Category Archives: Strategy

Not Just a Picture

“We have to find a purpose that has us?” Rachel was confused. “I’m not sure I understand. We are trying to do strategic planning for 2020. I get that we have to define our purpose. I know that purpose will drive the rest of the plan. But you make it sound like that purpose has to be some powerful compelling force. We bake bread.”

“Exactly!” I said. “What kind of bread do you bake?”

“Well, we bake all kinds of bread.”

“So, why do you bake bread?”

“I don’t understand.” Rachel’s head was moving from side to side. She wasn’t disagreeing, but she was having difficulty with the question.

“Why do you bake bread?” I repeated.

“Because our customers buy it.”

“And, why do your customers buy it?”

“Well, bread is consumed at almost every meal in some form or another. People eat a lot of bread. It’s a comfort food.” Rachel was trying.

“Why is bread so important to people?”

“It’s just part of life, bread goes with everything. It’s universal. Around the world, all cultures eat bread. When people get together, they break bread. It’s almost a bond between people.”

“And do you bake quality bread?” I asked.

“The best,” Rachel smiled. “Hot out of the oven, warm, soft, drizzle a little honey on it, just the smell of it makes you feel good.”

“Rachel, you are on the right track. Somewhere in what you describe is purpose. Somewhere in there is vision. Somewhere in there is mission.”

“It’s funny you should say that,” she said. “In the hallway is our mission statement, only it’s just a picture, of a steaming loaf of bread emerging from an oven door.”

The First Strategic Question

Why and which?” Rachel repeated. Come the first week in January, Rachel had to present her 2020 plan to the rest of her management team.

“How did you approach this plan last year?” I asked.

“I’m not sure, seems like we just got the group together and set some goals for the year.”

“Interesting. And, how did that work out?”

“It’s funny,” Rachel said. Her eyes wandered to the ceiling. “We never really looked at the plan again, until last week when I started thinking about 2020.”

“Did you accomplish any of the things you set out to do?”

“We knocked a couple of things off the list, but I have to tell you, some of the stuff didn’t even matter. It was really kind of vague.”

“So, why did you create the plan?” I asked.

“Because we were supposed to,” Rachel replied.

“So, you never really asked the question –why-?”

“Maybe, you are right, that is the first question.”

What Went Wrong?

“What do you think is the most difficult, planning or execution?” I asked.

“Planning is no slouch,” Travis replied, “but execution is where things go wrong. We may have a perfect plan, but we don’t have perfect execution.”

“Travis, sometimes I look at all the things a company wants to do, process changes, re-engineering, efficiency programs. They are all good ideas, yet, most fail. Why?”

“Execution?” pondered Travis.

“So, why did the execution fail? I saw the written plans. I attended some of the meetings. I observed the training. I watched the pep rallies. I saw the teamwork posters on the wall. I know incredible amounts of money, resources and energy went in to make it happen. In the end, not much changed. So, what went wrong?”

Travis hesitated, “Execution?”

“I saw team members trying new sequences, working with new equipment, handing off projects in new ways. But in the end, it didn’t stick. A new process would get shortcut. The old way worked faster. The enthusiasm faded into push-back. The word on the floor was, if we stiff arm it long enough, the re-engineering would go away. Morale plummeted. Ultimately, the initiative was abandoned. What stopped the execution?”

Travis wasn’t sure.

“Management focused all of their attention prior to the change. Little or no thought was given to how the new behaviors would be positively reinforced. What gets reinforced gets repeated. What does not get reinforced will stop. Dead in its tracks.”

Want to Build Your Business?

This is how it starts. In the beginning, the founder has an idea. This could be a hare-brained concept or even a hobby. (Some hobbies should stay hobbies.) But, the founder, not being able to resist, transforms the hobby into a business.

Admittedly, it is a little business, and who is doing all the work? The founder, of course. Is there work left over? There is always work left over.

So, the founder hires the first employees, mostly friends and family, because no one else will work for those paltry wages. And, what do these people do? A little bit of everything. The founder organizes the work around the people, asking what each employee (friend or family member) does well. “What do you do well?”

Indeed, there is some of that work to go around, and around. The work is organized around the people (scarce resources). Is there work left over? There is always work left over.

The strategic focus for this startup organization is all about sales. Without sales, this fragile organization dies. And, in the beginning, these don’t have to be profitable sales, because in the beginning, the founder puts all the expenses on a credit card, line of credit, whatever it takes to get the company off the ground.

This is proof of concept time. Is there a customer out there, anywhere, willing to buy our product or service, at any price. Why would a customer buy? There must be an angle, something unique. Oh, it must also be cheaper.

All of this requires energy and hard work. Success depends on it. The problem is, the just dessert for hard work is – more hard work.

What Will Your Company Be Like?

So, here is something I want you to think about. As technology is integrated into your business model, what does your company look like in five years, ten years? When we can measure all kinds of things in real time, in feedback loops with algorithms that detect meaningful change (or stasis), what does work look like?

Autonomous driving vehicles are tested and adopted in plain sight. The mining industry prefers autonomous machinery because accident rates have dropped to almost zero, component wear (brakes, tires) dramatically reduced, productivity dramatically increased.

What will happen to your company as you afix sensors to almost everything? Below is a little list. If you have something else you are measuring, let me know, I will add it. What will change in your business model? More importantly, what will be the new work created?

  • Physical Pressure
  • Air pressure
  • Barometric pressure (altimeter)
  • Humidity (air, surface, soil)
  • Temperature sensor
  • Fluid pressure sensor
  • Fluid flow sensor
  • Fluid position sensor – mechanical position
  • Fluid specific gravity
  • Fluid accumulation sensor (rain)
  • Vibration
  • Accelerometer
  • Photo pixel shift (movement)
  • Photo pattern recognition
  • Photo contrast (light-dark)
  • Photo color sensor
  • Bio – photo oximetry (SpO2)
  • Bio – fingerprint sensor
  • Electric current switch sensor (On-Off)
  • Electric current voltage sensor
  • Electric current resistance sensor (Ohms)
  • Electric current touch sensor
  • Proximity sensor
  • Infrared sensor (transmission – reflective)
  • Sound wave sensor (sonic, sub-sonic, ultra-sonic)
  • Smoke sensor
  • Gas sensor
  • Alcohol sensor
  • Temperature sensor
  • GPS sensor
  • Gyroscope sensor
  • Tilt sensor

Your five year thinking will be a one year tactical plan in four years? -Tom

What Keeps Us From Thinking?

There is an NLP (Neuro-linguistic programming) process that encourages the act of visioning. This imaginary exercise requires the subject to place themselves into a future state (point in time) without the encumbrances of the present. Encumbrances of the present limit the vision of the future and prevent the creative imagination to guide real, substantive change. Difficult to see down the road while looking at the bug on the windshield.

  • ToysRUs
  • Radio Shack
  • Sports Authority

It is likely these companies saw the advance of technology and understood the implications to the survival of their business model. Yet, in spite of feeble efforts to adopt technology initiatives, worse yet, failing to understand the significance to their business model, these companies failed. Survival is optional.

An emerging characteristic of those companies who successfully adapt, is the abandonment of legacy thinking. I always thought it curious that Uber seldom considered how to comply with local taxi authorities and focused on a business model that in large part ignored those restrictions. I watched and chuckled as Uber was forbidden to serve a market because they refused to comply, only to watch municipal magistrates eventually remove those restrictions in the face of market demand.

One would think that a local taxi company would examine and copy Uber’s technology to compete head to head. It was certainly available to them. What stopped the effective adoption of technology had nothing to do with the technology.

What stopped the effective adoption of technology was the sacrosanct immovability of the legacy thinking. A legacy taxi company cannot imagine a world where they own no vehicles. A hotelier cannot imagine a world where they own no physical hotel properties.

It’s a Trap

There were twelve incredible opportunities staring at Roger, all of them saying, “Pick me!”

Once an organization gets some traction in their market, over the hump of cash flow and all that, the next biggest trap is the incredible opportunities.

As your company grew, everyone said, “You’ll never make it,” but your company did. Who is to say that your company cannot be successful at all of the other opportunities staring down at you?

Sometimes, the most important decisions that you make, are the decisions about what not to do. The growing organization needs to focus its efforts on becoming more successful at their core business. There will be plenty of time, later, to chase down that incredible restaurant deal or that mail order pharmacy company.

Disciplined focus, execution, not opportunities. Stay out of the trap.

Stop Working Harder

From the Ask Tom mailbag –

Question:
Last night, I got out of the office at 9:45p. I don’t know what it is. This has been going on for the past three weeks. On Monday, things don’t look so bad, but come Thursday and Friday, the work just seems to pile up. I worked the last three Saturdays and last week, had to come in on Sunday. Missed the football game.

If I had known ahead of time, I could delegate some of the work out and it would already be done. But I don’t know about some of this stuff until it’s too late, or don’t realize how long it is really going to take. All of sudden, the pile is stacked up and everyone has gone home. The work’s gotta get done.

Response:
I don’t believe you. If you sat down and thought about it, almost all of your work is predictable, you just don’t think about it. You don’t delegate out, because you like working under the gun. Here’s the thing. You think you will get sympathy from me for all your hard work, but the just dessert for hard work is more hard work. You have to stop working harder and start working differently. -Tom

That’s Me

“I don’t care,” Roberto insisted.

“What do you mean?” I asked.

“I don’t care if that is what the boss wants. It’s a stupid idea. And my role is not to do stupid shit.”

“Pushback?”

“Call it what you want. CEOs run fast, sometimes making a mess. That’s why I have a job, to clean up the mess they call strategy. Somebody has to execute. That’s me.”