Management literature is full of the ‘hows’ and ‘whats’ of strategising and strategy management. I won’t blame if your head starts to spin in the process of trying to get some definitive direction on how to go about strategy planning.
The traditional schools favoured a structured view of the task. Whether it is the SWOT or PEST models or Porter's Five Force Framework or the Igor Ansoff Matrix, the idea was that the environment (political, economic, social, technological) had to be carefully analysed, made sense of and predicted, to start with, before any strategy was put in place. In such a predicted world, one needed to project what one can and should do and what the competition is likely to do (both on their own and as a response to what you do – Game Theory, if you will).
It is a different matter that, in most instances, the prediction work or effort put into it, falls short on rigour.
Mostly, organisations go by the past. It is merely a forecasting exercise based on the past. The unstated assumption is that the momentum you have developed will carry you through. Unfortunately, unlike in space, there is nothing like ‘escape velocity’ to assist you here and once you cross this threshold, you continue to travel, even without fuel.
Make that jump
One of the major challenges that organisations face is the position they should take, in terms of value proposition, customer segment, need that has to be fulfilled, and so on. Basically, the question is which opportunities to chase. Traditional approaches point to looking to the past/present and making the jump. This happy world was shattered by the advent of the Blue Ocean Strategy (BOS).
BOS basically stated that competing in a market with existing competitors and with a value proposition guided by existing context, is sub-optimal. The ‘current’ ocean is ‘Red’ with the blood spilt in competing and in the process of going for the share of the existing pie. The real opportunity lies in identifying the ‘ Blue Ocean ’. Uncharted, these are new to the world and full of opportunities. Suddenly, the traditional approaches were found inadequate to systematically identify ‘Blue oceans’.
The next big question to resolve is in deciding how big a target you must set for yourself. Should it be based on your current and future resources and capabilities? Should one take the opportunity and work back in terms of resources/capabilities? A combination of both? What about Big, Hairy, Audacious Goals (BHAG)? Don't you agree that what Steve Jobs and Bill Gates did happened because of BHAG?
They never allowed the past and present to constrain them. They created the future rather than make projections based on the past/present. They charted new paths. While a lot of organisations pretend that they belong to the audacious group, the reality is that only a few of them do.
Identifying the ‘next’ big opportunity
How do you go about identifying the ‘next’ practice opportunities? Is it through an R&D chief coming up with breakthrough findings in the labs? Should one look at the competition and see where the market/industry appears to be going and follow them? Should our market and customer research department guide us? The traditional marketing/consumer research approaches are increasingly found wanting as they don’t accurately discover the real pain points/needs of the consumer and, hence, the real opportunities. Neither can our scientists help beyond a certain point as they are necessarily constrained by the ‘Inside-Out’ worldview.
With consumers going digital and mobile, and life-styles changing, ethnographic studies and immersion research approaches are increasingly becoming the way to discover the real needs of the consumers.
You don’t just ask consumers direct questions about what they want; instead, you go and live among them, observe them in day-to-day life and develop insights about the needs and possibilities. It is through such ideas that the next possible product or service emerges.
All this points to the need for having a relook at/review of our approach to strategising and planning. This is also necessitated by the fact that in a world changing at a rapid pace, we no longer have the luxury of an elaborate strategy-making process.
Parallel processing
The prescription is that you ‘implement / execute’ as you ‘plan’, alongside the planning. It is a parallel process and not sequential. Create a flexible mindset, some dexterity and nimbleness in the organisation and resources. Be prepared for mid-course correction. In order to enable that, you need to keep an open ‘mind’ as well as an ability to listen to the ‘winds’.
Invest in developing an organisation that, while being good at strategising, is also nimble-footed, open-minded, flexible and entrepreneurial.
The key is that a big firm should think with the dexterity of a small one.
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