Strategic Planning Analogy #520: Whiteout!

THE STORY
I’ve been suffering through this winter like most everyone else here in the United States. A couple of days ago, it was snowing and blowing so bad that we had “whiteout” conditions.

A whiteout occurs when there is so much snow blowing in so many directions that you cannot see anything but a wall of “white.” It’s like being locked in a totally dark room where you can see absolutely nothing—except instead of total blackness, you have total whiteness.

I’ve been caught in whiteouts when driving on expressways. It is extremely dangerous because not only can’t you see the road, you cannot see what the other drivers on the road are doing. You may as well be driving blind.

THE ANALOGY
Businesses can also experience a form of whiteout. Except instead of being blinded by snow, they are blinded by an excessive flurry of data. With unending streams of data flying from all directions with no end in sight, it is easy to get lost.

There are those who say “the more data, the better.” But like snow, too much data can be a dangerous thing. It can overcome businesses and make it impossible to find the way forward. One can become so bogged down in looking down at data that looking up to make forward progress comes to a halt.

THE PRINCIPLE
The principle here is that obtaining data should not be the goal. The real goal is to discover and reach your vision. Data is only useful in this endeavor if two things occur:

1.     It is converted into knowledge:

a.      Insight to help discover the vision;

b.     Insight to deliver the promises of the vision; and

c.      Monitoring knowledge to make sure you are on track.

2.     It does not bog down forward progress towards your strategic destination (paralysis of analysis).

In other words, if all you have is a big pile of data, you have nothing. In fact, it is worse than nothing because of all the wasted time and effort to gather it and stare at it. Instead, what you want is a smaller pile of knowledge.

Knowledge is like a small map you can take in your car telling you where to go. The knowledge map is useful because it distills the vast outdoors into just what you need to motor along. By contrast, data is like all that snow that is still blowing around outside. Instead of giving knowledge of where to go, it prevents you from knowing where to go.

We can learn three things about how people deal with snow to help us understand how to deal with data for strategic purposes.

1. Look at Radar, Not Individual Flakes

If you really want to understand how to deal with snow, you need knowledge. And what knowledge is that? As I’ve stated in previous blogs, strategic knowledge of the environment usually boils down to three things: Magnitude, Direction & Speed. If you know this about a trend, then you typically know what strategic action to take.

For example, household car ownership in the US peaked in 2007. The current direction in the percentage of households owning cars is moving down. If we add to this the best knowledge on the anticipated magnitude of this trend (how low will car ownership go) and the speed (how fast will ownership drop), then we can build an intelligent strategy to deal with this trend.

The same is true of snow. If you know Magnitude (size of the storm), Direction (where it is coming from and where it is going) and Speed (how fast the storm is moving), then you will know how to deal with that snow storm. This is what the TV weathercasters talk about—magnitude, direction and speed—because they know this is the knowledge you need to make the right decisions.

They don’t get this knowledge by looking at individual snowflakes. In fact, they don’t have to really look at any snow at all. Instead, the weathercasters get this knowledge from understanding the big picture. And the big picture comes from looking at radar images rather than snowflakes. Radar captures the entire storm at once and lets you measure magnitude, direction and speed.

Strategists need to do the same. They need to stop obsessing with individual data factoids and look at strategic radar which lets one see the big picture—big enough to show direction, magnitude and speed.

You won’t get the big picture on car ownership by staring at everyone’s driveway one at a time. You need to get broader—and look at something other than cars and driveways. For example, what are the key “driving” forces behind choosing not to own cars. Is it:

1.     Population migration to dense urban centers?

2.     A different attitude towards car ownership among younger adults?

3.     A growing concern for the environment?

4.     A poor economy?

5.     Advances in car sharing options (like Zipcar)?

6.     Less need to travel due to being able to get tasks done at home via the internet?

7.     A combination of the above?

Get the big picture on this (via strategic radar), and you can start to make educated projections on the direction, speed and magnitude of car ownership. Now you have knowledge instead of data.

2. Plow Away the Unneccessary

Snow on the roads is considered a bad thing. Therefore the plows are brought out to clear away the snow on the road. The drivers of the snowplows do not stop to examine every snowflake on the road to determine which ones are good and which are bad. No, the drivers previously determined that if it is on the road, it is bad and needs to be plowed away. No further examination needed.

The same is true in business. A lot of data is strategically worthless. Its speed, direction and magnitude have no relevancy to advancing my strategy. Therefore, rather than spend time examining it, I should just plow it away so that I can move forward.

For example, Walmart’s strategy centers around owning the low cost, low price position. Therefore, Walmart can focus their attention on only dealing with finding knowledge of issues impacting Walmart’s ability to own the low price position.

When Walmart determined that:

a)     Warehouse clubs and supercenters had the potential to offer lower prices than Walmart discount stores; and

b)     Consumers were starting to prefer these formats (direction, speed and magnitude moving their way),

Walmart changed its strategy and diversified into warehouse clubs and supercenters.

Recently, they made the same determination about internet shopping and are quickly and aggressively moving in that direction.

Everything else was plowed away so that they could focus on what really mattered—owning low price. By knowing where to focus, they could ignore and just get rid of all the debris that does not impact that focus. This allows Walmart to efficiently and effectively own its position over many decades.

That is why focus is so important to strategy. Focus lets you know what to look at and what you can ignore. As I mentioned in a prior blog, it is often more important to know what your strategy isn’t than what it is, because there is a lot more data which is worthless than is worthwhile. Defining what is outside your strategy lets you know what is worthless and can just be plowed away.

3. Fly Above the Clouds

No matter how bad the snowstorm, airplanes can usually avoid the turmoil by flying above the clouds. It’s always sunny and snow-free above the clouds. And that leads to quick and easy travel to the destination.

A similar situation exists in the business world. Current business fads and daily crises can cause all sorts of turmoil. Bouncing from fad to fad or crisis to crises is like bouncing around in a jet going through a storm. It slows you down and keeps you from your intended destination.

Strategists need to get companies to rise above these current temptations which suck up a company’s time, just like jets rise above the clouds to escape turmoil. Once you get above the clouds, you can see clearly. The same is true in business. If you stop getting bogged down in the petty distractions of the moment, you can see more clearly what is truly important.

Rather than follow the current fad, follow the larger game plan. After all, one rarely wins a strategic position when following others to get to the same location as they are. Winning comes from differentiation, not imitation. Rise above the fray to clear the path to your intended destination—the place where you can win.

SUMMARY
Although some data can be useful for strategy, most is just a wasteful distraction. And even the useful data only becomes useful if it is converted into knowledge. Therefore, instead of wasting time trying to absorb as much data as you can, follow the tricks used to deal with snow:

1. Focus on the Big Picture by looking at “Strategic Radar” (showing direction, magnitude and speed) rather than looking at every snowflake (piece of data).
2. Just plow away all the data not relevant to your task of moving forward towards your winning point of differentiation.
3. Fly above the clouds of current fads and distractions so that you can easily see the final destination.

FINAL THOUGHTS
Remember, the winner is not the one who captures the most data, but who gets to the right destination first with the right offering. Don’t let competitors in snow plows pass you by while you stop to look at every snowflake.

Strategic Planning Analogy #483: Execution

THE STORY
Let’s say that you are the coach of a sports team.  Your biggest game of the season is coming up, so you devise a masterful plan beforehand on how to win the game.  After writing up the plan, you become very proud and say to yourself, “This is a brilliant strategy.”

Yet, when it is just before game time, you tell the players on your team, “Each of you go out there and individually do whatever you think is right.”  So that is what the players do during the game.

And I’m sure you know what the result would be.  There is no coordination among the players or agreement about what to do.  As a result, they suffer a terrible loss.

THE ANALOGY
There is a reason why sports teams have coaches and why those coaches develop game plans.  Without the coach and the game plan, the players on the team would play in a random, uncoordinated fashion.  They would have no success.  Yes, they may all individually be great athletes, but if they are not executing a common strategy, they will fail.

To win in sports, you need more than just great athletes.  You need a plan to win and a coordinated execution of that plan.  For example, a great pass is only “great” if there is someone who knows it’s coming and is in the right place and ready to receive it.  And that only happens if it is planned and practiced.

As the saying goes, there is no “I” in TEAM.  It is about working a common plan together.

This may sound obvious for sports teams, but it appears to be less obvious in the business world.  There is a great movement to “empower” the people on the front lines of business.  The idea is to just give them the proper tools and get out of the way.  Let them do whatever they think is right.

Sure, the gang up at headquarters may have some fancy strategic plan enshrined in some book or Powerpoint deck.  But if the people on the front lines aren’t aware of the plan, or not trained in what the plan means for them, or are told to just “do whatever you think is right,” then that plan is worthless.  You become just like the coach in the story who designs a great strategy but doesn’t use it while the game is being played.  That type of planning is worthless.

Yet this worthless approach seems to go on quite often in the business world.  Those designing the strategy and those executing the strategy rarely interact.  They may talk about the strategy once a year at an off-site location nowhere near where the actions of the business actually takes place.  Yet, the rest of the year, when the daily execution of decisions takes place, the topic of the strategy is rarely ever brought up.  This creates a disconnect between what the company says and what the company does.

And you know what?  It is what you do on a daily basis out in the marketplace which determines your success, not what is dreamt up back at headquarters.  So if you want to win, you need the team to be playing the game you designed beforehand.

THE PRINCIPLE
The principle here is that the real strategy is not what you say, but what you do.  What you say is just an idea.  By itself, it has no value, no impact on one’s success.  Instead, it is what you do which impacts your success, because it is the only thing that gets played out in the marketplace where the battle is fought.

Therefore, if you want to win, you need three things:

1. A winning game plan (a great strategic plan).
2. A team capable of executing the plan (the right skills, infrastructure, investments, competencies, supply chain connections, etc.).
3. A team that has been coached so that they have the knowledge, ability and desire to execute the plan while the game is being played. 

We’ve talked a lot about the first two points, so we will focus the rest of the blog on point #3. 

Knowledge

You cannot execute what you do not know.  If a player does not know what is expected of them, it should not be a surprise when they do not do what you want.  If the only people who know the strategic plans are the executives on the sidelines, then don’t be surprised when those on the front lines of the business do things contrary to the strategy.

Yes, you may have great, caring, action-oriented people in your company who want to the right thing.  But if there is no consensus on what is right, then they will all be doing different things—none of them evil per se, but none of them coordinated to build upon each other to deliver the plan.

Therefore, make sure everyone knows what the plan is.  You probably even want your customers to know what the plan is, so that they can hold your people accountable to it.  Heck, why not tell the whole world, including your competitors what your plan is.  If it’s a well designed strategy and your people are executing it well, it shouldn’t matter.

Vince Lombardi, the great coach of the Green Bay Packers in the 1960s, said that he wanted his teams to execute so well, that even if the opposing team knew exactly what you were going to do, they still couldn’t stop you.

Wells Fargo has created success with a superbly executed plan to win via cross-selling.  Now it’s one thing to say “we will win via cross-selling.”  It’s another thing to have a sophisticated plan executed everywhere in the organization to pull it off.  As Wells Fargo CEO John Stumpf put it recently, “We could leave our strategic plan on an airplane and it wouldn’t matter.  It’s all about execution.”

So don’t be afraid to tell the whole world your strategy, especially the people who have to execute the strategy.  And do it often. 

And do it specifically.  In sports, each player not only needs to know the overall game plan, but the specific game plan for their position.  Have you told everyone what is expected of them as their part of the game plan?  Do you even know what each person’s part is in executing the plan?  Shame on you if you haven’t broken down the strategy to a level where people can see where they fit in.  Don’t assume people will figure it out on their own.

Ability

Knowing what is expected does not automatically imply that you can flawlessly execute the plan.  That is why sports teams practice between games.  Through instruction, training, repetition and feedback, the players become better at their role.  That way, when game time comes, they are better able to execute the plan.

This same principle applies to business.  Don’t just tell people what is expected.  Help train them so that they can better execute on what is expected.  How many businesses have employee training programs specifically developed around strategic goals and objectives?  You’d fire a sports coach who didn’t train his team to execute the plan.  Why should we settle for less in business?

Every day, there are dozens, if not hundreds of decisions being made by each person in the organization.  Are each of these decisions helping to promote the strategic intent or are they moving in a different direction?  The strategic coaches cannot be there when every one of these decisions are being made, so the coaches need to train everyone so that it becomes a natural reflex to decide in the direction of what’s right for the strategy.  Have some training sessions where you go through common situations, to help everyone see what the best decisions for action are.  

Desire

Finally, one needs people on the team who want to execute the plan.  You need team players who buy into the culture, buy into the objectives, and buy into the general strategic approach for achieving those objectives.  Effective leadership can help build up that desire. 

Unfortunately, we’ve all seen great athletes who are not team players.  They tend to hurt, rather than help performance.  Are you willing to deal properly with those who don’t have the desire to be a team player? 

But What About Improvising and Adjusting?

Now we all know that the future is uncertain.  Things will happen that we did not anticipate.  But that is not an excuse to stop planning and stop trying to connect execution to plans.

Sport events have the same problems.  Unexpected things happen.  Perhaps a key player is injured, or the opposition is stronger than you anticipated.  That doesn’t mean teams abandon planning and play randomly. 

No, instead sports teams make adjustments to the plan.  They don’t totally abandon their macro plan, because they are stuck with the players and the training they already have.  But mid-game they adjust the plan to make it more suitable for the game of the moment.  And if they were trained well, they have practiced some alternatives for just such occasions.

The same is true for business.  It is okay to adjust the plays mid-game (adjust, not completely throw away).  And if you have practices various scenarios in advance, you are ready to adjust quickly when the scenario changes.

Finally, the idea of empowerment is not a totally bad concept.  In fact, it is mostly a good concept, especially when things are changing.  But it needs to be empowerment bounded by strategic intent.  In other words, one is free to improvise as long as it is consistent with the overall strategic imperatives for that individual.  The sports analogy would be that a player can adjust their play as long as it is consistent with the game plan for their particular position on the team. 

And the more you train and practice the strategy, the better that improvisation will be.

SUMMARY

Your real strategy is not what you say, but what you do.  Therefore, any strategic planning process needs to emphasize strategic execution—doing the things which move the strategy forward.  In order to accomplish this, one needs to do three things: 

1. Have a great plan.
2. Have a team capable of executing the plan.
3. Have a team that has been coached so that they have the knowledge, ability and desire to execute the plan while the game is being played. 

This requires making sure everyone knows the plan (and their part in it), is trained to do what is needed to execute the plan, and has the desire to play their part.

FINAL THOUGHTS
How often do your strategy people ever get out in the field to see the game in action?  You wouldn’t dream of leaving the coaches at home when a sports team goes out to play a game.  Is it any less wrong to never let the business strategists be at the game in the marketplace?