous.
• Adding seasonal sections to the agenda. I added temporary events to the agenda to ensure they were discussed. "Accounts that are at risk of not renewing”, “customer interview highlights,” and “Call Outs” (where every leader can give positive feedback to another team member if they choose to) were just several of the sections I added to the agenda.
• We explain metrics & rocks, not just report on them. It is not necessary for me to have someone read the numbers to me. I can see them myself on my Excel spreadsheet. They need to explain what they see: What are they seeing? Is this number higher or lower for some reason? In the EOS system, add only off-track metrics to the Issues List. Why? That's not enough color for me. The same would be true for rocks: At every meeting, I'd hear "on track.” That doesn’t help me understand what is going on. I was interested in hearing from them—what had they done so far? Where have they run into problems? What can we do to help? It's not enough to allow leaders to answer "on-track" or "off-track" for you to have control over each department.
• Add verbal feedback at the end—sometimes when the meeting rating is low and no feedback is given, it defeats the purpose. I added a section that requires feedback if the meeting rating is below 8.

On planning sessions:

• I removed whole sections from some sessions. One of the startups I was working with was a distressed one. We weren't hiring anyone anytime soon, so I removed the entire "core-values" and "people-analyzer" sections. At the time, engaging in these activities did not produce a positive ROI.
• Split full-day planning sessions in half - I found that workshops all day long were tedious. It was too much for me to facilitate and participate simultaneously, even though some leaders enjoyed it. Alternatively, split the sessions into two days.

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Final thoughts

Although EOS is an excellent system, it is not bulletproof, nor is it suitable for every company, short or long term. However, you can find value in the methodology if you spend sufficient time customizing it to fit your needs.

Business leaders - you are welcome to update it to suit your organization. I want you to share your unique experiences and challenges with me.

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