Capacity for creating (real) strategy is a company health-ometer

Ahhh, risk.

We all like to talk a good game but in the end, risk is hard to swallow. Think about your life…

• It’s a risk to take that job.
  It’s a bleeping risk to not take that job!

• A risk to get into a serious relationship and bring your whole weird and emotional self to the table.
  It’s a risk to not let yourself be emotionally available and hole up in your fortress of solitude!

• A risk to move to that new city and expand.
  A risk to stay put in Puts-ville!

Each of us takes calculated risks. Big and small. It’s not comfortable. It’s just life.

Copyright Matt Adrian https://www.mincingmockingbird.com

So, true, for business and innovation as well. My favorite topic.

Most leaders would (and have) stood behind their respective podiums and said something akin to ‘healthy risk taking is imperative for growth!’ Yet there can be a big disconnect between talking risk and walking it, especially at larger companies where action-point can be layers away from decision-point. Things can norm into a silent culture of TALKing risk without taking risk.

But, dear reader, this post is about strategy. Why am I stuck on risk?

Because strategy is ultimately about embracing and managing risk. Strategy created without facing real risk is not strategy at all. It is strategy as theatrical production. And having a healthy risk-taking culture drives innovation and ultimately value delivered to customers and to the business.

There are mountains of business books written about managing risk with innovation (incidentally, some favorites are Innovators Dilemma, Brave New Work, Build, Good Strategy Bad Strategy). So many books! So much wisdom. So many principles that contain gold and should be read and deeply internalized by the innovator. And then — lovingly set aside.

Why? No amount of homework or theory prepares you for the utterly unique risk-to-innovation scenario facing you or your company as today’s Big Bets.*

We must all act and move if we wish to do something that matters.
The question is how/where/why?

Enter not-fake strategy

Real strategy is the breaking down of the risk/innovation monolith into realistic, actionable, experimental pieces that allow you to make a dent in your universe.

So, how do you craft real strategy?

First, a few basic mindset things:

1. Real strategy is painful and hard work. If it isn’t, you are not doing real strategy (sorry).

2. Real strategy is not borne of a framework where you fill in the blanks. It’s not a cleverly worded prompt for GPT to spit out an authoritative “do this next” response. It’s not even sophisticated and robust data practice “letting the numbers speak” (as important as that is). Frameworks and data are hugely helpful in gathering key insights that inform strategy. But they lack “do this next because…” articulation that real strategy provides.

3. For product and services companies, real (product) strategy is also therefore not the roadmap. Yet it’s astounding how many organizations point to their product roadmap as strategy.

4. Real strategy is also not a set of OKRs. (Roadmaps and OKRs are end-result holders of real strategy, not strategy itself.)

5. Nor is it a static document that gathers dust until someone asks, “hey, what is your strategy?”

“In most companies, there is no product strategy. Notice I didn’t say bad product strategy — I mean literally no product strategy.”

— Marty Cagan, Inspired

So why is it that many companies fail to reach their innovation potential and lack product strategy entirely?

Simple. The work of crafting real strategy means defining a crisp line around what a company is saying yes to and — more importantly — what they are saying no to. Real strategy pushes into view the bloody and often difficult trade-offs that a company is making in order to prioritize the critical and often controversial choices that will allow them to define the future of a category.

“Legacy Organizations fall down on strategy in two ways. They hesitate to make the kind of bold trade-offs that cultures such as Medium, Tesla, or Apple do every day. In their desire to be “the leader,” they try to appeal to everyone, do everything, be everywhere, and offend no one.”

— Aaron Dignan Brave New Work

Creating any real strategy is painful and arduous. It takes collective bravery at the leadership level. Crafting real strategy can bring forward all the unhealed parts of a company culture. It can be immensely scary, especially in company cultures that have fallen into talking more than walking.

But… lets say your company is healthy and brave and wants to look squarely at the true trade-offs being made by prioritizing one thing over another. Lets say you’re willing to do the hard work.

It is said no strategy survives first contact with the real world.

The point is not to nail the perfect quarterly or yearly strategy off the bat. The point of strategy work, as with any real growth, is developing the dialogue, discipline and everyday candor it fosters internally. Think of this as building corporate cardiac fitness.

The point of strategy work, as with any real growth, is developing the dialogue, discipline and everyday candor it fosters internally. Think of this as building corporate cardiac fitness.

Real strategy work is therefore some of the hardest work you’ll ever do as a leader. But truly a game changer for every organization culturally and practically.

So it should be no surprise, then, that strategy is a living, ongoing effort. A movie animation, not a snapshot. A way of thinking/speaking, not a Word doc. If you are not iterating on your strategy weekly/monthly, tweaking it, learning constantly and adjusting constantly, you are probably not doing real strategy work. (And don’t worry, the evolving aspect of real strategy does not mean you are constantly moving the goal posts on your team. Quarterly or yearly goals are marvelously symbiotic with a living strategy!) It is your job as leader to make sense of the incremental evolution of the strategy and script them into moves for your team. It is your job as leader to pull strategy into tangible cohesion that is actionable.

Proper risk-taking and strategy-setting are the building blocks of true innovation culture. Trade-offs and hard choices pave the way for all of it. The strong innovator companies see risks as the source of growth/innovation. Good strategy is how you connect the two.

Strong innovator companies see risks as the source of growth/innovation. Good strategy is how you connect the two.

My work as innovation coach is helping companies improve their choice-making fitness, helping leaders do the difficult but immensely worthwhile work of evolving their strategy skills and culture. There is no better work for a company or leader to undertake.

Matters Coaching is available for strategy fitness-building workshops and individual/group coaching for leadership. Reach out.

*Big Bets are the change-in-time-or-die junctures facing each company every single day.