This is a nice and ambitious post. A few thoughts:
1. There are great insights in Clayton Christensen's The Innovator's Dilemma. The focus of that book is on Disruptive Innovation, where a new upstart with some new tech/angle crushes your business. A lot of your notes/principles here are captured in that book concisely.
2. One thing that is useful for employees to understand is how their company creates and executes on a strategy. It's crazy to me how many guides there are on strategy when most individuals do 0 strategy setting. The result is that you think of a great strategy, get shot down for whatever reason, and just grumble about how the "execs don't get it". It's much more fruitful to understand how the big dawgs are setting their strategy and what models they're using, and then you can figure out how to operate and innovate in that context.
3. Your comments on insight and research reminded me of Charlie Munger's talks on Mental Models. The basic idea is that you learn from a bunch of disciplines and your brain starts to tie things together and you'll produce insights. Shane over at Farnam Street (https://www.farnamstreetblog.com/mental-models/) has a great guide and intro.
Overall, I enjoyed reading your post and am impressed by the level of research. Great job.
1. Good call-out. Agree and would strongly encourage anyone in this space to read Innovator's Dilemma.
2. Could not agree more with this (and have seen a lot of first-hand pain here). One of the biggest generators of employee anxiety is simple uncertainty, and uncertainty is a product of inadequate visibility into and/or understanding of how and why things are happening. That's again one of the reasons why I feel every org/team needs a framework like V2MOM, because that's a hierarchical structure for documenting and communicating a strategy in a way that gets employees participating in its development, execution, measurement and refinement.
3. +1 here too. I link out to the Farnam street post in mine.
okay I have a system and structure..why am I not as successful as Henry Ford or Russell Simmons or Bruce D. Henderson. Luck plays a huge role, imho. The survivorship bias is huge. It's easy to review the winners and then work backwards to derive a 'theory', after the fact, as for why they were successful...it's like an interpolation polynomial.
Paul, thanks for the comment and I agree with you: luck and timing are two external factors that have significant influence on the outcome, and strategists have little if any control over either. The only "counsel" I can provide is the idea of being as iterative as possible, and try to adapt / respond to the result (test => observe => refine). If you had $10 to bet on the same probability outcomes, rather than betting all $10 on one outcome, if you could play it by putting $1 on 5 outcomes and reserving the remaining $5 to double down on your highest probability winner, you're much better-positioned, statistically, to come out ahead.
For those who, like me, didn't know what the Kelly criterion was: In probability theory and intertemporal portfolio choice, the Kelly criterion is a formula used to determine the optimal size of a series of bets.
> okay I have a system and structure..why am I not as successful as Henry Ford or Russell Simmons or Bruce D. Henderson.
Because your system and structure is not good as theirs were. It is not luck, it is competence. Not survivorship bias, but you overestimating yourself.
Highly recommend checking out the podcast Exponent and the blog Stratechery, both by Ben Thompson. He is a great analyst and both Exponent and Stratechery focus on the intersection of tech and business strategy.
I listened for a couple episodes, but when they started talking about machine learning it became obvious how little they understood it. With how willing they were to confidently opine on how it would change industries based on an incorrect understanding, I lost confidence in the other things they talked about.
True. They did the same in other technical subjects(UberPool and travelling salesman), so this is probably a repeating theme for them. And in the same episode, they didn't even do a survey of similar startups solving the same problem(which carries big implications on market structure), so it's not just a matter of technical subjects.
via((@ridewithvia) manage to do true ride sharing very well. they fill 8 seater vans. they don't use freelancers, but employees, and they license their software(and practically their model) to cities and other organizations.
Market structure: i can see workplaces(or maybe big events) licensing via, keeping control of the user, and offering free ride services from home/work to the cheapest transportation bidder, for example. Thus workplaces will keep all the "network effect" and market power.
The best strategies are built on top of great insights. Generally, I'd consider a strategic insight to be an understanding of “the true nature of something” (a customer need, market dynamic, or future trend) and/or its relationship to other important environmental factors. There's also a forecasting component to insights. Strategic insights commonly identify opportunity gaps in time — such as the difference between the current state of something and its anticipated future state.
One thought on the building blocks summary - I would add an Ideation phase after the Insights phase or somehow mention the importance of ideas. The current outline suggests strategy creation is a highly analytical process, when, in fact, it is both creative and analytical at the same time, and requires both sets of skills.
As a side note, you might want to check out the work of Victor Cheng who introduces a lot of McKinsey strategic tools in his book and video series. Could be helpful for your future work!
thanks Peter, appreciate the feedback. I kept ideation as part of the "Insights" phase but you're correct, it could be split into (1) research and (2) ideation. I'll check out Victor's work. best, Chris
Sort of conflates marketing strategy and corporate strategy, though there is overlap. The flow charts are vague enough to apply to any type of problem.
Marketing strategy covers anything related to sales/revenue, such as customers, products, channels or communications.
Corporate strategy covers long term business policies of a firm, and is best understood through an economics lens. Things like make vs. buy decisions, competitive advantage, market and industry analysis.
The belief that corporate strategy somehow exists separately or independently from marketing/sales/go-to-market strategy is not a good baseline assumption to operate from.
Sorry for the late reply. You are right that they are closely related, as revenue is a pretty important part of running a business.
But I find it useful to distinguish between them, as do most business schools. Mergers are part of corporate strategy that only somewhat involve marketing considerations. Advertising is marketing strategy that doesn't have much to do with corporate strategy. A decision to enter new markets would be in the overlap area.
Anyway I thought the original article was just vague consultant speak.
Few thoughts,
In my opinion, leaders communicate the mission, vision and values, but never clearly communicate the strategy.
The strategy for each department and team and it’s sub-teams with-in an org will be different. This has to be communicated at all levels to have the entire workforce work towards the single mission.
thanks. could agree more. communicating strategy is incredibly important and a gap that seems to happen often in companies. there's a big difference at the employee level between (a) a strategy that exists [somewhere at the executive/management level] and (b) a strategy that exists and is transparent, well-communicated and well-understood.
This is why I think a hierarchical, cascading V2MOM or OKR approach is a helpful communication vehicle to transfer strategy top-down and build consensus and participation in the strategy process bottom-up.
1. There are great insights in Clayton Christensen's The Innovator's Dilemma. The focus of that book is on Disruptive Innovation, where a new upstart with some new tech/angle crushes your business. A lot of your notes/principles here are captured in that book concisely.
2. One thing that is useful for employees to understand is how their company creates and executes on a strategy. It's crazy to me how many guides there are on strategy when most individuals do 0 strategy setting. The result is that you think of a great strategy, get shot down for whatever reason, and just grumble about how the "execs don't get it". It's much more fruitful to understand how the big dawgs are setting their strategy and what models they're using, and then you can figure out how to operate and innovate in that context.
3. Your comments on insight and research reminded me of Charlie Munger's talks on Mental Models. The basic idea is that you learn from a bunch of disciplines and your brain starts to tie things together and you'll produce insights. Shane over at Farnam Street (https://www.farnamstreetblog.com/mental-models/) has a great guide and intro.
Overall, I enjoyed reading your post and am impressed by the level of research. Great job.