There’s never been a more important time to rethink business strategy. We’re overwhelmed by the shifts in our competitive space.
Our industries are being challenged by global competitors that are moving faster than ever. Inside our companies, we need people with new skills that range from expertise in artificial intelligence to talent in global expansion. At the same time, the customers and communities we serve face massive challenges that reflect trends from outside our four walls – from sustainability to energy to food access.
We know we need to pause from our work running day-to-day operations to address our business strategy. But the traditional way we’ve approached strategy needs to be completely redesigned to keep pace with today’s market dynamics. Traditional strategy tools like competitive analysis, SWOT, design thinking, theory of constraints, blue ocean and lean startup aren’t suited to the task. They weren’t designed for today’s business environment. That means we’re left without growth strategies that will truly work.
We’re stuck. We need new tools that will get us unstuck.
That’s exactly what inspired the book ‘From Stuck to Scale’. It’s a new blueprint for strategic growth that tackles our biggest obstacles and prepares us for breakthroughs. Here’s how it works and how to get started.
In today’s world, successful strategy must include tools for getting unstuck
When it comes to business strategy and breakthrough growth, there are two harsh reali-ties that we can fix:
- The best ideas don’t necessarily become the best businesses.
- Too many important initiatives – with the potential to serve thousands or millions of people – die an early death. They don’t get the internal support they need, customers don’t flock to buy them, they miss the technology mark, or they simply fall flat. Which means they never achieve the scale they deserve.
We can’t look at one factor as the single cause of every strategic shortfall. But we can change the fate of strategic projects that fall short – by applying a new diagnostic and using a new set of tools. We can move innovation from stuck all the way to scale by taking a fresh approach.
A 20 euro bet ten years ago set the stage for ‘unstuck’
Ten years ago, I had the realisation that we needed a more effective way to tackle our strategy roadblocks. It was the conclusion of a two-day leadership retreat at a large healthcare organisation. The teams had all been directed to design and lead major innovation and growth initiatives. The leaders had calculated financial projections, studied market forces, considered future demand and factored in as many leading trends as they could envision. They had also brought into their growth plans novel products and services that they believed would serve customer needs and sell well.
When I walked into the leadership summit, the future looked promising. On paper and in Powerpoints, thirty leaders each presented their strategies, representing a wide range of innovative products, expansion proposals and even recommendations for acquisitions. I was so confident that I could predict which of these initiatives would drive growth that I actually made a small wager on my way out of the room. I picked the teams I believed would hit their projected revenue goals and drive profits in the coming year based on their presentations that day and I smiled as I laid down my 20 euros on my choices.
The problem was that of the 30 new paths to growth that looked so good on paper, only five turned out to be winners. And the winners weren’t the ones I’d bet on. Ever since I lost that 20 euro bet, I’ve studied what went wrong in that organisation’s strategy and where so many leaders in other companies, other industries and other countries miss the mark. For ten years, working with thousands of teams, I’ve focused on fixing what I believe is the most important issue of all in today’s dynamic, high-speed market:
What does it take to remove barriers and accelerate a successful business strategy?
The results are in my newly-published book ‘From Stuck to Scale’ – a playbook that addresses both the mindset and the tools we need to tackle challenges, create successful strategies in a very uncertain market and get the support we need to build thriving business innovation.
Here’s the secret: To make a strategy work, start by diagnosing where you’re stuck.
Five stages where we face setbacks
There are five stages in the lifecycle to guide strategy toward something novel that can become big. This process applies whether you’re leading a team to develop a new consumer product, a healthcare service, a technology solution, a business-to-business product, a media platform, a fintech company or any business that can’t reach its growth targets by staying on an incremental path. Every step in the five-stage process presents unique pitfalls that prevent success as well as secrets to moving past those obstacles. We’ll start with an explanation of each stage and examples of leaders who faced similar challenges and were able to break through. Then, we’ll share three tools that you can use right now to jumpstart your growth strategy.
- ENVISION:
Imagine you’re a leader who’s been responsible for running a profitable division for years. When you’re asked to design next year’s strategy, you’ll probably be tempted to start with where you’ve been and build out features to your existing offerings. That’s where people get caught in the first stage, Envision. Before you know it, you’re making minor adjustments to what you’re already doing, and the opportunity to really forge a new path is gone. To get unstuck in the Envision stage try this instead: Bring together a group with diverse skills including trends and market insights, sales, logistics, finance, technology, marketing and regulatory. Put together scenarios that reflect where the market is heading and how your company might address a bigger customer need. Don’t worry about how you’ll execute yet, or you’ll run the risk of shutting down ideas with great potential.
- EXPAND
Here is where you might get stuck in the Expand stage. You develop your strategy, but do not realise you have blinders on. You might be tempted to lead with technology. Or, maybe you start with a spreadsheet and try to stretch sales projections. You could be basing your expansion on the needs of one customer, ignoring bigger opportunities that could serve the market more broadly. To drive success at the Expand stage, gather a team to check for bias. Question: “How might we be limiting our opportunities by thinking too narrowly?”
- BUILD
The third place where teams get stuck is in the experiment stage. Picture this: You assemble teams to mock up a new software platform, test market a product, pilot a novel service with customers you’ve never worked with before. All is going well until you realise you’re stuck in the small-scale pilot mentality, without a clear path to big markets or big revenues. When we’re stuck in the rut of small thinking, we need to identify the rut right away. Ask yourself if there are unmet needs that you could serve if only you had a different product. Make sure the team tackles the obstacles and continually expands the market potential.
- ENGAGE
Once you know you’re building a great product, how will you be sure you can capture a big market, sell to a large customer base, get the internal support they need and keep the growth coming? Too often, successful pilots don’t reach their full potential because the leaders who run the pilots aren’t able to enlist the support or make the sales. Transforming pilots into full-scale, thriving lines of business requires champions: Sales, logistics, product, customer support and sometimes even champions from your supply chain and partners. Take a hard look at whether the same person who runs the pilot is the best person to bring the strategy forward as it grows.
- ACTIVATE
Have you ever watched a promising strategy fail when it was really close to gaining traction? Sadly, all of the hard work that we invest in developing innovation goes to waste if we can’t get people to take action. Unfortunately, new strategies compete with our existing lines of business and are starved for attention. Make sure people aren’t simply nodding their heads, but that they’re fired up to move out of the pilot stage. Teams need clarity on how they’ll execute and accountability that their success is linked to the success of the new strategy. Be the person to step forward and make sure that the strategy doesn’t lose momentum right before it hits its stride. Focus on bold action.
Example #1: Expanding revenue growth
‘From Stuck to Scale’ offers tools you can use to explore non-incremental opportunities.
Tool: Opportunity Aperture
Let’s imagine you’re Intergráficas, the company that was stuck in an industry with poor prospects for future growth – running a music compact disc factory. If your strategy starts with a look at the music industry, you’ll likely stay stuck in a revenue rut.
That’s where the Opportunity Aperture tool can help you expand your thinking about growth. Instead of starting your strategic planning with ‘music’ and trying to build incremental revenues, start by writing down a new customer segment that might be growing and emerging trends you think might fuel growth for your business.
In the case of Intergráficas, Nicolas Cortázar thought that food delivery might be a potential source of new revenues, even though he wasn’t sure how he’d make the leap from music to food. So, he wrote down ‘food industry’ and his team started brainstorming. Which core capabilities might be important to successfully enter the food business? They jotted down core capabilities like ‘great packaging design’, ‘health safety’, ‘easy to deliver’ in the center of the diagram. Then, to inspire the team to explore what it would take to expand revenue growth in the food delivery business, they listed companies that did a great job in each of those core capabilities.
For great packaging design, they listed P&G.
In the case of health safety, they listed Ecolab.
In the category of easy to deliver, they listed J&J.
Using the inspiration of those companies, the Intergráficas team pieced together a sketch of what their own offering might look like in the food delivery industry.
Your turn:
What about you? What might your Opportunity Aperture look like? What customer group do you believe you might serve to expand your revenues? Which trends do you think your team could build on to drive revenue growth?
Example #2: Figuring out where and how to innovate
‘From Stuck to Scale’ offers tools you can use to figure out where and how to innovate.
Tool: Ideaboard
Remember Rappi, the company that started out delivering sandwiches and ended up expanding to RappiPay, RappiBank, RappiFavor and RappiTravel – and becoming a 5.2-billion-dollar company in less than a decade? There’s a strategy tool in ‘From Stuck to Scale’ that allows you and your team to systematically explore options for where and how to innovate.
Example #3: Turning early-stage initiatives into successful lines of business
‘From Stuck to Scale’ helps leaders map their future ecosystems – with partners, collaborators, customers and suppliers who can drive bold action.
Tool: Ecosystem Mapper
To illustrate the power of this strategic tool – Ecosystem Mapper – let’s remember Copenhagen Fintech. They started from scratch trying to imagine how they might establish a hub for growth in an industry with staying power. In their case, they began with insights into emerging trends and identified financial services as an industry that might fit their profile.
The data they collected and the initial mapping they did with Startup Genome began the process of developing a fintech strategy centered in Denmark. They took to heart Startup Genome’s metric of global connectedness as a driver of success and mapped a step-by-step approach to building a highly-active and extended community to fuel growth. Here are some of the questions they asked themselves to fill in their ecosystem map with people and companies who would benefit from a global finance hub based in Denmark:
In the category of Profit: Which existing banks might benefit from improvements in customer service? How might payments companies benefit? How might we motivate incumbents to be part of our community?
In the category of Platform: How might innovative companies specialising in cross-border transactions grow as a result of a fintech innovation hub?
In the category of Purpose: Which other regional hubs might value a strong community of startups and corporations focused on innovation? Might organisations like the Monetary Authority of Singapore and others be interested in participation and collaboration?
Your turn:
What about your strategy? How might you build a true ecosystem with suppliers, customers, government, universities, collaborators, leaders in other regions? Sit down with your team and brainstorm your strategy using the Ecosystem Mapper to zoom out and build your strategy even bigger.
Conclusion
In a world that’s changing so fast, we know our current strategy tools aren’t sufficient to keep us growing. To stay relevant and plant the seeds for new lines of business, look at the five stages that leaders need to navigate to move from the early stages of exploration all the way to steady upticks in revenues: Envision, Expand, Build, Engage and Activate. And clear obstacles that get in the way to truly drive innovative strategy.
’From Stuck to Scale’ by Andrea Kates diagnoses exactly what it takes to help corporate teams, entrepreneurs and ecosystem leaders succeed in bringing new initiatives across the finish line. It’s a practical workbook with original tools she’s created and first-hand case stories from companies she’s worked with and leaders who represent fresh thinking and breakthrough growth. To find out more and take the diagnostic visit www.andreakates.com.
