Which Strategy is Right for My Company? Part 4- Generating Ideas
Previously, in “Speaking the Same Language,” we looked at how hard-to-see perspectives on information can cause hard-to-understand disputes. We saw how to get to consensus, as opposed to compromise, by clarifying values and measures of success.
Here we’ll go beyond defining success and start on where and with what you will achieve success.
Your strategy will achieve success in the market(s) where your company competes.
You can think about a market as an industry, which focuses on products and producers (airlines). You can think about a market as a customer need or segment (business travel). It’s sort of like longitude and latitude: even though we can slice it vertically or horizontally, it all adds up to the same single Earth.
Competition occurs for customers, and they don’t care about industry boundaries. You may compete directly with companies offering a different solution. Think of streaming video versus Blu-ray and DVD.
At one level all customers have something in common; e.g., they all regularly breathe oxygen. Too broad, not useful. At another level all customers are unique; e.g., their combination of name, date of birth, DNA, and name of first pet. Too narrow, also not useful. Somewhere in-between there’s a reasonable way to specify, to “target,” a group of customers to whom you want to sell your product and that has a need for (i.e., seeks a benefit from) your product. That’s what I’m calling a market.
In your company you have at least one product. (I mean “product or service” when I say “product.”) If you have more than one product, you may combine them into a product line. In a business (or “strategic business unit,” a.k.a. SBU) you have at least one product or product line. If you have multiple businesses you might organize them in divisions or groups. Your company holds it all.
Some strategy decisions are for a business, others are for a company. Roughly speaking:
- Business strategies produce and market products, possibly competing with other businesses. It’s where you interact with customers, set prices, devise marketing campaigns, develop new products, run factories, and so on.
- Company or portfolio strategies balance the businesses within the company, including growing, shrinking, starting, closing, buying, and selling businesses. It’s where you interact with investors, set goals, etc.
The distinction isn’t quite so stark in practice. For example, companies have marketing (think of General Electric’s image ads) and R&D programs that benefit multiple businesses. Also, in single-business companies the company is the business and the business is the company. So, when I say “company” I’ll mean it in a generic sense. You may read it to mean “company” or “business” as needed.
Three sets of ideas
Generating strategy starts with generating sets of ideas. (You may need more or fewer.)
First, ideas for your company. You need them partly so you can choose your strategy from a good list and partly so you don’t let yourself get attached to what you’ve done so far.
Second, ideas for your competitors. They don’t want to sit still any more than you do. Anticipating their moves and motives helps you choose your strategy well.
Third, ideas about the future scenarios, or just “futures,” in which you may find yourself. We’ll cover scenarios in the next installment.
Here are some ways you can start generating strategy ideas:
- “We’ve had great success with highly custom products. What should we do next year?” Such a statement, even if true, may unconsciously tether you to the past. Notice the difference: “Will we continue to succeed with highly custom products, or do we have a better option?”
- Every time you look for reasons why something will work, also look for reasons why that same something will not work. The point is not cold-water negativity. The point is to prevent overconfidence and uncover hidden gotchas.
- SWOT (strengths, weaknesses, opportunities, threats) analysis is not hugely effective at stirring up creativity. But try this: after you list all sorts of strengths, weaknesses, opportunities, and threats, cross out “strengths” and write in “weaknesses.” Cross out “threats” and write in “opportunities.” Etc. See where that takes you.
- Use a process like the one from Powernoodle.com, which 1) reduces the influence of loud, dominant people, 2) makes it easy for quiet people to get their ideas on the table, and 3) shows ideas anonymously.
- Bring in someone who focuses on ideation, or learning games, or business war games.
- Shake things up by asking your team “what has to happen for this strategy idea to succeed” and “what could cause this strategy idea to fail.”
View Part 1 of the Series – What You Want
View Part 2 of the Series – What They Want
View Part 3 of the Series- Speaking the Same Language
Coming up next
There are generally plenty of ideas for what your company can do and for what your competitors can do. In the next installment we’ll finish generating ideas by talking about the many — and I do mean “many” — scenarios in which your ideas may compete.
About the author
Mark Chussil is Founder and CEO of Advanced Competitive Strategies, Inc. and a 35-year veteran in competitive strategy. He has designed strategy simulators and conducted business war games for dozens of companies, in many industries, around the world, helping them make or save billions of dollars.
A highly rated and entertaining speaker, Mark speaks about strategic thinking at conferences and in corporate workshops. He has written three books, chapters for five others, and numerous articles, and he has been quoted in Fast Company, Harvard Management Update, The Wall Street Journal, and other publications.
Mark is also a Founder of Benefitics, LLC (which quantifies Social ROI for non-profit organizations) and a Founder of Crisis Simulations International, LLC. He earned his B.A. at Yale and his M.B.A. at Harvard.
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