Corporate Strategy Fundamentals: Six W´s, Three Q´s and One Consolidated C
1) The six W´s: Why, What, Where, Who, When, Wherewithal?
• Why were we doing this -- and Why are we doing it now?
• What should we be doing -- and What should we stop doing?
• Where should we do it?
• Who is accountable -- and Who will do the work, how?
• Wherewithal - With Which management, financial, and other resources?
These are the six W´s of the Q-strategy (Q for Questions): its formation (conceiving the vision and establishing the mission), tactics (planning the implementation) and execution (negotiating and leading: making it happen).
There is a tendency to overestimate -- and over-intellectualize -- strategic concerns, and to underestimate organizational ones, i.e. the people. Are you familiar with the strategy game, chess?
"Fancy what a game of chess would be if all the chessmen had passions and intellects, more or less small and cunning; if you were not only uncertain about your adversary´s men, but a little uncertain also about your own; if your knight could shuffle himself on to a new square on the sly; if your bishop, in disgust at your castling, could wheedle your pawns out of their places; and if your pawns, hating you because they are pawns, could make away from their appointed posts so that you might get checkmated on a sudden.
You might be the longest-headed of deductive reasoners, and yet you might be beaten by your own pawns. You would be especially likely to be beaten if you depended on your mathematical imagination, and regarded your passionate pieces with contempt." George Eliot (the pen name of Mary Anne Evans) (1819 - 1880), Felix Holt, The Radical, 1886.
Strategy -- and strategic shifts -- need to be cogent (cf. # 6, The One C, below) and are best kept simple. For the man who is barely literate and whose business consists of one pushcart to say "keep it simple" is one matter. For the CEO of a significant firm, a university professor, management consultant -- or executive coach -- to say that is quite another. In the latter case, the right to emphasize simplicity must be earned. Otherwise one could appear to be, heaven forbid, intellectually lazy.
More important than appearances is competence. The task of distilling simplicity from a dynamic, turbulent environment is always difficult. Familiarity with a variety of tools and techniques, many of them complex in their own right, helps greatly with this task. For this reason a number of them are elaborated upon in this section of the website, especially on the subpage the 36 Tools and Techniques. Properly applying the right combination of tools makes easier answering and assigning the W´s correctly.
2) Photographs versus a Film
Of corporate strategy there are endless photographs (in contrast to Lady Luck, one of whose very rare photographs is shown at the Q-Ship subpage). Henry Mintzberg, Bruce Ahlstrand and Joseph Lampel reviewed some 2,000 articles and books over their years of research for their classic, Strategy Safari (1998). This vast literature is steadily growing. Yet the majority of it -- the author suspects, the overwhelming majority of it -- whether inductive or deductive, prescriptive or proscriptive, or merely descriptive, presents hypothesis and theories as "photographs."
Often the photographs are in rich colors and assembled in gorgeous slide shows to form a book. They may convey compelling concepts. Nonetheless, just as products have life cycles, so do strategy formation, tactics and execution. These functions are dynamic and in a continual state of flux. They are really the stuff of movies.
Sudden movement, shocks, may include the advent of a new CEO, of a technology shift, of being faced with new (foreign) competitors, of a merger, of a major strike, a class action lawsuit or product recall, of being acquired. Gradual movement can have a cumulative effect just as large. This kind of movement may reflect incremental shifts in customer preferences, the impact on the corporation of a new generation of (female, generation X, etc.) managers, progressive changes in the regulatory environment, etc.
The combined effect of sudden and gradual movement is exemplified by the Fortune 500 list, first published in 1955. Of the original 500 largest companies, less than 70 are on the list today.1 The others, over 85%, are all gone. They were acquired, merged, or are too small to make the list, perhaps having become small cap stocks. Many have vanished in ignomious bankruptcy.
The three strategy functions as well as different kinds of sudden and gradual movement can be quantified and graphed with curves similar to product life cycle curves. Decision points for shifting from competing along a curve to moving to a new curve can be specifically defined. Calculations about change (1st derivative) and rate of change (2nd derivative) can be made. All this and more can be done in the service of the academic raison d´etre, "theory building empirical research." There is absolutely nothing wrong with that. However it is not the province of strategy coaching.
3) The Importance of Empirical Evidence
Of course strategy coaching should be based on facts and hard data, which is not to belittle the value of intuition and the quantum leap derived from a flight of fancy. Unfortunately relying on evidence is easier said than done. Empirical evidence is all too often not what it at first appears to be. The pitfalls are pointed out in the article "Evidence-Based Management" by Jeffrey Pfeffer and Robert I. Sutton in Harvard Business Review(HBR), January 2006, pp. 63 - 74. The preceding link is actually to the associated case study of 29 pages, a wise investment at only $7. (Two updates, both entitled "What More Evidence Do You Need?" of six and three pages respectively, were published in 2010.) The list below is from p. 66 of the article in HBR.
"What makes it so hard to be evidence based? A summary of "what you are up against" is:
• There's too much evidence.
• There's not enough good evidence.
• The evidence doesn't quite apply.
• People are just trying to mislead you.
• You are trying to mislead you.
• The side effects outweigh the cure.
• Stories are more persuasive anyway."
There are not too many champions, or championship teams, with no coaches, whether these appear in the public eye or not. Just as sports teams have different coaches who cooperate with one another, for instance for offence and defense, so may a corporation, sbu or company make use of a variety of advisors (accounting, consulting, coaching, engineering, legal). Two alignments are often overlooked.
- The first is for the executive coach to be acting in congruence with the other advisors.
- The second is for the external actors upon, and the internal actors of, the corporation to be marching to the beat of a limited number of similar drums. (Too many drummers spoil the syncopation.) Strategy needs to be coherent over the stakeholder chain. The chain begins with the customer. At the risk of mixing metaphors, if that link of the chain is the weakest, Pandora´s box may indeed become unchained and spring open. There is more about alignment at its subpage.
The Q3-Strategy is based on a triplet of Qs and a quintuplet of Cs.
5) The three Q´s are:
• Quorum (client´s leadership team) specific approach
• Questioning process reflecting different methodologies
• Quartenary of strategic schools
- positioning & entrepreneurial
- cultural & power
6) The five C´s are:
• Common sense: use it
• Concise: without superfluous detail
• Cost-containment: in congruence with experience curve effects
• Coherent: logically consistent
• Communicated: at all levels of the corporation
7) The consolidated C is a single potent word:
The definition from Webster's Third is (italics added):
1: having the power of compelling or constraining the actions of management and the workforce
2: appealing persuasively to the mind or reason to those within the company, to the customers and to the world at large
3: being pertinent, concise and timely; to the point and relevant, and able to accommodate change, flexible.
Cogent should be the formation, the tactics and the execution of the strategy. These three aspects are treated on their respective subpages. A KISS is often a cogent action:
Keep It Strategically Simple.
1 Geoff Colvin in an editorial "Long Term Thinking," Fortune Magazine, April 22, 2004.
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