Yet Another Primer on Strategy

Unfortunately, we really do have to talk about strategy.

By itself.

As a concept.

Just for a moment.

This is for two reasons:

1. It will help round out our understanding of tech strategy and give us a foundation for just about everything we know and learn about the subject from here on out.

2. It is surprising how few people truly understand the concept while so many throw it around flippantly, despite the overwhelming number of resources available on the subject.

Granted, it is somewhat complex. Although, maybe it’s more mysterious than complex. It’s complex in the way philosophy is complex. It’s just somewhat hard to grasp at first.

It’s…squishy.

It’s not a hard science, per se. You don’t have data that gives you a warm and fuzzy feeling about a result. You don’t know that 2+2=4 or that there are 180 degrees inside of a triangle.

So with that in mind, we’re actually going to start with the complex and work our way towards the simple.

Let’s start with the quote at the top of the email from Roger Martin, which–if you’re like me–might have taken a few read-throughs before you got at what he was saying. Once you get it, though…

I appreciate Mr. Martin’s approach, because in that one quote, he cut straight to what makes strategy so squishy:

Strategy is about making choices where the correct answer is not so abundantly obvious.

In fact, it’s really about a set of choices, or, more specifically, a set of activities that a business or person chooses to participate in. What’s more, according to Michael E. Porter in his 1996 article “What is Strategy?”, that set of activities should be unique.

In this instance, “unique” sort of has two aspects to it:

• There is the individual element referenced by Mr. Martin that points to each activity having an opposite or different version that could just as easily make sense for the given scenario. (This is where we start talking about trade-offs.)

• Then, there is the “sum of parts” element that makes the set of activities in question different from other sets of activities.

The individual elements, pulled together to make the whole, comprise a unique value proposition. Mr. Porter said it’s “about being different.”

The quintessential example he gave was of Southwest Airlines (and remember, the article was written in 1996, so the airline was still pretty young relative to the other major players). I wish I could keep this quote short, but this particular bit is too good to try and summarize.

Now, the casual observer could look at Southwest’s choices and try to say if they had just offered a few more options or flew more people at one time or fed people on their planes, they could have made more money, but that would be missing the point.

The observer would technically be right if they were talking about each activity by itself in a vacuum, but all of the activities together ended up forming a cohesive picture that spit out efficiency, cost savings, and room for margin despite the low ticket prices.

So, after weaving our way through the complex mire and hopefully understanding the concept a little better, let’s finally get to simplicity.

Strategy, at the end of the day, is about making a bunch of choices about how, when, and where you do business that is different from how, when, and where the other actor does business…and then sticking with those choices.

It’s not about having a plan, or being operationally “better”, or having the best Saas product in play (or having an AI tool that will revolutionize the way you do business).

It’s simply about being different, and being able to stay different for an extended period of time.

Next

Hopefully, this issue has rounded out your understanding of tech strategy as intended and also given just a little more credence to why the idea is important.

To add the final touches and tie this first series of issues together, next week, we will explore what makes tech strategy so difficult to form and follow and what makes it so…squishy.