II. The Bridges Q3-Methodology - A Conceptual Introduction and the Blue Stars Corollary
Contents
The Q3 Methodology
I. KISS - A Practical Prologue
II. Q3 The Conceptual Foundation
III. Q-cubed and Ice-cubed
IV. Ice versus Ice3
V. A Postscript: Ice versus Computer - The Refridgerator Sprint!
The Blue Stars Corollary is presented on its subpage.
THE Q3 METHODOLOGY
I. KISS - A Practical Prologue to Q3
Q3 is based on asking questions. It is as simple and easy, and as complicated and difficult, as that. Asking the right questions to determine a strategy and the tactics to accomplish it depends on a combination of factors. These include a theoretical grounding, senior management experience, insight and imagination. One also needs a touch of serendipity (being in the right place, at the right time, with the right people) and to be a good fit with the client.
This website presents arrays of questions encompassing three degrees of difficulty. They start with four intuitively obvious ones, the Marketing Research Tall Tales. (How could anyone, let alone so many, many professionals and graduate students, not consider the answers self-evident?) Of medium difficulty are question series such as those in the Blue Star Strategy Audit and the Marketing Audit. The summit, in terms of difficulty, is reached with a quantitative challenge to update the Vidal-Wolfe model at Papers.
Presenting such extensive examples serves two purposes. The first is to help you pose better questions, to serve as a catalyst for your own independent strategic deliberations. The second is to demonstrate "Socratic expertise." The website is replete with complexity. A certain level of complexity lends academic legitimacy. As such, it is a "nice to have." That competency is, we trust, sufficiently demonstrated in this website. Therefore we do not need to go down that primrose path to the everlasting bonfires for the actual hands-on coaching.
For the actual coaching, real results do not come from complexity and over-intellectualizing strategic choices. A KISS approach works better:
Keep It Strategically Simple.
II. Q3 - The Conceptual Foundation
Q3 is based on a:
• Quorum, of
- the CEO/entrepreneur
- and the leadership team
• Qoogols1 approach
- of iterative questions
- reflecting eclectic tools & techniques
• Quartenary of strategic schools
- positioning & entrepreneurial
- cultural & power
Synthesisizing elements from these four schools in order to ask a client the right series of questions is the crux of the Q3-methodology to forming -- and implementing -- a powerful strategy.
Qoogols, i.e. innumerable questions (cf. footnote 1), need to be asked systematically. Posing the right series of questions is orders of magnitudes more powerful than random "shots in the dark." Of course, applying a single strategy dogma may well spell success for an individual firm. However the same dogma is unlikely to be universally effective when applied across the board to other companies with their own innate characteristics in entirely different industries and environments. Therefore we prefer an eclectic approach to crafting strategy.
The basis for Bridge´s Qoogols is shown on the subpage VIII. "Tools & Techniques." The correct combination of Qoogols facilitates "bridging the gap" from where one is, to where one wants to be. A "Qoogol Bridge" may take many forms, as shown below.
Gaoling Bridge of the Summer Palace, Hennessy, Bejing, China *
A taxonomy of the strategy schools of thought is presented in Strategy Safari, A Guided Tour Through the Wilds of Strategic Management, by Henry Mintzberg, Bruce Ahlstrand, and Joseph Lampel, Free Press, 1998. In this seminal work, nine traditional schools are discussed, and an all-inclusive tenth Configuration School added. One school was omitted: the "what-me-worry" Alfred E. Neuman Mad Magazine Strategy School and its ad hoc practitioners. They are more prevalent than one might think.2
The ten different schools are not mutually exclusive.3 In fact there is considerable overlap among them. For the purposes of strategy coaching, Bridges subsumes the ten schools into four:
1) The Positioning School for forming strategy has its origins in military writings and is the home of some of the most famous thinkers in strategy: Bruce Hendersen, Michael Porter and Kenichi Ohmae to name just three. This school is reflected in the elements of the subpage "Tools & Techniques" at Services. That subpage also discusses the assumptions and some of the weaknesses of taking a purely positional approach.
2) The Entrepreneurial School, home of the Grand Vision is reflected in the subpage "Start-up (EBO) Strategy" at Services. Translating the vision into action is treated at "Execution" at "Corporate Strategy" under Services. Grand Visions gone awry -- and when they do, their failures can be spectacular indeed -- are treated at "Strategy Repair" at Services.
3) The Cultural School emphasizes three spheres of influence. The first is in how decisions can create perceptual lens or filter, perpetuating a certain viewpoint. The second is in resistance to change, and overcoming that resistance. The third is in key values such as the attitudes towards customer service, product quality and innovation. Some of the most influential work appears in Building Cross-Cultural Competence, How to Create Wealth from Conflicting Values by Charles Hampden-Turner and Fons Trompenaars, John Wiley & Sons, 2000. The cultural school is treated in a brief slide presentation: Corporate Culture Circles Culture. Culture and power reflect one another.
4) The Power School emphasizes strategy as a process of negotiation. This school is out of the academic mainstream, a somewhat unappreciated stepdaughter. She is conspicuous by her absence at most strategic balls. However Bridges strongly feels that courting her makes sense. Therefore she is considered at length at "Negotiation Strategy" and its subpages at Services.
III. Ice-cubed (Ice3)
Let us consider ICE, which may be used as a strategy acronym, and not just because strategy is a slippery subject, or because of the dangers of moving forward (mergers, acquisitions, transitions) on thin ice. One may postulate that strategic ICE3 consists of:
Initial Core Evalutation - what is really our business, where to compete
Improved Competency Execution - communicating & implementing the strategy
Inimitable Corporate Excellence - sustaining the competitive advantage
Ice -- and ICE3 -- have developed in three stages, each with its own price/performance and experience curves. The first stage was harvesting ice -- and traditional internal strategy formulation by the CEO. The second stage was the ice factory -- and external strategy formulation by management consultancies. The third stage is the home refrigerator -- and the advent of strategy coaching.
Moving Along the Curve versus Competing on a New Curve
Stage I to Stage II
In the 1880s in the U.S. 25 million tons a year of ice4 were "harvested" from frozen lakes and ponds. At about this time, ice machines were becoming cost effective. They had first appeared some 30 years earlier. The then dominant player, Tudor the Ice King, did not embrace the new technology. Rather, he attacked it. (Some biographical notes about this courageous, relentless -- yet forgotten -- entrepreneur appear on the subpage "The Ice King" on the menu at the right.) By 1900 ice harvesting had become irrelevant.5 In fact, no ice harvesters made the transition to ice factories despite their having the customer knowledge and distribution expertise.
Stage II to Stage III
In 1920 the industry of ice factories ranked 9th in the U.S. in terms of investment. Seven years later the home delivery segment of the business was mortally wounded as home refrigerators began to take off with GE´s Monitor, which sold a million units. By the 1930s the ice factory with an integrated supply chain of ice blockhouses had essentially disappeared. Not one single ice factory company made the transition to manufacturing refrigerators.
Why? People tend to define their businesses in terms of what they do: "harvest ice," "make ice large scale for households." They were not viewing their businesses in terms of "delivering ice to the customer" in the most efficient possible way.
Ice3
Stage I to Stage II
No renowned Fortune 500 CEO switched into creating a strategy management consultancy that became a global firm.
Stage II to Stage III
None of the strategy management consultancies is aggressively supplementing the business model of the engagement team with an executive coaching component. Understandably enough, they do not appear likely to enter the mass market for virtual (on-line) strategy services any time soon either.
Nevertheless, the proper view of the business is "delivering ICE to the client" in the most efficient possible way. A seasoned strategy coach who works on a performance basis can represent very efficient delivery. In many situations adding such a coach to the "strategy mix" appears eminently reasonable. (Similarly, the Internet represents very efficient delivery for strategy services to the mass SMB market. This approach is not, however, consistent with a "one client per industry" commitment.)
Why choose the Bridges brand?
First, for certain clients the "goodness of fit" will mean that Bridges is arguably the most efficient way to get ICE. Second, a Bridges coach will not deliver ICE to the competition. Third, we believe our USP creates a self-fulfilling prophecy: the chosen coach working with the chosen client dramatically increases the chance of co-achieving significant results.
IV. Ice versus Ice3
A Historical Excursion
Let us take a brief historical excursion to conventional ice in the company of its namesake acronym for a closer look at their performance/experience curves.
Stage I: harvesting ice
The Ice King, Frederic Tudor, was not from medieval England. Rather, he was a 19th century American entrepreneur. He successfully transported ice, "harvested" from New England lakes, to nearby cities and as far away as to Calcutta, India. The competitive advantage that enabled him to dominate the ice industry was logistics. He transported ice more efficiently and had bigger, better, and more ice storage blockhouses than his rivals. The ice would be delivered from the blockhouses by wagon to individual households.
From the early 1800s to the 1850s and beyond he was still competing on the same technology curve as the Persians in 400 BC. (They brought ice down from the mountains to the blazing hot desert, storing it in large underground vaults (5000 cubic meters) with thick walls made out of a special mortar.) ("ice" Wikipedia, 2010)
Strategic ICE
ICE originally reflected the vision of the emperor, emir, explorer-entrepreneur, as conveyed directly or by his emissaries and éminences grises. Similar to frozen water, it moved on the same curve throughout the centuries -- from antiquity into well into the second half of the 1900s. ICE was conceived, developed and delivered internally.
Stage II: ice factories
The new curve, the paradigm shift in technology, came with the advent of ice factories.6 An ice-making machine was first patented in 1834 by Jacob Perkins, an American in London. By 1880 there were machines that could make 18 or 19 tons of ice a day more cheaply than one could harvest it. However this development did not change the delivery system: from ice blockhouse by wagon to the end user.
Strategic ICE
The equivalent paradigm/production shift in strategy formation came with the advent of the management consultancies. The American predecessor was Arthur D. Little, founded in 1886. However the creation of large strategy ICE factories was really initiated by just three firms: McKinsey & Company, founded 1926; Boston Consulting Group (BCG), founded 1960; and Bain & Company, founded 1973. There are other major firms offering strategy services, some with several thousand consultants in their own right, and myriad smaller firms, many founded by former partners of the Big Three. Nevertheless the Big Three remain dominant in strategy consulting to this day.
ICE is developed by external advisors and delivered to the client (either the corporation or a sbu) with teams. The teams can be massive. The consultancy doing the work will not hesitate to develop and deliver ICE to competing companies.
Stage III: the home refrigerator7
Commercial refrigeration units were developed in the second half of the 19th century. They used toxic gases and were too dangerous and bulky to use in homes. Units aimed at households came on the market in the U.S. in 1915. Early home refrigerators were cumbersome with the power unit being located in the basement, and the storage unit in the kitchen.
Similar to the advent of minicomputers, that the 1915 technological advance would so rapidly lead to a mass market for much smaller units was not immediately evident. In 1922 a home refridgerator in the U.s. cost over $700, at a time when Ford´s Model T automobile cost $450!
In 1923 Frigidaire introduced the first self-contained unit. In 1927 General Electric (GE) introduced the first popular unit, the Monitor, which still used toxic gases. By the end of the 1930s, prices had fallen dramatically as better and safer refrigerants such as Freon came to the market. Soon over 60% of U.S. households would have a refrigerator. The Stage II household ice delivery business was dead and buried.8
Strategic ICE
Advisory services for strategy are undergoing two changes. Are they paradigm shifts that will re-define the industry? No. Are they merely incremental moves along the existing curve? Time will tell; ex post facto pronouncements are always easier!
The first change is the increasing number of strategy coaches who assist with the internal formulation of strategy, which is delivered by the organization´s own people. The second is the beginning of strategy services for the mass market with a different delivery system: the virtual coach on the Internet. On-line coaching with associated webinars is being targeted at the general business public. And this movement is gaining momentum.
V. A Postscript: Ice versus Computer
-- the refridgerator sprint --
The development of the ice industry makes for an interesting comparison with the computer industry. Granted, ice, specifically refrigeration, got off to a slow start. It does not appear to be moving anywhere fast nowadays either. But "every dog has its day" as described below. The first major technological breakthrough was in Iran. The Persian chemist and physicist Ibn Sina (Avicenna) invented the refrigerated coil in the 11th century. From this breakthrough to a commercial freezing unit took over 800 years!
The abacus notwithstanding (which was used since at least 500 BC), the first modern computer was Konrad Zusa`s Z1, built in 1938 in Berlin. It was a programable electro-mechanical computer, using Boolean logic and floating point numbers. It weighed about one ton.
The first electronic computer was the ENIAC at the University of Pennyslvania in 1946. It was 30 times heavier and 1,000 times faster than the Z computers. From this room sized contraption to the third generation of electronic computers took less then twenty years. The third generation was successfully introduced by DEC in 1964 with the PDP-8 midrange computer, which came to be termed "minicomputer." The basic version cost $16,000 at a time when a new mid-range car, e.g. a Ford, cost $3,000 to $4,000.
Everyone talks about the astonishing speed of computer development and market penetration: from the 1946 EINIAC to the 1964 minicomputer to the IBM PC of 1981, following Apple´s lead, to bring a computer to every desk. (The first PC was the little known MITS Altair 8800 in 1975, followed by the legendary Apple I in 1976.) The transition from expensive minicomputer to the ubiquitous "everyman" PC took about 17 years.
For a brief while, ice moved faster, at least in the U.S. - the refrigerator sprint! One went from the midrange unit in 1915 to the "PC" unit, GE´s Monitor in 1927, in 12 years. The Monitor alone sold over a million units. Less than a decade after its introduction over 60% of U.S. households had one brand or another of refrigerator. Interestingly this level of market penetration was not reached in the United Kingdom for 40 years!
1 flight of whimsy on my birthday after a VIth form math class by Mr. Flint at Brooks School, North Andover, Mass. (The first time I used it in German, "das Qoogol," was 18.04.2006.) Mr. Flint had explained what a googol was, as related below at 6.1. (He was the best math teacher I ever had. I believe he had studied physics at Harvard and, upon retiring, came to Brooks to teach math.) The word is formed by changing the g of googol to a Q (for questions).
In the 80s I once encountered a retired professor from Stanford who liked to use the word. He told me he had coined it as a graduate student. He dryly commented that he seriously doubted he was the first to think of it either. Changing a letter of a word to come up with a new word is not really all that much of a creative leap.
A googol (not Qoogle) is the figure 1 followed by 100 zeros, or ten to the one-hundredth power. That is a large number, larger than the number of elementary particles in the observable universe, for which estimates of 1079 to 1085 have been made.
The Wikipedia articles (2010) on Google and Dr. Edward Kasner (1878 - 1955) give an interesting etymology. In 1920 Kasner (1878-1955), an American mathematician who had earned his PhD at Columbia University, was taking a walk in the New Jersey Palisades with his nine year old nephew, Milton Sirotta. He asked for suggestions to name a very large number, viz. 1 with 100 zeros. Milton suggested "googol" and followed with another suggestion for an even bigger number, "googolplex" for a "one, followed by zeros until you get tired." Kasner formalized the definition of googolplex to 10 to the tenth to the one-hundredth power, which is the largest number in common usage. (In theoretical mathematics there are specifically defined larger numbers written with tetration.)
The googol was introduced to the public in a book Kasner wrote with James Newman, Mathematics and the Imagination, 1940, which has been reprinted by Tempus Books of Microsoft Press in 1989, where the googol story appears on p. 23. Google, the Internet search engine, is derived (misspelt?) from googol. The company´s headquarters in Mountain View, California is named Googleplex.
2 Mad Magazine is an American humor and satire magazine founded in 1952. The iconic Alfred E. Neuman is featured on its covers. He has jug ears, a missing front tooth, and one eye higher than the other. His motto is "What, me worry?"
3 Each of the ten schools emphasizes a different aspect of strategy formation. They are the Schools of:
(1) Design, a Process of Conception
(2) Planning, a Formal Process
(3) Positioning, an Analytical Process
(4) Entrepreneurial, a Visionary Process
(5) Cognitive, a Mental Process
(6) Learning, an Emergent Process
(7) Power, a Process of Negotiation
(8) Cultural, a Collective Process
(9) Environmental, a Reactive Process
(10) Configuration, a Process of Transformation
4 The source for the statistics in these paragraphs is "History of Ice Manufacturing at the Turn of the 20th Century" by Matt Moffatt.
Guy Kawasaki brought my attention to the ice industry. He is a Silicon Valley entrepreneur and founder of the VC firm Garage Technology Ventures. Its website has excellent suggestions for anyone seeking funding. He is also an entertaining public speaker whose refreshingly self-deprecating delivery does not keep the competency from shining through. In talks based on one of his eight books, The Art of the Start, he illustrates the difference between moving along the curve versus competing on a new curve, a paradigm shift, with the development of the ice industry. YouTube has both long and short versions of the presentation based on the book, cf. "Guy Kawasaki The Art of the Start."
5 Ice harvesting died a lingering death. An interesting paradox emerged. The ice harvesters tried to compete against manufactured ice on quality. Natural ice was healthier. The cheaper it became to make ice, the more polluted the lakes and ponds were becoming, and the more vigorously were the claims made about the benefits of, so to speak, "organic" ice. As if pollution were not enough of a problem, consumers started to view ice deliveries not as "here comes respite" but rather as messy and inconvenient. The introduction of electric household refrigerators in the early 1900s struck the death knell for the "from ice factory to your home" delivery business.
6 The ice factories became possible with the advent of efficient ice machines. The first patented ice machine was followed by a steady stream of improvements. Early examples include the patents by Professor Twining of New Haven, U.S. (1850), the steam engine driven ice-making machine by Dr. John Gorrie, U.S. (1851), as well as patents by Harrison of Australia (1857) and Siebe of London (1862), among others. In the U.S. the ice factory industry, which took off in the early 1900s, was propelled by the Southern States. They resisted having to depend on the North for deliveries of ice. The source is "Ice Harvesting and History," collated from the Frank O´Brian collection by Ron Taylor.
7 The information for this paragraph is primarily taken from "refrigerators" Wikipedia (2010). Some supplemental information is from Matt Moffatt, op.cit. (footnote 2).
8 Home refrigerators did in fact lead to the extinction of one kind of ice factory, the kind with (or selling to) a supply chain of ice blockhouses aimed at home delivery. However the ice factories not pursuing the " blockhouse to wagon to your door" business model could survive. In fact, in 2002 in the U.S. there were 426 commercial ice factories supplying ice to the tune of $595,000,000 p.a. (Matt Moffatt, op.cit.)
*© 北京颐和园的高梁桥 Gaoling Bridge, China, 27. Feb. 2006, Wikipedia GFDL-GNU 1.0 Gyan Web Design 2010