One of the more interesting books I have read on strategy recently is “Playing to Win” by Procter and Gamble CEO A.G. Lafley and Roger Martin. The book uses case studies from Procter and Gamble’s history to demonstrate how to create a winning strategy.
I have already written about how to use their “Strategy Sniff Test” to quickly determine whether or not you actually have a strategy. In simple terms it means looking at each of your long-term strategic moves and asking, “Could we do the exact opposite, and would that also be a valid strategy?”
If doing the opposite of your stated strategy would be stupid or nonsensical, then it is not really a strategy at all. It is simply a table stakes requirement for doing business in your industry.
Here is my take on a selection of the other lessons contained in the book - with my additional commentary added:
Avoid these Strategy Traps:
Trap #1: The “something for everyone” strategy
This is where you fail to clearly identify who your ideal target market customer is.
You can’t please everybody, and you shouldn't try. A winning strategy requires making a clear choice to serve a specific customer segment really well and not worry about appealing to the others. As my friend Doug Hall says, you must “Delight the few to attract the many.”
Remember, a proper strategic choice requires you to make trade-offs. Your strategic moves should specify clearly what you are going to say ‘YES’ to, and by association what you are NOT going to do.
If you are not making clear choices with trade-offs, then you do not really have a strategy.
Trap #2: The “Waterloo” strategy
This is where you try to take on your strongest competitor(s) in a head-to-head battle; feature for feature, service for service.
Unfortunately, if your product or service looks like, and performs like your competitors, this is just a recipe for commoditization and price competition.
No company can expect do everything well, and if you try fight on all fronts you will just end up being mediocre at everything. You need to choose your own “blue ocean”; an uncontested niche area where you can serve a specific group of customers in a unique way.
A winning strategy requires you to focus your efforts and resources in a way that is distinctly different from your competitors.
Trap #3: The “magic vision” strategy
Creating a compelling vision and setting goals for the future is great, but they won't magically come to pass just because you wrote them down.
Goal-setting is not strategy. If you develop a BHAG for your organization, but fail to translate your lofty vision statement into concrete strategic moves, you've fallen into this trap.
Trap #4: The “copy everyone else” strategy
This is where you chase the same trends all your competitors do; use the same tools and technologies, deploy the same marketing approaches, offer the same features and benefits, chase the same customers and geographies, and run your organization using the same management fads being written about in the business media.
Unfortunately, the more your choices look like those of your competitors, the less likely you are are to stand out and be a winner.
Telltale Signs of a Winning Strategy
One thing that is seldom mentioned in the business media is the role that luck and fortuitous timing has played in the creation of successful companies.
While that can be relevant, in general, though, there are a few fortuitous signs that you might be onto a winning strategy:
Sign #1: Your Core Activities are different from those of your competitors.
You don't try to do everything that your competitors do. You are delivering value to a specific group of target customers in a distinctive way. You are not trying to be all things to all people.
You have made it very clear what are you are NOT going to do. You have realized that the essence of a winning strategy is being able to say ‘NO’.
Sign #2: Some prospects love you and become customers who advocate for you, while others look at your marketing and dismiss you as an option straight away.
You have made a deliberate choice about who your ideal target market customer is, and your marketing and product/service design reflect this. You have made it very obvious who you are “for” and who you are “not for”.
You are not trying to appeal to everyone. As Seth Godin says, “If you are not annoying some people you are not operating close enough to the edge. The edge is where the money is.”
Sign #3: Your target customers are loyal to you because they feel like you totally “get them” and understand their unique needs.
Because of your deep understanding, they believe you are uniquely positioned to develop innovations in the future that will create value for them over the long-term.
Even if you can check all these boxes, you cannot rest on your laurels, because no strategy lasts forever.
You must review and challenge your strategic decisions regularly to ensure they still make sense in light of the ever-changing environment around you.
Regularly sit down with your team and go through the key points listed in this article. Take a look at our proven process to create a real strategy for long-term success.
Once you're sure you've made some great strategic decisions, make them come to life for everyone in your organization by choosing on a small handful of short-term projects that will move you in your chosen strategic direction. And make sure you discuss them and update them every week in your meetings!
Ultimately, when that happens, you know you're well on the way to executing your winning strategy.