Strategic Planning Analogy #374: Black Bananas

THE STORY
Large grocery chains in the US purchase their bananas from the fruit companies in the unripened “green” stage. They do this because hard, green bananas are easier to transport to the US.

Then, after the green bananas get to the US, the grocers put them into their produce warehouses. These warehouses have gigantic, pressurized gas chambers in them. These gas chambers chemically “ripen” the bananas. Depending on the length of time the bananas stay in the gas chamber, you can “manufacture” whatever level of ripeness you want. After they reach the desired ripeness, the bananas are shipped by truck to the grocery stores.

One company I know wanted to increase efficiency by shipping both bananas and flowers to the stores on the same truck. Unfortunately, something unexpected happened. The flowers arrived at the stores already starting to wilt and die—something which hadn’t happened when the flowers were shipped by themselves.

Upon further investigation, it was determined that some of the ripening gas which was infused into the banana via pressure (while in the gas chamber) started to leak out of the bananas when they were in the truck. This ripening gas was absorbed by the flowers while they shared the ride in the truck. As a result, the ripening process of the flowers was accelerated, causing them to die prematurely.

As soon as the company figured this out, they stopped carrying the flowers and bananas on the same trucks.

THE ANALOGY
Bananas and flowers are called “perishables,” because they have a short life. They soon “perish,” or die. You cannot stop a banana from turning black. You cannot stop a flower from wilting. It is inevitable, and it happens rather quickly.

Although we may not want to admit it, strategies are also perishable. Every strategic initiative eventually dies, just like bananas or flowers. And like those flowers in the truck, our strategic initiatives often die faster than we had hoped.

The reason strategic initiatives die is because the environment in which the strategy operates changes. Consumer desires change, technology changes, competition changes, innovation changes, the economy changes, and so on. These forces of change act on the strategy like the gas in those gas chambers. They cause the strategy to move through a lifecycle until it is no longer relevant and dies.

Think of the travel agents, whose strategy of being an intermediary between travelers and the travel industry died when the internet allowed travelers to interact directly with the travel industry and buy their own tickets. At that point, the old travel agent strategy lost most of its relevance.

Think also of Kodak, which is struggling to find a new strategy now that its old strategy, based on analog photographic film, is no longer very relevant.

Strategies based on growth in established economies are currently being replaced by strategies focusing on emerging markets. And retailer JCPenney this week announced it was shutting down its catalog operation, a strategy made irrelevant due to the internet.

In a similar fashion, some day your strategy will also become irrelevant, if you do not adapt. It will turn black like a banana, perhaps before you are ready to move on.

THE PRINCIPLE
The principle here is that since all strategies eventually die, a good strategist should try to proactively manage this process. Just as the grocers can manage the life a banana via the gas chamber, strategists can manage the life of their strategy via various tactics.

In particular, we will look at three areas to consider.

1) Managing the Gas Pressure
There are many things businesses can do to hasten the growth of a new business. You can increase advertising, lower prices, do a public relations push, expand distribution, get celebrity endorsements, win awards, go viral on You Tube, etc. These act like those gas chambers act on bananas, because they push your business from early entry to maturity.

In many ways, this is good, because it quickly increases your market potential. However, just as all that extra gas caused the flowers to prematurely die, too much early pressure to grow can cause your strategy to die more rapidly.

Consider the high fashion industry. A lot of the appeal of high-end fashion brands has to do with their exclusivity. The more you push to expand the market into the middle class, the more you destroy that exclusivity appeal. Soon, the high end customers will abandon the brand because of that tarnished image. And once the high end abandons the brand, the middle class will soon follow. The brand dies an early death. Had less pressure been put up front, the fashion brand might have had a longer, more prosperous life.

Hence, too much pressure up front can push what could have been a lucrative long-term trend into a less profitable short-term fad. However, too little pressure may cause your strategy to never get beyond the introductory stage. Therefore, strategic planning needs to consider what is the proper amount of pressure to apply.

2) Keeping the Pipeline Full
Supermarkets do not make just one large purchase of bananas per year. If they did, they would have two major problems: a) a lot of the bananas going black before getting sold; and b) there would be no bananas to sell in the later half of the year once all the black bananas are thrown away. To avoid these problems, supermarkets buy small batches of bananas all year long. By having a continual supply of fresh bananas coming in all year, they can optimize sales and reduce waste.

The same is true for strategies. Companies need a continual pipeline of strategic innovation, experimentation and development That way, a company is ready when its current strategy begins to die and can seamlessly move on to the replacement strategy. One of the keys to the long-term success of GE has been its ability to continually modify its portfolio in order to remain relevant. It has moved through heavy industry to financial services to entertainment and is now moving to green energy. It does it seamlessly because GE built an infrastructure specifically designed for seamless transitions by focusing on:

a) Great general management (regardless of the business);
b) Mastering portfolio management techniques; and
c) Merger & Acquisition expertise (to help shift the portfolio more effectively).

It’s hard to quickly shift a strategy from a focus on mature markets to a focus on emerging markets if you have never experimented in emerging markets before. That’s why a strategy 100% focused only on the “strategy of the moment” can be so risky. It leaves you vulnerable when the strategy of the moment begins to die. Precious time is lost in transition, because you are unprepared and inexperienced in what comes next. You may not even survive the transition.

It is safer to be like the grocer who keeps the pipeline full of fresh product all the time. Otherwise, you can be like Kodak, who was so focused on photographic film that it did not build up an adequate pipeline of post-film strategies while it still had the time and the cash flow. Now, Kodak is struggling to catch up and it may not make it.

3) Exit Early
I’ve seen supermarkets try to sell black bananas. It’s not a pretty sight. They try to hide the ugliness of the bananas by putting them inside brown paper bags. They put a sign next to them saying something like, “Black Bananas; Perfect for Making Banana Bread.” Then they give it a very low price. And it still won’t sell.

You’d find it difficult to even give away black bananas for free. They just aren’t very desirable.

The same can be true for your strategy. Once a strategic initiative turns black and is dead, almost nobody wants it. You cannot sell it at any price. You may even have to pay somebody to take it off your hands.

As I’ve mentioned in prior blogs (here and here), holding onto a strategy after it turns black is a bad idea. Just as it is better for a supermarket to get rid of a banana when it’s only starting to turn brown, it’s better for a company to dispose of a dying strategy when others can still see a little life in it.

Many companies make the mistake of hanging on to a dying strategy too long. Emotional ties or historical heritage make it hard to let go. However, waiting until the strategy turns black hurts everyone. It is almost always better to error on the side of exiting a strategy a little too early than sticking with it a little too long. The value plummets too quickly at the very end.

SUMMARY
All strategic initiatives eventually die. If you don’t want your company to die along with its strategic initiative, then you need to occasionally adjust your strategy. To optimize the return over the life of a strategy, a) manage the speed at which you pursue growth, b) maintain a pipeline of strategic alternatives, and c) exit dying strategies before it is too late.

FINAL THOUGHTS
Just as it was wrong to put bananas and flowers together on the same truck, it is usually wrong to manage mature and emerging strategies in the same way. They have different needs, so you have to approach them in a different way, with different benchmarks and expectations.

Strategic Planning Analogy #247: Pendulocity

THE STORY
I went to a science museum once that had a huge pendulum dangling from the ceiling. These are called Foucault Pendulums. The weight on the pendulum had a small point at the bottom, which slightly dragged through a sand pit. When the pendulum swung back and forth, it left a tiny etched trail in the sand ground showing the path it had taken.

With a pendulum that big, it could go back and forth for hours—seemingly forever. One would think that the pendulum would move in a straight line on its many travels back and forth. Hence, there would be only a single straight etched line in the sand.

However, this is not the case. Slowly, over time, the pendulum starts making curved etches in the sand. How can this be? It looks like the pendulum is going in a straight line. And, in fact, it is going in a straight line. So why is the sand line curved?

The problem is that the earth is rotating underneath the pendulum. The pendulum is indeed going back and forth in a straight line. It is the ground the sand is on that is moving with the rotation of the earth. This is called the Coriolis Effect.

THE ANALOGY
Just as a pendulum goes back and forth, from one extreme to the next, so does public opinion and behaviors. Sometimes people as a whole are optimistic, sometimes pessimistic. Sometimes they want to spend lavishly, sometimes they prefer to be frugal.

Remember what it was like shortly after the events of 9/11 in 2001? People said they were changing their outlook and perspectives on life. They said they would be less materialistic and care more about their families and the people around them. They said they would think about the larger issues and go to church more. They talked as if this was a permanent change to their lifestyle that would last until they died.

Well, it wasn’t more than a few years later that we had one of the largest growth rates ever in the sales of premium luxury branded items. People were spending so much that we had negative savings rates. Attendance and interest in traditional churches dropped to among their lowest levels. Superficial celebrity gossip magazines and web sites were hotter than ever.

And now, after the economic meltdown, things are going back. Conspicuous consumption is out again—frugality is back. People are talking about the importance of family again.

This is just the pendulum of life going back and forth, back and forth. And this is the environment in which you must develop your strategy.

THE PRINCIPLE
The principle here is something I call “pendulocity.” This is the combination of the words pendulum and velocity. The idea is to remember that world trends, like a pendulum, are always moving back and forth—from one extreme to another.

Sometimes, the velocity is relatively fast, as we saw in the shift from optimistic spending before 9/11 to conservative frugality after 9/11 back to optimistic spending and now again to conservative frugality. That’s quite a few swings of the pendulum in a decade.

Other times the swing is a lot slower. Back in the 1960s, the military was held in low esteem by many in the US. Soldiers coming back from Vietnam were ignored or booed. People went to great measures to avoid service, and the career path of the military was looked down upon by many.

Now, soldiers are viewed as great heroes, getting cheering crowds when they come back. Many are proud again to volunteer for military service. This swing from one extreme to the other took decades.

So not only do you have to consider the direction of trends, but also the speed.

There are three factors in particular about pendulocity that are important to strategy formulation.

1) The Pendulum is always in Motion
When a pendulum swings out to an extreme, it never stays there. It soon starts coming back. The same is true in the marketplace. Lately, I read reports of “experts” saying that the current recession is causing a “permanent” new reality. All those people trading down to shop at Wal-Mart are expected by experts to continue that behavior once things get better. Experts say the new frugality is a permanent behavior change for society.

Yeah, yeah, yeah. I heard things like that after 9/11 and at other swings of the pendulum in that direction. Guess what...it is temporary. The pendulum will swing back. These are not permanent changes to behavior.

Don’t build a strategy that only works at the extreme of the pendulum or needs the condition to be permanent, because that condition is temporary. I remember that at the peak of the low-carb diet craze, someone was building a strategy around supermarkets that only sold low-carb food. It failed miserably, because by the time the first store opened, the low carb craze was already waning. The pendulum was moving back to a different diet craze.

There may always be a niche at the extremes, but the masses move back and forth. The changes are less permanent than you think. Remember that when developing strategies.

2) Anticipate Rather than Chase
One of the problems with the low-carb supermarket strategy was that the concept was chasing a trend that had already peaked. When chasing a pendulum, it is hard to catch up, because it is always in motion. By the time you see the peak and react to it, it may be too late. The pendulum is moving to another location.

The better strategy is to look at the direction the pendulum is going before it reaches the extreme. By anticipating the flow of the pendulum, you can get out in front of the trend and be ready before the peak. Hockey player Wayne Gretzky claimed that much of his success was due to the fact that he did not skate to where the hockey puck was, but rather to where the puck was going. He anticipated the future state of the puck and went there. So should you.

This is why trend monitoring is so important. It allows you to prepare in advance by getting early warning signs.

Early in the life of Best Buy stores, Best Buy put nearly all its effort behind one or two new technologies at a time, like microwave ovens and VCRs. When a technology is new, consumers tend to behave in a particular direction. They desire a store with extra service and expertise, to help them understand the new technology. Hence, they go to specialty stores and are willing to pay a little extra for the expertise.

However, once people get comfortable with a technology, they are less interested in expertise, and more interested in low prices. They shift their purchases to a discount store.

This was a predictable pendulum swing, from a specialist like Best Buy to a discounter like Wal-Mart. After experiencing it a few times, Best Buy founder Dick Schulze said he would never again run a retail concept dependent on a single type of product, because he always go burned when the trend swung away from him.

Instead, the idea was to abandon technologies early—not try to chase every possible sale, because that would be a losing battle against the discounters. Instead, Schulze would anticipate what was the next ascending new technology innovation and become the early leader in that. Then, he was in the right location when the new technology peaked.

3) The Pendulum Curves
The pendulum appears to curve, because the conditions of the ground below it are changing. The earth is always in motion, causing the pendulum to end up in slightly different places on earth each time it goes back and forth.

The same is true of the marketplace. It is in constant flux and movement, like the rotation of the earth. Therefore, when the pendulum swings back, it will not be in exactly the same location as the last time is swung back.

Each time the consumer trends swing back, the conditions will take a slightly different form. It won’t be exactly like it was the last time. There will be some variations. Therefore, one cannot just drag out the old strategy when the conditions come back. It will need to be adjusted for the changing nuances caused by the rotation churn along the way.

SUMMARY
Nothing stays the same forever. Conditions change back and forth, like a pendulum. To be in the right place at the right time, one needs to know where the pendulum is going and make the proper adjustments.

FINAL THOUGHTS
The world is not a still photo. It is a moving video. If you develop a strategy around a single still photo (i.e., assume everything is frozen in one location or use only one data point), you will develop the wrong strategy.

Strategic Planning Analogy #238: Anchor Your Boat

THE STORY

Every month I have to change a bunch of passwords at work for email, voicemail, access to data, etc., because they expire.  And I can't change them to something easy to remember.  The passwords have to contain letters, numbers and symbols, and I cannot repeat a password I've used in the past year.  It's maddening!

 

Just imagine how much worse it would be if your other forms of identification also expired every month.  What if each month you had to come up with a new first name, last name, home address, email address and phone number?  You'd probably be spending half the month setting up your new residence, getting new government paperwork for your new name, setting up new phone service, and so on.  Then, for the rest of the month, you'd be trying to contact all of your friends to let them know your new name, where you live, and how to contact you. 

 

Of course, if all of your friends are also changing identities every month, you wouldn't know how to contact them to tell them about your new identities. 

 

All of your time would be spent trying to establish your life, leaving no time to live your life.  After awhile, all the names and numbers would blur together in your brain. You wouldn't even remember your own name, because it no longer has any special meaning to you…it's just another in a long line of names.  Here today, gone tomorrow.

 

My parents had it easy.  They lived in the same house together for about 50 years and had the same phone number over that length of time.  Their identities were solid and easy to remember.

 

THE ANALOGY

Stability and continuity in one's personal identity can be a good thing.  First, it is easier to remember (for yourself and for the people you want to stay in contact with).  Second, your identity becomes stronger and more special, because its power hasn't been diluted through constant change.   Third, it allows you to spend less time on creating your identity and more time on living out who you are.

 

Although we can easily see the benefits to keeping our personal identity factors constant, I have seen many companies abandon this idea when it comes to the identity of their brand, company or selling proposition.  On a regular basis, they change their logos, their advertising slogan, their market position, their CEO and all manner of things relevant to their identity.

 

Maybe it's due to boredom.  Maybe it is out of the desperate hope that a change in identity can be a catalyst for improved performance.  Regardless of the reason, the result of constant change in business tends to be disappointing.  People get confused (both inside and outside the company), the power of the brand is diluted, and corporate resources are diverted to identity change rather than serving the customer.

 

THE PRINCIPLE

The principle here is about strategic anchoring.  If you do not anchor a boat it will drift away and you will lose it.  However, if you anchor your boat in a known location, you can find it when you need it.  Just as boats need anchoring, so do strategies, or you company will drift away.

 

It's hard to get people's attention.  And when you do get it, you only get enough time for a soundbite or a Twitter "tweet."  Complex or subtle message find it hard to get through.  This applies not only to your customers, but to your employees. 

 

Therefore, when trying to communicate strategy, don't keep changing the context or the jargon.  Anchor it to something already embedded in the brain.  Look at the Balanced Scorecard.  Robert Kaplan and David Norton came up with the concept back in 1992.  Over time, Kaplan and Norton have come up with lots of new ideas and concepts for business beyond the original Balanced Scorecard idea.  Yet, they have not abandoned the identity they gained with the Balanced Scorecard. 

 

All of their new ideas are put inside the context of the Balanced Scorecard.  Why?  It is the identity already embedded in the mind of their audience.  It is a reference point understood by the audience.  It makes it easier to get their new concepts across in soundbites.

 

It looks like a similar situation is occurring with the Blue Ocean strategy.  W. Chan Kim and Renee Mauborgne came up with this concept back in 2004, but they are not letting it die a quick death.  They now have the Blue Ocean Institute.  All their current ideas and writings are put into the Blue Ocean context.  It is becoming the solid identity foundation to build upon.  It is their version of a Balanced Scorecard.

 

If Kaplan and Norton kept redefining their jargon and context every time they had a new idea, they'd be like the person in the story who keeps changing his location and name.  You'd be spending so much time just trying to connect to your audience, that you will not have time to persuade.

 

Worse yet, abandoning the old jargon gives the impression that the old ideas and concepts should be abandoned.  And if the author is abandoning the ideas, why should I pay attention to them?  Won't those new concepts be eventually abandoned just like the old?  If the ideas become obsolete quickly, then why pay such close attention to them?   Your audience will start saying, "These, too, will pass soon, so I can get away with ignoring this latest management fad."

 

 

Don't marginalize your ideas by turning them into the "fad of the month."  Make a stand.  Keep the identity solid over a long period of time…long enough that people no longer feel they can ignore it.

 

Just because your company has strategic planning meetings every year does not mean that your strategy should change every year.  A good strategy should last quite a long time with only minor modifications.  Continuity is a good thing.

 

The same applies to the jargon and concepts used to describe the strategy.  Continuity of terminology reinforces the position in the mind of the audience.  Employees are more willing to go out on a limb and fight for your strategy if they know it is going to be around for a long time.

 

Now this does not mean that strategies are cast in concrete, never to change.  Tweaks and modifications are part of the game.  But just because one has to adapt their identity does not mean you throw the old identity away.  Rather than moving to a new house every month, like in the story, just redecorate the familiar old house.  If you look at the Balanced Scorecard "house" today, it has been vastly redecorated from what it looked like back in the early 1990s.  But it is the same, familiar house.  The boat is still well anchored.

 

Sure, the professional strategist can easily get bored with the old languages and concepts.  To spice things up and look like you are contributing, a strategist can get excited by using the latest jargon and newest tools at each strategy session.  Just remember, you audience doesn't think about this stuff as much as you do.  At the point where you are getting bored with it all, it may just be sinking in and getting comfortable with them.  And they will not spend as much time as you do keeping up with all these new approaches.  You can easily lose them in the churn of changing approaches.

 

Now, in this blog I have done just the opposite.  Rather than pound on the same analogy, week after week, month after month, year after year, I've done a new analogy with every blog entry.  This blog is analogy #238.  That's a lot of change.

 

I recently tried to remember all of those analogies and I couldn't do it.  They all started to blur.  If I, the author, cannot remember them, then the audience hasn't a chance.  If I wanted to make a big splash, perhaps I should have stayed with my favorite analogy—Strategic Planning is Like Barbecue Sauce—and just kept pounding on it week after week, like my version of the Blue Ocean.

 

One analogy can be an important metaphor for use in planning.  But 238 analogies are more than anyone can fully absorb into their daily living.  Perhaps it is time for a new approach.

 

SUMMARY

Anchoring your strategy around a continuity of terminology has advantages.  It makes it easier to get your ideas across (common language).  It also keeps your ideas from being ignored as just a passing fad.  And besides, a good long term strategy shouldn't be changing all that often, anyway.  So why keep changing the jargon which talks about it?

 

FINAL THOUGHTS

Joseph Stalin used to say, "One death is a tragedy; one million is a statistic."  Even something as monumentally tragic as death becomes just a meaningless number when it occurs countless times.  If you want to have a monumental impact on your people, don't change your strategic language countless times.  That degrades it to a mere statistic.

Chasing Fads

THE STORY
Several years ago, back at the height of the popularity of the Balanced Scorecard, my company sent me to a Balanced Scorecard conference. There was a rather large crowd at this conference. Even so, the organizers wanted to find out more about who showed up, so they had us go around the room and tell a little about ourselves.

I was surprised to find out that the majority of the people who were attending this conference had job titles something like “Director of Balanced Scorecarding.” I had no idea jobs like that even existed. Even more interesting was the fact that their prior job titles tended to be something like “Director of TQM (Total Quality Management)” or some other similar management fad.

Apparently, these were professional fad jumpers. Whatever the latest management fad was, they would latch themselves to it and make a full-time job out of it. When the fad would start to wane, they would jump to the next fad and make a job out of it. They could spend their entire career playing with the latest management gimmick and never have a real job doing real things. They got to spend lots of time going to seminars to learn the fad. By the time management realized that what they were doing was just a fad, they would hopefully be on to the next new gimmick.

After I got back from the conference, the CFO asked me what I learned. I told him that all of the benefits claimed by Balanced Scorecarding could pretty much be achieved by management practices we already had in place. Sure, the nomenclature we used was different, the process was slightly different and the graphics looked different, but it would pretty much achieve the same results. I told him I saw no need to disrupt what was working for our company in order to mimic their jargon and graphics.

The CFO replied, “That’s pretty much what I thought.” And the Balanced Scorecard was never mentioned at our company again.

THE ANALOGY
Business management and business strategies tend to be very fad-ish. The problem with fads is that they consume a lot of time and energy for a brief period, but seldom lead to much of any lasting value. As seen in the story above, companies can create all kinds of jobs and infrastructure around a fad and get nothing but a career springboard to the next fad.

Worse yet, the distraction of the fad keeps people from being focused on what really matters. Rather than building solid strategies, time is spent building worthless mission statements using the latest fad buzzwords. Rather than focusing on outcomes, they focus on the process.

THE PRINCIPLE
After the dot-com bubble burst, management fads tended to have something to do with cutting costs. Eventually people figured out that you cannot cut your way to greatness, so the current fad has to do with innovation. Just look at the latest IBM television ads…they are all about innovation. This blog will use the latest fad of innovation to illustrate how fads can be counterproductive.

Consultants love fads because it can give them the ability to look like saviors—they possess the wisdom of the latest fad which can make you a success. If you would only hire them and pay them huge sums of money, they will share the wisdom of the latest fad with you.

So naturally, firms like McKinsey and Company want to look like experts in innovation. How do they do that? Well, in the case of McKinsey, they did a survey in September of over 1,400 business executives (I was one of them) and asked them their thoughts about innovation. (It reminds me of the old joke about consultants—they steal your watch and then tell you what time it is. Here, they are asking the people they want to consult with what they think before giving them advice.)

What McKinsey found was that about 70% of corporate leaders say that innovation is among their top three priorities for driving growth. So apparently the buzz word is in—people feel good about looking to innovation as the latest fad to save them.

However, the actions of these executives do not match their words. According to the survey:

1) Most executives do not talk about innovation in any meaningful way at executive and leadership meetings.
2) Most executives do not have their compensation tied to innovation.
3) Most executives claim their culture does not encourage innovation.
4) Most executives claim they do not have the right types of people for innovation.
5) Most executives claim they are not risk takers themselves and so by example tend to discourage innovative risk-taking in others.

So at this point, with that type of approach, one can pretty much guess what the outcome will be…there will be very little true innovation to come out of this process. Then executives will say “I guess innovation does not work. I guess I’ll have to look for some other way to save the company.” Then it’s on to the next fad.

Believing in the myth that by wrapping our arms around some fad we can magically bring prosperity to the company gives a false sense of hope. By clinging to this false hope, we feel less compelled to do the hard work of making our business better, one small tactic after another. Instead, we rest on the promise that the latest “whatever” will be so successful that we don’t have to worry about those pesky details any longer. In this case, the belief is that innovation will create so many new avenues for growth that it is okay to slack off a bit on the core business and let it crumble just a bit.

Worse case scenario, management has so much confidence in the magic of the fad that they don’t see the need to manage it closely and put in place safeguards to enhance the likelihood of success. It is seen as too powerful a force not to work all on its own. This may explain why the executives in the survey believe in innovation, but do little to enhance its potential within the company.

What the experts don’t like to mention is that most innovation processes are very costly and most innovations fail. Putting a greater emphasis on innovation also increases the risk profile of the company. Although risk has a lovely upside, it also has an ugly downside. A large focus on innovation may not be appropriate for your company’s strategy.

For example, if you are a large and powerful market leader, it may make more sense to be a “fast follower” than an innovation leader. For years, big leaders like Coke and Microsoft have let others take all of the expense and risk of innovating. Once someone else’s innovation looks promising (like diet cola or Netscape), these firms rapidly copy the innovation and then use all of their marketing might and muscle to win the battle for market share.

If your industry is in decline, there may not be enough demand to justify the expense of innovation. Price competition may be too intense and customers might not be willing to pay too much more for the innovation. Instead, it might make more sense to have a “harvest” strategy where you cut costs at a faster rate then the industry decline.

The point is that there is no one-size-fits-all magic bullet that is right for everyone. Every situation is different. You have to find the ideal strategy for YOU, not some generic strategy that kinda works for everyone. Remember, if you are using the same strategy as everyone else, how are you creating a positive competitive differentiation versus the competition? Finding what makes sense for your business requires setting aside the hype of the latest fad and digging in deep to find your unique edge. Strategic short-cuts rarely get you to your destination. They only send you on wild goose chases.

Now if innovation is the proper path for your firm, then put your money where your mouth is and do whatever it takes to be the innovation leader. Lip service is not enough. You need to change your entire culture to become more innovation-friendly. Don’t be like the executives in the survey.

SUMMARY
Every company is different. As a result, every company needs to develop its own particular strategy to take advantage of its uniqueness. Following the latest fad may give the fad-jumpers the next step on their personal career path, but it rarely leads to building a strong, vibrant corporation.

FINAL THOUGHTS
If you want to integrate new ideas into the heart of your business, it helps to elicit the time of operational leaders in the business. Getting operational leaders within the business to sponsor a process tends to work better than isolated professional “Directors of Scorecarding” who live on the periphery of the business and have no natural base of power (and typically are not well in tune with how the business really works).