We live in an era obsessed with more—where constraints of any kind are viewed as the enemy. Organizations, too, are susceptible to the belief that we should spend our days chasing more: more capital, more time, more strategic latitude. We imagine that total freedom—an open sandbox with limitless resources—will lead to innovation and momentum.
But reality, as study after study suggests, paints a different picture. Absolute freedom too often breeds absolute paralysis, and when every path is open, choosing one can become excruciating. Energy gets diffused across competing priorities, and progress stalls under the weight of infinite possibilities. It turns out that leaning into boundaries—rather than removing them—is what spurs momentum and innovation.
Of course, this is not a recent discovery. The oldest, most enduring institutions in history have long understood that boundaries need not oppress—they can liberate. Whether it’s the Jewish observance of the Sabbath, the structured daily prayers of Islam, or the monastic rhythms of Christianity, faith traditions have long utilized voluntary constraints to simplify life’s choices and create room for something greater. For the faithful, these boundaries eliminate external noise and create a container for deep focus, community, and purpose. True freedom is found within the discipline, not in its absence.
General Magic and the Infinite Sandbox
But what happens when an organization rejects constraints entirely? We find a poignant cautionary tale in the story of General Magic, a Silicon Valley startup in the early 1990s, detailed in David Epstein’s book Inside the Box: How Constraints Make Us Better.
General Magic set out to create a precursor to the smartphone—a personal digital assistant. The company possessed an unprecedented concentration of brain power, including engineers and designers who would later work on the iPhone, Android, and eBay. They also had massive funding.
What they lacked were constraints.
Because they had no rigid boundaries on scope, time, or technical limitations, they fell into the trap of trying to build everything. They engineered their own hardware, their own operating system, and their own software language. Every time an engineer had a brilliant, complex idea, the lack of constraints allowed the project to absorb it.
The result was a classic case of scope creep. They missed market windows and eventually collapsed under their own weight. They built a solution the market wasn’t ready for, at a price point no consumer could afford. General Magic didn’t fail because they lacked talent or money. They failed because they had too much of both. Without the hard walls of a defined box to force tough trade-offs, their brilliance scattered in all directions.
Building the Walls: Values and Policies
How do we resist throwing money and other resources at our challenges—pushing the boundaries of our sandbox further and further outward until every conceivable option is on the table? This problem is what led David Ogilvy, the founder of Ogilvy & Mather, who is often considered the father of advertising, to issue the famous maxim, “Give me the freedom of a tight brief.”
It’s up to us to design the constraints that will ultimately give our organization the creative and operational freedom it needs. In taking on this task, two primary levers are at our disposal—values and policies—and each is important in its own way.
Values build identity-based constraints. They dictate where and how an organization wants (and doesn’t want) to operate, expressing what the organization strives to be rather than what it is forced to do. Because a value inherently carries its own philosophical underpinning, it doesn’t require an explanatory manual. Most importantly, values are adaptable and well-suited for uncharted terrain. When we cross into a new market or face an unprecedented crisis where no policy exists, a deeply internalized value system acts as an internal compass that can be applied to new situations.
Policies, on the other hand, build restrictive constraints. They dictate where an organization can and can’t go. Policies rely on the past context and known variables they were built upon, making them more specific and structurally brittle. They can be extremely useful, but if we rely entirely on policy-based constraints, we’ll find ourselves paralyzed in fast-changing environments, because we can’t write a policy for a scenario we haven’t encountered yet. Not to mention, policies require an extra layer of rationale to explain why they exist, and risk feeling arbitrary without it.
The secret to organizational trust and true operational freedom lies in the balance between the two. Guided only by values, an organization will inevitably experience some operational ambiguity and chaotic execution. Governed only by policies, we can easily slip into bureaucracy, effectively smothering adaptability.
Turning Constraints into Strategies
Our task as leaders is to thoughtfully construct—and then navigate—our organization’s particular set of constraints, charting a successful course through those built on policies and those implied by our values.
Values-Based Strategies
Values-driven constraints are deeply tied to organizational identity. They are frameworks for elimination: by defining who we are, we limit our choices, granting our teams the freedom to move fast without second-guessing their alignment.
- Maintain a “stop-doing” list: When we map out exactly what our organization is uniquely built to be, we automatically clarify what we intend not to be. Based on Jim Collins’s research in Good to Great, this strategy encourages us to institutionalize a formal “stop-doing” list to prune secondary projects, behaviors, or clients that distract from the core mission. This internal filter frees up massive emotional and operational bandwidth, letting our teams pour 100% of their energy into what matters most.
- Embrace strategic trade-offs: Where a “stop-doing” list focuses on how we invest our internal energy, strategic trade-offs target how we show up in the market. Michael Porter argues that the essence of strategy is choosing what not to do. This value-driven constraint is all about avoiding structural incompatibilities. For example, if your identity is built on being the absolute lowest-cost provider, you wouldn’t offer high-touch, customized service. Designing the business model to explicitly reject certain offerings prevents an organization from trying to do too many things.
- Use values as filters for high-stakes decisions: In his book The Advantage, Patrick Lencioni argues that true core values should “hurt”—meaning they should cost you money and limit your strategic options in the near term. In uncharted territory, where go-to-market rules and organizational policies may not yet exist, forcing high-stakes decisions through the filter of our values acts as a compass. It can take 90% of the options off the table instantly, giving us the freedom and confidence to execute with alignment, even under pressure.
Policy-Based Strategies
Policy-driven constraints rely on rigid, non-negotiable structural parameters. They don’t manage identity—they manage mechanics, often forcing creative problem-solving by blocking the path of least resistance:
- Enforce resource scarcity: Startup research frequently reveals that resource scarcity can be a major competitive advantage. When teams are flooded with budget, they often throw money at problems, resulting in bloated, complex solutions. By establishing strict, rules-based caps on budgets, timelines, and other variables, we can prompt lateral thinking. The result is often that existing assets get repurposed, manual steps get automated, and elegant, cost-effective workflows get developed.
- Standardize the routine to liberate the creative: Cognitive energy is a finite resource. If our teams have to reinvent the workflow every time they format a proposal, onboard a client, or approve an invoice, they are using up valuable mental bandwidth. If we implement standardized policies for routine, repeatable tasks, we can eliminate a lot of unnecessary choices. Standardizing the mundane creates a secure operational baseline, giving our people the mental freedom to innovate where it actually impacts our bottom line.
Thriving In the Box
The next time we find ourselves wishing for more time, money, or certainty, we should resist the urge to push against these walls. Instead, we can step back and map out the terrain they create. We might then notice how inherited constraints spotlight operational bottlenecks that need our attention. We might see the way our values can shine a light into darkness, and how well-designed policies can mark safe boundaries.
Great leadership doesn’t ask for an unconstrained world—it leverages the constraints we can’t change and engineers thoughtful constraints that can push us forward. When we approach this process through a balance of both policies and values, we suddenly find ourselves on a well-defined path—and we find that constraints aren’t the enemy we made them out to be. When managed with intent, they become the track that allows us to build up speed, find alignment, unlock innovation, and work toward lasting progress.
Save as PDF