Playing To Win
How I Do Strategy — Part One
Getting Started Right
I had a Zoom with a likeable strategy fellow traveler (that is you, Brian) last week and he challenged me to do something that he argued I haven’t done. I have taken up his challenge in this two-part Playing to Win/Practitioner Insights (PTW/PI). The first part called How I Do Strategy: Getting Started Right. And as always, you can find all the previous PTW/PI here.
His Challenge
He is clearly a PTW/PI aficionado and is happy to quote me chapter and verse of my stuff — which is fun for me. His line of reasoning made me somewhat queasy because it put me in a position of flirting with being braggartly — he disagreed. But I will assert my queasiness as I proceed.
His assertion is that I have been highly successful in pursuing strikingly successful strategies in the organizations for which I have held leadership positions, plus more that I have influenced as a strategy advisor with clients (many of which are cloaked in confidentiality). He cited Monitor Company, Rotman School, Skoll Foundation and (his favorite) Tennis Canada in his argument.
And he gave me credit for providing lots of helpful advice on how to do strategy in my writings — particularly this PTW/PI series. However, he asserted that the thing I haven’t written specifically about is how I personally go through the process of creating a strategy when I am in a leadership role. That is true. I have provided snippets of that in the context of other PTW/PI pieces but not the whole thing.
So, I will do it. I will take the first-person approach — this is how I thought my way through the Monitor Company, Rotman School, Skoll Foundation and Tennis Canada strategies. In all cases, it was not me alone (e.g. at Monitor, CEO Mark Fuller played the biggest role). I played a role in each — some more central and individual than others — but I will just give my thinking through what I think of as the four major steps that I follow every time I do strategy. This piece will go into detail on the first two and part two will cover the third and fourth steps.
1) Get Myself Psyched Up
Brian (and others) have noted how aggressive the strategies in which I have been involved have been. Monitor — fundamentally change the way strategy consulting is done. Rotman — make it Canada’s one globally relevant business school. Skoll — define, shape and build the field of social entrepreneurship. Tennis Canada — transform Canada from an also-ran into a leading tennis nation.
These aren’t just aims be better than average — even to be really good. They are goals to be utterly transformational. For that, I need to get myself psyched up. If I wasn’t in the right mindset, I could never aim that high in strategy — and wouldn’t do it.
I do two things to get psyched up.
a) Project Forward the Current Path
I start by taking a cold, hard look at likely future progress along the road on which we are currently traveling. That is, if we keep doing what we are doing, where will we most likely be in five-ten years.
For example, at Monitor onlookers judged the likelihood of us surviving infancy as likely as pigs flying and history was rife with strategy consulting firms that appeared, stagnated and disappeared while giants McKinsey, BCG, and Bain roared ahead into the distance. If we tried to follow their lead, we would likely be left utterly in the dust.
At Rotman, we were already hemorrhaging current tenured professors and unable to hire junior tenure stream professors — they laughed at the low salaries we could afford to offer. And as of the time I started as Dean (in 1998), I could see the storm clouds gathering for business education. Industry capacity had expanded dramatically from under 10 thousand MBAs graduating per year in 1960 to over 100 thousand by 1998, diluting the flagship MBA degree, yet tuition levels had been racing ahead of inflation for decades. And online was just starting to threaten. If I scrolled forward, it was not clear Rotman would be one of the survivors of the world I saw coming.
At Skoll, we had an enthusiastic and rich donor with a huge desire to change the world. However, with only a $1 billion endowment (sounds like a lot but it means being able to spend about $50 million/year), if we didn’t find a tight strategy, we would spread our resources across a vast array of causes and dissipate all of our energy, leaving us like the innumerable zombie foundations who have done just that.
At Tennis Canada, it had been so long since we had notable professional tennis players that we were no longer attracting great young Canadian athletes to the sport, and if they did try to pursue a professional career, we didn’t have the resources or the skills to help them succeed. That put us outside the top fifty tennis nations in the world — hardly how a rich, prosperous G7 country should be ranked. The countries that had developed a reputation for producing top tennis stars were seeing their funding increase, allowing them to draw in the best coaches, even causing players to switch countries to them. That happened to Canada when the best male player we had ever produced, Greg Rusedski, left Canada in 1995 to play for the UK where he peaked as the #4-ranked player in the world (at that time, we had never previously had a top 50 player). The leading tennis nations got richer thanks to the successes of their players, while the lagging countries, like Canada, got relatively poorer. Our standing was likely to worsen over time, not even stay stably poor.
Projecting forward helps me to recognize that it is not worth it to pursue a strategy to ameliorate a bad situation. That would likely reduce misery but not eliminate it.
b) Remind Myself of the Inherent Goodness and Fairness of Most People
When your strategy is weak, the actors in your world aren’t particularly generous with you. If your offering is mediocre, customers won’t be loyal, competitors will attack you, and investors will shy away from you and/or badger you. But that is not meanness, it is fairness. However, if you have a weak strategy for a long period, you will come to believe that actors around you are mean and unfair.
But if you treat your customers well and your employees well, and your suppliers well, etc., they will reward you with their business, their loyalty, their support. Are there exceptions? Certainly. But the mean and unfair people prove the rule — that most actors in your economic system are good and fair.
As I embark on strategy, I remind myself that the job of my strategy is to encourage them to bring out their goodness and fairness — and I can count on that if my strategy is truly and obviously worthy.
2) Focus on the Problem to be Solved
At this stage, I do three things every time.
a) Focus Like a Laser on the Problem to be Solved
Strategy is not a thing that you need because you learned at business school that you are supposed to have one or your board says it needs to approve one. Rather, strategy is a problem-solving technique. When you are facing a problem, strategy is the tool you use to make that problem disappear.
Thus, to apply it usefully, you need to have a problem that you want to solve. Problems are a result of your historical choices interacting with the competitive environment. The only way the problem will go away is if you make a different set of choices. But to be useful, that different set of choices needs to respond to a precisely defined problem.
So, I spend a lot of time on defining the problem.
At Monitor, it was obscurity. Boston Consulting Group had a 20-year lead on us, and Bain & Company a 10-year lead. McKinsey jumped into strategy consulting between the time BCG created the industry and Bain got started but had been building a brand reputation for half a century. If we weren’t special, we would never overcome our obscurity. At Rotman, we didn’t matter. I used to (sort of) joke that if a meteorite came from the sky and obliterated Rotman (at night so no one was hurt), very few people would shed a tear. We weren’t meaningfully important to anybody. At Skoll, we had a rich and enthusiastic donor who wanted to support social entrepreneurship, but we couldn’t even define what it was or wasn’t — just that we thought whatever it was made the world a better place. At Tennis Canada, we were so used to losing that had lost both the will and the know-how to win.
b) Specify the Form of the Desired Outcome
Equally, I spend time on specifying the form of the desired solution to the well-defined problem. If you don’t have an objective function, any strategy alternative would appear plausible.
At Monitor, it was distinctiveness that would cause clients to seek us out. At Rotman, it was becoming so useful that people would be devastated if we disappeared. At Skoll, it was to lead in defining a field that we and others could then support. At Tennis Canada, it was to become a leading tennis nation.
Note that at this point in my thinking, there isn’t yet a strategy to make any of those outcomes possible, nor even a specific Winning Aspiration. Rather, I specify the box in which the Winning Aspiration will need to fit. That will help me avoid wasting time on possibilities that are not likely to end up with an outcome in that box.
c) Remind Myself What I Don’t Control
Before I dive in, I remind myself what I do and don’t control. First and foremost, in the don’t control category, is customers. My job is to make an integrated set of choices that influences them to take desired action. I can’t delude myself into believing that I can make them do anything. The same holds for employees. This isn’t the era of indentured servitude. They will work for whomever they choose. And the same holds for suppliers, distribution channels, partners, and governments.
I control and can pull a limited number of levers — so I need to pull them in a coordinated and compelling way. That is my job. It does remind me of a scene from one of my favorite movies of all time, The Princess Bride, in which our heroes make a list of the assets they can leverage in their improbable quest.
Practitioner Insights
As I have progressed in my career, I have become ever more convinced that the preparation for strategy choice is as important as the choice itself. When I say ‘preparation for strategy,’ the reaction of most is that I must mean a SWOT analysis or some such thing — i.e., a big analytical exercise to get all the pertinent facts on the table. That couldn’t be further from the truth.
The preparation is almost entirely between my ears. Lots of it is imagination — imagining how the future will unfold under a status quo set of choices, imagining how customers and employees will react under better circumstances than today, imagining problems overcome, and imagining that I can compel other actors to choose to play the part I would like them to play.
For me, that kind of mental preparation provides a solid foundation for bold strategy choice; strategy choice that transforms and produces something that is truly memorable.
Up next week is the back half: imagining possibility portraits and making/enforcing/adjusting choices.
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As a reminder, I am doing a PTW/PI podcast series with friend Tiffani Bova. The eleventh in the series will be on LinkedIn here on Wednesday, August 6th at 12 noon EST and 9am PST. I look forward to seeing you there.
