Vantage Blog
29 Jul 2015
CHOICELESSNESS – THE SCOURGE OF BUSINESS TODAY
Insights and Tips from Roger Martin’s Sydney Playing to Win Seminar...Effective and successful strategy is all about making choices – what are you choosing to do and what are you explicitly deciding not to do. Based on Roger Martin and AG Lafley’s “Playing to Win” strategy framework, first developed within Proctor & Gamble, I have written before how effective this simple set of 5 questions is in developing and challenging strategy. Click here for an overview of the framework. Click here to download image of model.
On Friday July 23, together with 200 other business people, I was really pleased to be able to spend the day with Roger Martin. Roger has been ranked as one of the top 3 business thinkers of our time on the Thinkers50 list, a biannual ranking of the most influential global business thinkers. During the workshop he expanded on his framework and some of his thinking. His approach to the workshop, and how he interacts as a presenter, is a great example of Playing to Win in action – clear, concise and incredibly insightful.
I took away a number of ideas, insights and tips to help us all deliver more effective strategy…here’s a few of them
- Be Truly Distinctive. I notice that often people really battle to make truly distinctive choices on where and how they will play. It’s hard to argue that, say, being ‘customer focussed’ is not a good thing, but is it a powerful choice? Roger’s suggestion was to challenge each of your choices with questions such as “what would be the opposite of that choice?” and “ if someone else chose the opposite could it be effective and make money?”. For instance in the ‘customer focussed’ example what does not being customer focussed look like? It’s surely a hygiene factor today given successful strategy builds from deep customer insight.
- Make Real Choices. I often refer to the saying that there is no such thing as commodity products, just commodity marketers! The workshop gave me another angle on this one. To Roger, choicelessness is the scourge of modern business. For many companies their lack of making real choices has aggregated at an industry level and resulted in commoditisation. As a result the key driver becomes price. Benchmarking and offer matching ramps this up further. Real innovation is needed by forward thinking companies to break out of such a cycle.
- Shrink the Where. Instead of trying to cover multiple sectors, as part of your where to play choices, be deep and narrow. For instance target a dominant market share in a smaller group of sectors (and get the value benefit of being the leader). The need in some industries for scale or throughput may make that a challenge. However can that be achieved by having a two tier approach – i.e. sectors where you really play to win and gain competitive advantage, plus others where you just ‘play to play’, structuring your offer and costs to fit.
- Low Cost or Cost Equivalent. As Michael Porter’s seminal work identified you have to pick one. But which one? If you think you are low cost are you really? To Martin the real challenge was are you really not much more than just cost equivalent not low cost? That is, in his experience, the case in the majority of cases. He did point to P&G who, for instance, do have a scale benefit in the laundry detergent category but their investment decisions are based on maintaining differentiation as their core competitive advantage.
- The Innovation Challenge. Roger outlined a compelling view that the lack of real innovation in business is, in large part, due to the dominance of analytical thinking (e.g. making decisions, or not, based on an over reliance on numbers, analysis of lag data etc.) as the prime paradigm in business today. As analysis is invariably based on what has happened in the past, any performance improvement is incremental at best. In fact in some instances I believe this results in ‘paralysis by analysis’ and no innovation. His view is that this needs to be balanced with a focus on intuitive thinking (e.g. exploring what might be true, using judgement and EQ). To do that you need to accept and value 'judgement' as a critical business discipline because you can’t always access ‘proof’ via analysis. This balancing of analytical and intuitive thinking is the foundation of ‘Design Thinking’. This is expanded on in his book “Design of Business”; next on my reading list and suggest it should be on yours too.
- The Execution Trap. In his view the delineation between strategy and execution is a false one and, in fact, quite damaging. Every well functioning and successful organisation should be making choices at every level in what they do to deliver for their customers (internal and external). For instance, if you are a retailer where style and fashion are key to your strategic position the ‘choices’ sales staff make every day in serving customers will reflect how they interact – their level of advice on styling, their ability to proactively make outfit recommendations, how they themselves dress and present etc. Of course different levels of the organisation will be responsible for making appropriate strategy choices aligned to their level of insight and span of control. Strategy and execution are thus one and the same.
- Leadership Balance. He was asked about leadership in the context of strategy and choices and, whilst he certainly didn’t position himself as an expert, he had an interesting view. For him, great leaders are able to balance advocacy and inquiry. Advocacy is all about prosecuting your point of view, attempting to persuade others to your path. Inquiry comes from a different perspective – its based on genuine curiosity to find another way and to understand other’s perspective. It’s in the interplay that great strategic choices can be made. I think it is also heavily linked to the innovation challenge referred to above. Here’s a simple test: challenge yourself – what’s your ratio of advocating for a position versus inquiring to better understand (and advocating by questioning is just a wolf in sheep’s clothing!)? I think he probably has quite compelling views on leadership but that wasn't the focus for the day.
- Making Time for Thinking. We have more information and data than we know what to do with (in a meaningful way) but spend less time thinking than ever. I agree! And being ‘busy’ has become the new currency for many executives. This has created a viscous cycle as busyness becomes the excuse for not having time to think…and so it continues.
He also gave an insight to his current research project “Talent and the Future of Democratic Capitalism”; he is two years into a five-year journey. Fascinating and will keenly watch as it unfolds -but that’s a story for another day!
As you can see lots of thought provoking insights and ideas – and simple to apply in the strategy choices we all make in our businesses.
by James Atkins, Vantage Strategy & Marketing.
As you can see lots of thought provoking insights and ideas – and simple to apply in the strategy choices we all make in our businesses.
by James Atkins, Vantage Strategy & Marketing.