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Why don’t we have a strategy?

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Re: Why don’t we have a strategy?

#111

Post by PeterisP »

splittingTimes wrote: post #59

I am always missing good, positive examples of what are and _are not_ "Goals", "Stratgies", "Missions", "Visions", "Key Results" etc in those articles. And where to start from and where to go? What is a goal? "Win in the market place" or "Become profitable" No, that is not a real goal. That is pure business survival. "Increase market share by %X." or "Grow our portefolio to enter the premium segment" That sounds more…

I would rather say that company strategy is a chosen position on the main tradeoffs. Obviously you want to do all the good things and none of the bad things and execute everything well, but in some aspects you have to pick which nice things you're ready to sacrifice for other nice things, and the set of those decisions is essentially your strategy.

From your examples, I'd rather say that "we want to enter the premium segment, even if we have to lose marketshare on the low end to get there" or "we want to increase marketshare even if we have to stop being profitable for a year or two to get there", that's strategy. "Increase market share by %x" is not a strategy but a goal, in that sentence the strategic choice would be the intent to focus on market share instead of revenue or efficiency or other markets, but not the percentage rate of the increase. The choice of when to enter or leave a major market (either product or geographical or audience) is a strategic one, where you often need to make a significant long-term commitment or it's not worth doing.

For another example, you can have a very profitable company with high volume and low margins, and for the same class of product you can have a very profitable company with high margins and low volume, however if half of your company is pushing for quality at the expense of costs and other half is pushing for efficiency at the expense of quality, your product or service will be uncompetitive at both of them so you want to make a company-wide strategic decision on that and communicate it to ensure alignment, instead of letting each part of the company (e.g. the workers that are close to the production) pick the tradeoffs that best suit their silo but contradict each other.

Re: Why don’t we have a strategy?

#113

Post by lumost »

divan wrote: post #69
lumost wrote: post #35

Earlier quoted context omitted.

The question is around scope, if you are building a strategy for yourself or your team - set smart goals. If you are building a strategy for an organization, then set KPIs. If you are building a strategy for a 100+ person organization, then you talk about vision.

That's what I'm talking about – explanations like yours are abundant (no offence). Following your advice, let's say I set SMART goal for myself - "Increase number of books I read per month to 10 by the end of the year". It's specific, measurable, achievable, relevant and time-bound". It's still a goal, not a strategy.

Do you need a strategy as an individual? I suspect anything resembling such would be too vague to be useful.

Re: Why don’t we have a strategy?

#114

Post by picsao »

dchuk wrote: post #14

The overwhelming majority of “strategies” are just rigid sequences of time bound outputs/shit you want to build, that always end up being wrong and needing to change because of new information coming in. Strategy needs to be: - We’ve identified this deep problem in the world that needs to be fixed - We want to bring the Vision to life where that problem is gone (a big bold future state of the world). - We believe bri…

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Re: Why don’t we have a strategy?

#115

Post by eastbound »

AlbertCory wrote: post #53

There is an old engineer quote that appears a couple times in my newest book, where at 3Com the Microsoft LAN Manager alliance and OS/2 were considered "strategic," as was the Bridge acquisition: "Strategic" means "you don't make any money." So yeah, we were all deeply cynical about that word, because it means, all too often, the inchoate wishes that MBAs throw onto a bunch of slides. I'm all in favor of a really wel…

I’ll go deeper than that: A “strategic” choice is an otherwise-incredibly-unjustifiable choice. When a nation builds an aircraft carrier (apart from the US who has 10), they call it strategic, when a town builds an airport, they call it strategic, because no sane model would justify expending 2 or 5 times the current income. It only starts to make sense when the nation/city/enterprise has another face, and finds itself moved onto another scenary, part of the G8, member of the unicorn club, etc.

Corrolary: When a manager says a choice is “strategic”, it’s because its financial justification can’t be demonstrated. He may very well be tanking the company, so beware of this territory. On the other hand, it’s worth putting any resource available and risking tanking the company if, for example, we expect the market to be 100% cloud at one point.

Re: Why don’t we have a strategy?

#116

Post by AlbertCory »

danielmarkbruce wrote: post #100
AlbertCory wrote: post #92

Earlier quoted context omitted.

I always like to distinguish "with hindsight" from "at the time." Anyone can figure out what's strategic from hindsight. At the time? I think probably Larry, Sergey, and Eric thought it was strategic then. Did they think it was more strategic than radio ads (a business long gone!) or TV ads (also gone!)? Not sure.

It was strategic. They needed to control the endpoints to protect search. Hence Chrome, Android, Daydream, watches and so on. Half of what Google does is an effort to control endpoints to protect search.

What I meant with "at the time" is: if you'd asked them THEN to distinguish a very few "strategic" projects from the lot of "not strategic," would they have picked Android?

Not "with benefit of analyzing all their moves since 2004, does a clear strategy emerge?"

The rule would have been "you can't say everything is strategic."

I actually think they would have refused to play that game. Because calling things "strategic" is stupid.

Re: Why don’t we have a strategy?

#117

Post by splittingTimes »

PeterisP wrote: post #111
splittingTimes wrote: post #59

I am always missing good, positive examples of what are and _are not_ "Goals", "Stratgies", "Missions", "Visions", "Key Results" etc in those articles. And where to start from and where to go? What is a goal? "Win in the market place" or "Become profitable" No, that is not a real goal. That is pure business survival. "Increase market share by %X." or "Grow our portefolio to enter the premium segment" That sounds more…

I would rather say that company strategy is a chosen position on the main tradeoffs. Obviously you want to do all the good things and none of the bad things and execute everything well, but in some aspects you have to pick which nice things you're ready to sacrifice for other nice things, and the set of those decisions is essentially your strategy. From your examples, I'd rather say that "we want to enter the premium…

Thank you for your reply. I really like your framing of the "what it a strategy" definition problem and the examples. That's what I was and still an missing. You also describe very much the struggles that can be seen at companies.

Did you write more down somewhere or read more on strategy that informed your position on it? Would love to read up on that.

Re: Why don’t we have a strategy?

#118

Post by splittingTimes »

laichzeit0 wrote: post #73
splittingTimes wrote: post #59

I am always missing good, positive examples of what are and _are not_ "Goals", "Stratgies", "Missions", "Visions", "Key Results" etc in those articles. And where to start from and where to go? What is a goal? "Win in the market place" or "Become profitable" No, that is not a real goal. That is pure business survival. "Increase market share by %X." or "Grow our portefolio to enter the premium segment" That sounds more…

As Marc Andreessen said in a recent Joe Rogan podcast the goal of vision is to “form and reinforce the cult”. You need to trick employees into believing in something. Cults and cult leaders are exceptional examples for corporations to learn from.

Isn't exactly the cult aspect that prevents you from making real improvements and grow? You get no critical feedback, no worthwhile reflection on what works and what does not. So you do less adjustments and cannot reach the optimum as fast.

Re: Why don’t we have a strategy?

#120

Post by danielmarkbruce »

AlbertCory wrote: post #116
danielmarkbruce wrote: post #100

Earlier quoted context omitted.

It was strategic. They needed to control the endpoints to protect search. Hence Chrome, Android, Daydream, watches and so on. Half of what Google does is an effort to control endpoints to protect search.

What I meant with "at the time" is: if you'd asked them THEN to distinguish a very few "strategic" projects from the lot of "not strategic," would they have picked Android? Not "with benefit of analyzing all their moves since 2004, does a clear strategy emerge?" The rule would have been "you can't say everything is strategic." I actually think they would have refused to play that game. Because calling things "strateg…

If you define strategy as choices/decision/capabilities which involve competitors, as opposed to "important", it doesn't have to be "very few projects". Very few strategic choices, but often a lot of projects to implement those choices. "Important" and "strategic" really aren't synonyms.

Walmart likely has 100's of projects under way which are focused on keeping prices low. They are all strategic because Walmart's strategic choice is to offer every day low prices. The probably have 10 projects underway related to updating their HR infrastructure - not strategic. Walmart's strategic choices are constrained - but once they made the choice to compete on price, hundreds of projects are strategic to them.

At Google, there has always been a fear/focus on the endpoints/clients. In Porter's terms, it's a fear of customer control, where the customer is a distributor rather than the end customer (Google search has about 3 or 4 customer sets, so it's not a perfect analogy). And it's a rational fear because if they don't control the browser or client, they are at risk of bing/others displacing them, or having to pay a fortune to be the default search engine in a browser (like they pay apple billions every year). There have been dozens of projects at Google which have more or less been "well if this is the interface of the future, we better be in it so we can keep search there". All these efforts are strategic. Sundar Pichai has been behind several of these efforts, because he gets it.

Calling Chrome "strategic" didn't sound stupid to anyone. Calling the self driving car "strategic" would have sounded stupid to everyone.

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