THE STORY
Wednesday, May 29, 2013
Strategic Planning Analogy #502: Judo Strategy
THE STORY
Wednesday, March 23, 2011
Strategic Planning Analogy #383: Showing Up (Part 2)

BACKGROUND
In the last blog, we began a discussion around strategic success. We said that strategic success requires more than just having a great vision and a great plan. One also needs to have employees united around making that plan a reality.
Unfortunately, people do not always naturally unite around a plan. Due to different thoughts and agendas, there can be differences of opinion. People may not see a reason to fight for plan. In fact, some may want to sabotage the plan.
Strategies typically involve change. Not everyone sees the benefit in change. Many will resist change.
Unless you deal with these roadblocks of resistance, your strategy will die before you have a chance to implement it. Therefore, a key part of the strategic process is working to get everyone on board, to show up and be committed to the plan.
In the last blog, we looked at three areas where roadblocks can occur (Motivation, Beliefs, and Perspective). In this blog we will look at four more.
MORE POTENTIAL AREAS FOR ROADBLOCKS
4. Goals
In a race, people run towards the goal. If there is a disagreement about what the goal is (or should be), then everyone will be running in different directions. For a united effort in a singular direction, you need an agreement on what the goal should be. So what should that goal be?
One way to choose a goal is to say “We should do what is right.” Although this sounds good, it is actually a terrible goal. The problem is that it assumes there is only one right thing and that everything else is wrong. This causes people in a discussion to focus on trying to prove that everyone else is wrong. And of course, nobody wants to be proven wrong, so they fight back to prove you are wrong. This leads to discord rather than unity. In the end, nobody wins.
Worse yet, this assumption just isn’t true. There are a lot of divergent points of view which are all “right.” It is right that a company focus on the crisis of today. It is also right that a company focus on tomorrow. It is right that individual departments need to fight for their needs. It is also right that sometimes departments need to give up something for the good of the whole company. It is right for a company to provide financial returns today for its stakeholders. It is also right for a company to invest money for the future. And the list goes on and on.
Therefore, instead of fighting for what is right (and what is wrong), a better goal is to “do what is best.” This way, everyone can save face in the discussion, since their positions are not necessarily viewed as wrong. They are still right—but just not the best right thing to focus on at this time. Instead of attacking, people are comparing.
So how do you determine what is “best”? As I mentioned in the last blog, I am adapting many of my thoughts from the writings of Chris McGoff. McGoff suggests that groups choose between three methodologies:
a) Ends-Based: Best = What Does the Greatest Good for the Most People.
b) Rule-Based: Best = The Best Universal Standard
c) Care-Based: Best = Best Outcome for the One Most Impacted by the Decision
After choosing a methodology, the best goal tends to be rather apparent to most people.
At this point, another roadblock can appear. That is the roadblock of then assuming that you need 100% agreement on this decision (or any other decision) before moving on. An old friend of mine who used to do consumer research liked to say that if you survey a large enough population, you will always find 5% who will believe almost anything. His point was that there will always be a fringe group holding divergent views. They will never be swayed to change their mind. If you wait for 100% agreement, you will be waiting forever. That is not the path to winning in the marketplace.
Therefore, instead of having a goal of 100% agreement, strive for a goal of having 100% willing to live with and commit to the decision. If you want people willing live with and commit to a decision, McGoff suggests two principles:
a) Have a process which people agree was explicit, rational and fair.
b) Make sure everyone in the discussion was treated honorably and that their points were heard and considered. The good news is that switching the orientation from “right” to “best” tends to help with this principle.
5. Balance and Separation
As we noted above, there can be multiple truths in an organization. Many of these multiple truths appear to be bi-polar opposites:
a) Individual/Department Needs Vs. Corporate Needs
b) Near-term Concerns Vs. Long-term Concerns
c) Improving the Current Business Model Vs. Transforming to a New Business Model
d) Analysis Vs. Action
The goal is not to only do one pole and not the other. Instead, the goal is twofold:
a) Find a balance of time between the two poles. Both need an adequate share of your time. For example, if all your time is spent on Analysis, you will never get anything done (paralysis of analysis). Conversely, if you only spend time on Action, you will likely do the wrong things because there was no prior analysis.
b) Make a separation of time between the two poles. Don’t try to work on both of them at the same time. The conflicting objectives will create chaos.
If a discussion hits a roadblock, it can often be because the balance or separation is not working. Either one of the poles has been ignored for too long or the discussion is confused because both poles are being worked on at the same time. Check to make sure that the principles of balance and separation are not violated.
6. Focus
Not everything is bi-polar. There are some things which deserve far more time than others. For example:
a) Focus on what you can control (Empowerment) instead of what you cannot control (Victimization)
b) Focus on The Future (What we can do to improve) rather than The Past (Where we can place blame)
c) Focus on that which impacts our stakeholders rather than that which is just internal bureaucracy.
d) Focus on what advances the Vision.
e) Focus on Results.
Perhaps your roadblock can be fixed by getting more on focus.
7. Culture
What you tolerate becomes your culture. If you tolerate bad behavior, you will get bad behavior. The bad behavior will take over your culture. However, if bad behavior is not tolerated, then it is less likely to dominate your culture.
It is harder to reach unified commitment if people do not trust each other and there is no respect for each other. Toleration of gossiping, back-stabbing, lying, slander, and irresponsibility are a poison to any strategic discussion. You cannot discuss in good faith when you have no faith that there is any good.
If discussions are bogged down, perhaps it is because a poisonous culture has gripped your company. Remember, culture is determined by what is tolerated, not by what is on a piece of paper. Enron had a great culture on paper, but it tolerated poisonous behavior. To eliminate a poisonous culture, you need to have severe negative consequences for bad behavior (including termination). This roadblock can take awhile to fix.
SUMMARY
To be a success, you need more than just a great strategic vision and a great plan to achieve it. You also need to have your employees united around making it a reality. If the employees don’t show up with enthusiasm to achieve this common purpose, the rest of the work is a waste of time. There are seven roadblocks to achieving this employee commitment to the plan. In today’s blog, we looked at four of them:
• Goals – Seek what is Best rather than what is Right; Seek what people can live with rather than 100% agreement.
• Balance & Separation – Balance significant time between both bi-polar truths; Focus on each pole separately (at different times).
• Focus – Focus on what you can control, the future, what advances the vision, what impacts stakeholder, and results.
• Culture – Don’t tolerate poisonous behavior.
FINAL THOUGHTS
It’s hard enough to compete in the marketplace when all your resources are put into the battle. Don’t make it worse by handcuffing your people with unnecessary roadblocks.
Tuesday, March 13, 2007
Keep an Eye on the Ball
As I said in an earlier blog, I know a lot of Vince Lombardi stories after having lived in Green Bay for 10 years. Vince Lombardi was a firm believer in discipline and in mastering the fundamental basics of football. He used to say that his definition of a great football team is one which executes the fundamentals so flawlessly that even if the opposition knows exactly what play you are going to run, they cannot stop you.
There was a time when one of his teams did not seem to share in Lombardi’s passion for mastering the fundamentals. After a particularly bad game in which the team did a poor job of executing the basics, Vince Lombardi decided that the team needed to relearn the fundamentals of the game. Therefore, he ordered everyone to show up the next day for a lecture and practice session in the fundamentals of football.
The next day, Vince Lombardi gathered the team around him so that he could lecture them. He started off by placing his hand up in the air so that everyone could see what he was holding. Then he started his lecture by saying, “For those of you that don’t know it, this, my friends, is a football.”
THE ANALOGY
Just as great football teams continuously spend time mastering the basic fundamentals of the game, so must businesses. Basic fundamentals like pleasing the customer and following through when others are depending on you never go out of style. Sometimes, however, we can get so caught up in the razzle-dazzle of our strategy that we can forget to execute on the basic fundamentals of business. Just having a great strategy is not enough. You have to deliver what the strategy promises every single day.
Sometimes a football player can get so caught up in doing their little part that they can forget the big picture and lose site of where the football is. At the end of the day, if you don’t know where the football is, you cannot win games. The team needs to keep their eyes on the ball.
The same is true for businesses. You need to keep an eye focused on the basic fundamentals of your business in order to win.
THE PRINCIPLE
In yesterday’s blog I made reference to the need for balance between personalization and standardization. Then we talked about the importance of personalizing your strategy around your unique capabilities. Today we will talk about the other half of that balance—the need to get the standard fundamentals of business executed properly.
I can best illustrate this principle with another story. I know a retired professor who used to hold the Kresge Chair of Retailing at the University of Michigan School of Business. Because of his position in holding the Kresge Chair of Retailing, he got to spend time over the years with the executives at K Mart.
Back in the late 1980s and early 1990s, K Mart was run by a gentleman by the name of Joseph Antonini. Joseph Antonini was a smart fellow who understood what was going on at K Mart and developed a pretty good strategy for the situation. At the time, K Mart was still very profitable and creating lots of cash flow. But Antonini knew that as more Wal-Marts invaded K Mart turf, that cash flow would eventually start to vaporize. Therefore, he devised a two-step plan.
1) First, put a little money back into the K Mart stores to freshen up the image, so that they would continue to put out cash for a little longer length of time.
2) Take the remaining money and invest in a portfolio of all of the new and exciting growth retailers who were building various kinds of specialty superstores. Antonini was busy on this front. Some of his diversifications included:
- Builders Square Home Improvement Centers (like Home Depot)
- Pace Membership Warehouse (like Costco)
- Borders Books (like Barnes and Noble)
- Sports Authority (Sporting Goods Superstore)
- PayLess Drugs (Drug Store Superstore)
- K Mart Supercenters (like Wal-Mart supercenters)
The rationale behind the strategy was that about the time K Mart would stop being a cash cow, these other formats would be strong and take their place. Antonini saw real estate development as one of K Mart’s core competencies, so he figured he could quickly grow these concepts into large chains and end up with a strong a portfolio of the next great retail concepts.
In theory, the strategy sounded fine. In reality, it was a disaster. The diversifications languished under K Mart management, and the refurbishment of the K Mart stores was executed poorly.
Eventually, Antonini confided to my professor friend that he had no problems coming up with great strategies, but he couldn’t find anyone in the K Mart organization competent enough to bring them to life. In other words, the strategies were fine, but the organization was inept at the basic execution of retail fundamentals. Without attention to the basic details of running a strong business, the strategy died a horrible death.
Was Antonini wrong in his vision of a small refurbishment program for K Mart? Well, he was correct in assessing the fact that Wal-Mart would eventually strangle K Mart’s cash flow. He was correct in not betting it all on a costly remake of the chain, for K Mart would never outlast Wal-Mart. But putting a little money in to provide a little more payback for the diversification sounded sensible.
Was Antonini wrong in his diversification vision? Well, other companies made a fortune building chains in the same formats he diversified into. Home Depot and Lowes are huge successes in home improvement centers. Barnes & Nobel is doing well, and so is Borders, once it was freed from K Mart management. There are successful sports superstores out there as well. So Antonini was not wrong in seeing the potential in these formats.
What killed K Mart was the fact that it was out of balance. It had found the “right” strategy, unique for its position and real estate skill set. However, it had failed miserably on developing the standardized tools for successful execution of retail formats. K Mart had taken its eyes off the ball and could no longer execute the fundamentals.
There were rumors that K Mart had gotten fat and lazy during its glory years of the 1960s and 1970s and had forgotten how to be a lean, mean retail fighting machine. It had fallen into the trap of believing that just because it built stores in the right format, that it would automatically be successful. No, you still have to excel in the fundamentals, every day. Just “showing up” is not good enough. You have to be ready to play at a high level.
This principle is true in football and true for businesses as well. Just because a team won the Superbowl last year does not mean that they “have arrived” and can slack off the following year. The basic execution of blocking and tackling that Lombardi stressed in the 1960s is still important today. You can never get sloppy on these fundamentals and stay on top.
Now some people make the mistake in believing that because getting the fundamentals right is so important, that the only thing they concentrate on is getting the fundamentals right. Doing so gets you just as out of balance as what happened to K Mart, only in a different way. The problem is that situations change. Consumers change, technology changes, economies change, government regulations change, competition changes, and so on. Eventually enough change occurs in the environment that a once successful strategy will no longer be appropriate.
ALL STRATEGIES EVENTUALLY FAIL. If you do not modify your strategy and adapt to the changes, YOU will eventually fail. You may have perfected the execution of your particular strategy, but if the strategy becomes obsolete, it really doesn’t matter. That is why you need a balance between getting the basics right (standardization) and modifying your strategy so that your capabilities are uniquely in tune with an important part of the changing realities (personalization).
So to be successful, it helps to keep one eye on the ball of the game you are currently playing (as referenced in today’s blog) and one eye looking in your refrigerator to see what new dish you can create for the next strategic challenge (yesterday’s blog topic).
SUMMARY
A “great” strategy poorly executed is really not a very good strategy at all. The business world is too competitive. Someone else will adopt a similar strategy and out-execute your business, leaving you at a loss. Getting the big picture strategy right is only part of the goal. You still have to do the little details well.
At the same time, just doing the little details well is not good enough either. There needs to be an ever evolving big picture strategy to ensure that you are excelling at things that are still relevant in the marketplace.
FINAL THOUGHTS
When a person loses their balance, they tend to fall down. When a company loses its balance, it can also fall down…and it probably won’t be a gentle landing.
Thursday, February 22, 2007
Art AND Science
THE STORY
About a year ago, I got a phone call from a headhunter. She wanted to know if I would be interested in a position at one of the world’s largest retailers. I’m always polite to headhunters and told her I would be interested if there was a good fit between myself and the company.
The headhunter started to ask me some questions. Eventually, she asked me a hypothetical question about what I would do if the environment had changed and I needed to change the strategy of the company. I basically told her two things:
1) First, in a retail chain that large, I would always have a handful of stores experimenting with new ideas and tactics, so that one can constantly learn about what can and cannot work for the company. Then, when there is the need to change, you already have gathered some data through these experiments to help you decide how to change.
2) Second, I would take some decisive action, but I would remain alert and flexible about how the consumer is reacting to the change. I would monitor consumer reaction through research and creatively improve and modify “on the run” as I rolled out the change throughout the chain.
At this point the headhunter stopped me and said that I was definitely not the type of person the company was looking for. I asked why not and she said it was because of the way I answered that question. She said this company definitely did not want somebody who experimented or creatively modified their approach. They were looking for someone who already knew exactly what to do in every future situation and would just order the troops to quickly carry out the program. She explained how the company’s culture was very militaristic and how there were looking for people who would bark out clear orders like a general and expect the employees to obey the clear orders like good soldiers.
After hearing that, I agreed that there was not a good fit for me as an employee at this company. I did, however, offer to solve their problems as an independent consultant. The headhunter, admitting how difficult it was to find the type of candidate the firm was looking for, said “You’d be amazed how many people made the same offer you did.”
THE ANALOGY
A dear friend of mine likes to say that “business is an art that uses scientific tools.” To stay ahead in business, one needs to creatively think outside the box and move in new directions. This is the art of business. No amount of pure science can get you there. At the same time, however, scientific research is needed to provide a fundamental baseline of knowledge. Without this scientific knowledge, the creativity becomes random and can lead you astray. Therefore, you need both art AND science to effectively build the strategies of success.
In the story above, the company trying to hire someone apparently did not have the patience for either art or science. They did not like the idea of scientific experimentation or consumer research. To them, this was a sign of weakness that you were not already smart enough to know the answers. So science was out at this company.
In addition, they didn’t like the artistic approach of evaluating the situation at hand and coming up with a uniquely creative solution for that particular problem. They also didn’t like someone who was flexible in implementation, creatively adapting as new data came in. Again, they saw this as a sign of weakness that you didn’t already have a one-size-fits all solution that could easily be mandated to the troops. So art was out at this company as well.
This may help to explain why investors were losing confidence in this company and why the CEO of this company recently left the firm. The investors realized that without art and science, this company would have significant difficulty dealing with the problems that inevitably arise from the changing environment. Strategies are more than just barking out orders. They are creative, artistic approaches based on the knowledge from scientific learnings.
THE PRINCIPLE
The principle here is one of balance—a balance between artistic creativity and scientific research. If you get out of balance, your strategies could easily lead you astray. Here are some of the risks when you get out of balance.
1) All Science, No Art: The Risk of Moving Backwards
I had a boss once who only believed in “fact-based” decision making. He wouldn’t do anything unless all the facts were in. He lived by the flaw of embracing science, but ignoring art. There are three flaws to this imbalance:
- You cannot scientifically measure that which does not yet exist. Trying to create the strategy of the future requires moving in new directions. Studying the past may not tell you the whole story of how the future could unfold. It is like driving forward while only looking in the rear view mirror. Eventually you drive into a tree.
- Studying what is working today is like benchmarking the best-in-class competition. It may help you become almost as good as what the current leader is doing, but it won’t help you find a unique point of differentiation. You will only be seen as a close, but inferior version of the leader.
- If you wait to move until all the facts are in, it may be too late to stake a claim in that future. Others will jump in with less than full science and own the position before you begin. All you end up doing is chronicling someone else’s success.
Nearly all great innovations have come from inspiration, and they were not something that customers were clamoring for in research. People have a hard time articulating that for which they have no experience. Your job is often to find what people desire before they realize it.
2) All Art, No Science: The Risk of Moving Sideways
Some people have great intuition and artistically guess very well (or so it seems). Therefore, you may think you have the “golden gut” as well, and when your get tells you to move in a certain way, you do so—without any scientific investigation. What usually results is randomness, rather than effectiveness. What we often do not realize is that usually the people we admire as great artists are actually also great observers of human nature. Although their studies may not be formalized science, it is scientific observation none-the-less.
Art alone can be easily swayed by emotions and fads. You may end up chasing every fad and end up nowhere in particular. Science is needed to divide the fads from the true trends. Studies have shown that the TV advertisements which win the most awards for creativity are often among the commercials least effective at moving products. Science is needed to focus the artistic energy in a successful direction.
3) No Art, No Science: The Risk of Perfecting the Obsolete
This is the example of the company in our story. These are the people who think there is a “one-size-fits-all” trick that works in every situation. That trick could be:
- Cutting Costs
- Six-Sigma
- Balanced Scorecard
- Decentralize the Centralized (or Centralize the Decentralized)
- Etc.
No need for scientific scrutiny. No need for creative thinking. Just pull out your favorite trick and put it into action. Granted, these types of activities can have some impact and may make you more efficient or more effective at what you do. Unfortunately, if your basic go-to-market strategy is wrong or inappropriate for the times, all you have done is perfect the obsolete. At some point, enough change will take place in the marketplace to cause your underlying strategy to fail. These tricks don’t help you find the next strategy.
SUMMARY
Effective strategy is all about getting the proper balance. You need some scientific insights to ground your decision making, but you don’t want to get so bogged down in research that you never get around to taking a leap forward in a distinctive direction. Artistic inspiration is also an essential element, but in isolation, inspiration may run you down the rabbit trails of every fad. Productivity tricks are also useful, but they only make good strategic decisions better. They do not create the good strategy. Remember, business is an art that uses scientific tools.
FINAL THOUGHTS
The only way to get an effective balance of art and science is by creating a culture which encourages both. I never could have brought that balance to the company mentioned in the story, because their military culture would not allow it. Culture must change first. Let’s hope the new CEO of that company can effectively change the culture.
