Flywheels: From Theory to Action

A three-step process for informing strategy, org structure, and metrics that matter

In my last post, I shared a deep dive into flywheels and how they manifest in mental health tech. To my surprise, those efforts led me smack bang into another powerful strategic framework: north star metrics. 

As I mapped out the various flywheels that exist within Limbix’s product, I noticed that each and every one of them had a single step in common. It became clear that this step represented a high-impact metric that was foundational to our success.  It eventually informed the north star that our entire company now rallies behind.   

I traced the path I took to this insight and deconstructed it into three steps. Anyone can apply this process to reveal valuable insights about the metric that matters most to their business: 

1. Identify the individual flywheels that exist in the business

2. Map out how the flywheels interact with one another

3. Identify the central node to inform the north star metric.

Let’s walk through each of these steps as they apply to Limbix. 

Step One: Identify the individual flywheels  

The four flywheels outlined in Flywheels in Mental Health Tech

In my last post, I identified four types of flywheels that occur frequently in mental health tech:

1. Shared economies of scale. For example, when a mental health company invests in technology to lower the marginal cost of care. If the lower cost is passed on to patients in the form of lower prices, it attracts more patients, which drives down per patient costs even further.

2. Network effects. For example, when two-sided marketplaces are built to match therapists with patients. More patients attract more therapists, which attracts even more patients.

3. Brand habit. For example, when a digital therapeutic becomes associated with the treatment of a specific diagnosis, that therapeutic is more likely to be recommended by healthcare providers and used by patients, which strengthens the association even further. 

4. Switching costs. For example, when a product gets integrated into a health system’s electronic health record (EHR), it becomes costly for those health systems to switch to another vendor. This reduces competition, making it easier for the existing vendor to upsell and cross-sell new products to the health system.

Let’s see which ones apply to Limbix. 

Flywheel One: Brand Habit

From Flywheels in Mental Health Tech:

Brand habit refers to the positive association between a product and its value proposition. 

When a customer has a positive experience using a product it strengthens that association, increasing the likelihood that they’ll use the product again. At the same time, prospective new customers vicariously learn the brand habit from existing users, making it more likely that prospective customers will convert.

At Limbix, we’re building a special type of product called a prescription digital therapeutic.  It is standalone software (i.e. an app) that is FDA cleared for the treatment of a medical condition and is prescribed to patients by licensed healthcare professionals.  

The more providers prescribe our digital therapeutics, the more patients are helped, which in turn makes it more likely that existing and prospective providers will associate our therapeutics with their standard of care. This, in turn, increases the likelihood that providers will prescribe our therapeutics in the future. 

Limbix’s provider brand habit flywheel

Flywheel Two: Switching Costs

From Flywheels in Mental Health Tech:

Switching costs refer to the loss in value that a customer incurs when switching to an alternative supplier. 

New customers often invest considerable resources in integrating a product into their existing systems. If the customer then wants to switch to a different provider, they must incur that cost all over again. 

Furthermore, if that customer wants to buy related products, there is a distinct benefit to purchasing from an existing vendor. This is especially so if the new offering seamlessly integrates into the vendor’s products. This dynamic lowers customer churn and makes it much easier for vendors to upsell and cross-sell products.

When providers consistently prescribe a Limbix therapeutic, it often gets formally integrated into their clinical workflows. While this occurs at the individual provider level, it also occurs at the health system level, whereby the administration incorporates Limbix’s therapeutics into default workflows and electronic medical record (EMR) configurations for all providers within the health system. 

Once these integrations occur, providers are more likely to continue using Limbix therapeutics, rather than switching to those of a competitor. Additionally, providers become more likely to use our future therapeutics since they seamlessly integrate into providers existing workflows and systems. 

Limbix’s switching costs flywheel

Flywheel Three: Data network-effects

From Flywheels in Mental Health Tech:

Data network effects occur when new data makes the product more valuable, and increased usage of the product yields more data. A classic example is the navigation app, Waze.  Users create traffic data, which produces better route calculations, which encourages more usage, which generates more traffic data.

At Limbix, we leverage data from our digital therapeutics to continually improve engagement and clinical outcomes over time, which in turn, leads to more usage and more data. 

For example, we can incorporate algorithms that personalize our intervention to the patient, optimizing for clinical outcomes and engagement. The improved outcomes and engagement lead to more usage by existing patients and incentivize more providers to prescribe our therapeutic. This will produce even more data, which further optimizes the personalization algorithm.  

Limbix’s data network effects flywheel

Step Two: Map out how the flywheels interact

Flywheels do not exist in isolation. In fact, they have been called the “meta competitive advantage” because individual flywheels naturally combine to produce a force that is greater than the sum of their parts. 

To map out Limbix’s flywheel meta-structure, we must identify the linkages that the flywheels have in common.  

All of our flywheels include provider prescriptions as a step. I’ve visually represented the full system by putting this common step in the center. 

Limbix’s integrated flywheel diagram: one flywheel to rule them all 

Step Three: Identify the central node to inform the north star metric

Prescriptions from providers serve as the central node that joins the three flywheels together. That is, accelerating any given flywheel, increases the number of prescriptions, which, in turn, accelerates all the other flywheels in the system. 

This central node has informed our north star metric. 

As Amplitude writes:  

A north star metric is the key measure of success for the product team in a company. It should  consist of 2 parts:

1. A statement of your product vision, and

2. A metric that serves as a key measure of your current product strategy

Applying this to Limbix, we arrived at the following vision and key metric:

Limbix’s Vision and Key Metric

Furthermore, a north star metric should be composed of multiple inputs, each serving to drive the metric. 

We can unfurl our flywheel diagram to inform the inputs of our north star metric.  

Relationship between Limbix’s product inputs and north star metric.  Inspired by Amplitude’s North Star Framework and John Cutler’s North Star Inputs & Flywheels webinar

We can then use these inputs to guide our organizational structure and OKRs.  For example, at Limbix, we have dedicated teams for each input: patient engagement & clinical outcomes, health system integrations, and provider awareness.

Each team prioritizes the initiatives within their input that will maximize our north star metric: # of active prescribers. Doing so gives each team clarity on what they should focus on while maintaining alignment with a cohesive company vision and strategy. 

Flywheels Matter

I didn’t know what I would find when I started my deep dive into flywheels. I was simply driven by a curiosity to learn about the strategic forces that shape mental health tech and Limbix’s products in particular. 

What I found was a powerful framework that had rippling effects across our entire company. From the macro of vision and strategy to the micro of team structure and metrics, flywheels have forever changed the way I approach product management. 

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Thank you to Ben Lewis, Jonathan Sockell, Elise Vierra, Jake de Medeiros, Amanda McCawley, Eugene Hauptman, and Tom White for valuable input on drafts.

Thank you also to John Cutler and Amplitude whose writing on north star metrics and flywheels helped shape this piece.