At its core, strategy is design. And great design starts with the question: what if anything was possible. If we start with constraints we get designs for tomorrow that merely tweak today.
What if we applied the same design principle to the strategy process? This would improve the chance of creating something truly distinctive: a ‘breakout strategy’.
The alternative is a strategy process that ‘merely tweaks’ last year’s process. How did that go? Did it generate fresh insights? Did it evoke passion and commitment? Did you spend time on future possibilities? Create a distinctive view of the organisation 5-10 years out? Or looked at dispassionately, was the conversation dominated by today’s problems? Are you closer now to that 5-10 year view of the future you chose?
Here are five design ideas with the potential to transform your strategy process.
1. Broaden and deepen the engagement of the leadership team. A major challenge in strategy is to translate intent into outcomes. Too often those whose job it is to ‘deliver’ the strategy are mere recipients rather than participants in the conversation. With social technologies today we can engage the broader leadership team. This would create a step change in execution and improve the range of options considered.
2. Create an immersive experience. Pierre Wack[i] argues that ‘aha’ moments occur when you create stories and visuals that tap into the emotional and pattern recognition parts of executives’ brains. That obliges them to question their assumptions about the world. The intent is to make real possibilities that your team may not have imagined. Can you create a ‘big data’ experience for your team? What if the executives were immersed in an experience where they were a minority? In one M&A integration case study, executives role played the integration with roles reversed. The executives of the acquirer played the ‘acquired’, and conversely.
3. Design a series of strategic conversations. Many strategy sessions are simple, one off, two day programs. Successful companies in fast moving industry sectors find a natural rhythm around strategic conversations. Decisions that can be dealt with in one conversation are considered not sufficiently strategic to warrant the top team’s attention. Why not extend the conversation across a series of workshops? This allows time for connections to surface between insights from the workshops and the executives’ mental models. It catalyses informal, generative conversations between the formal sessions. And it also allows executives to share the conversations within the organisation.
4. Build your ‘strategic capital’ ahead of the workshops. ‘Strategic capital’ represents the firm’s evolved capacity to solve strategic problems. In one organisation I know we ran a series of development sessions with the leadership team ahead of the strategy workshop. At each session we introduced the leadership team to a relevant strategy model and then applied this model to their organisation/industry searching for insights. Over a period of 4-5 months we built strategic capital and developed insights which were harnessed in the formal strategy workshop. The strategy from that workshop continued to guide that business for many years. Why was this so successful? The process was designed around rigour and insight rather than schedule.
5. Embrace the ‘technology of foolishness’. There is a growing drumbeat around ‘innovation’. But innovation requires a technology of foolishness: openness to play, experimentation, and intuition. The same logic applies to developing breakthrough strategies. If we lack the courage to make ourselves vulnerable through the strategy process, why would we imagine the broader organisation is any more likely to embrace this spirit of innovation?
These might all be good design ideas, but does it translate into practise?
Starbucks and Howard Schulz are not prominent when Australian’s talk about business success stories: they should be. Starbucks market cap USD 90B / AUD 128B exceeds every stock on the ASX[ii] except the Commonwealth Bank (AUD 129B). When Howard Schulz returned as CEO in early 2008, its market cap was down to about USD 20B, and it continued to fall to around USD 10B before the turn-around took root.
Schulz is unconventional in many ways, including his approach to strategy. For example, in late 2008 he took 10,000 store managers to a 3 day leadership conference in New Orleans at a cost of $30M to reignite their passion. He was under enormous pressure to cancel the conference, but he held firm against strong opposition: reigniting people’s hearts and minds had to be done in person.
In preparing for the leadership conference Schulz argued:
Before we could challenge the status quo, my colleagues and I had to see it in new ways, reframe our existing ideas, and move beyond self-imposed constraints to imagine new possibilities.
How bold are you willing to be to achieve something truly distinctive? Call me.
[i] A legend in strategy process for his work developing Shell’s scenario planning
[ii] At the time of writing, ignoring the value BHP and RioTinto’s dual listing in the UK exchang