# Category Archives: Strategy

Thoughts on Strategy

# How do customers recognize the truth?

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Marketing (marcom in particular) is communicating  about your product and company things that customers  believe are true n'est pas? Therefore, understanding how customers recognize truth is a pre-cursor to believable communications.

I've found three groups of people who've worked "truth" really hard. Religious, philosophers and mathematicians. Apparently there are ..... 9, NINE,  IX, 8+1 ..... different theories your customer (assuming they're people) might use to decide whether your statements are true!  Here they are:

1) Coherence                    - fits within a whole

2) CORRESPONDENCE    - proved by evidence or individual opinion in a similar context

3) Constructivist               - constructed from social processes, culturally specific

4) Consensus                    - whatever is agreed upon by a specified group

5) Pragmatic                     - verified by results of putting one's concepts into practice

6) Pluralist                         - "property" of a statement which makes a proposition true

7) DEFLATIONARY           - assertions of truth don't mean anything,  they're a tool of discourse                                                     to emphasize claims or form generalizations (also called Minimalist)

8) Redundancy                - asserting something is true is the same as asserting the real thing

9) EPISTEMIC                    - notion of truth is epistemic (all of the above)

Whew...there you go.  Now we know what to do.

If it helps, mathematicians thought they were on the most solid ground before Godel's incompleteness theorems http://goo.gl/Z50liu now they'd rather not talk about it.

Wait there's more ... "according to a survey of professional philosophers in November 2009 (taken by 3226 respondents, including 1803 philosophy faculty members and 829 philosophy graduate students) 44.9% of respondents accept or lean towards CORRESPONDENCE theories, 20.7% accept or lean towards DEFLATIONARY theories and 13.8% EPISTEMIC theories." (I'm not sure what happened to the other 20.6% maybe they told them to buzz off).

1)  ~45% of your audience will find 3 or 4 independent testimonial sources that corroborate your pitch (customers, thought leaders, editors, bankers, car salesmen etc) credible

2) ~20% will think you're just BS'ing to make a point

3) ~15% will think that it's all so complicated whatever anyone believes is cool

4) ~20% won't show up (read or listen)

http://psychology.wikia.com/wiki/Truth

"The opposite of a correct statement is a false statement. But the opposite of profound truth may be another profound truth"          -Niels Bohr

"A lie makes a problem part of the future, the truth makes a problem part of the past."                                                                         - Quote from YMCA Camp Marston

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# Hardly anything hard to say about "The Hard Thing About Hard Things"

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I recently read Ben Horowitz's book "The Hard Thing About Hard Things: Building a Business When There Are No Easy Answers",  it was great!  I've read alot of management, marketing and strategy books but  I can honestly say it is the only book I've read that captured any of my experience as a CEO or being in the inner circle with a CEO in a startup.

Einstein once said of his friend Kurt Godel http://en.wikipedia.org/wiki/Kurt_G%C3%B6del that his mere existence brought him happiness. I can say that about this book.

Ben captures five things that are integral to the role yet is never portrayed in the happy crap "small big company with freedom and payouts"  media and journalism stuff...

1) Impossible odds and running out of money (again)

2) Peacetime vs Wartime CEO

3) Firing / laying off friends

4) Lonely decisions (esp:  People Choices)

5) Overwhelming Guilt

Start ups are hard... it helps to be naive... why do people do it....  not all do...

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# Business Development title is up for grabs

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There's been lots of activity on LinkedIn groups discussing the role of Business Development or BizDev.  I found it interesting since I've occupied this slot and hired/promoted people into the slot.

This is a title that is being used to describe many roles now, including:

1. Inside Sales
2. Territory Sales
3. All or part of Marketing Product Management
4. Social Media content management

and others...

What surprises me is people in the first decade of their career with the title. I am schooled that BizDev is bolted to the CEO or division level executive leadership and working 3-10 years out. Self-driving cars, contact lenses and fiber to the home is BizDev for Google.

What are you going to do when your market saturates? All products, markets and industries mature and create challenges for the leadership. I believe the role should be led by people after accomplishments in Marketing/Sales and General Management with solid foundations in finance and some law. They should be able to sell stakeholders on how taking an "out of bounds" risk makes sense and be able to manage an acquisition or divestiture.

It is sometimes a convenient title for  founders if the company grows up around them. This is fine if they grow into the role. Don't mistake a practical people decision with the strategic role longer term.

Worst case I see the title sometimes being used to avoid using "sales" in someones title, the dead giveaway here is when the title is assigned with  1 year sales metrics.

Sloppy strategic thinking...

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# Asymptotic Thinking

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What if... a single machine could provide all of the goods and services that a country's economy currently produces?   Would human productivity (GDP per labor hour) be infinity ? Who should own the machine? Google? The government? Goldman Sachs? Would the end state look the same if we built such a machine over 100, 50, 10 or 2 years?

This is not rambling, this is "asymptotic thinking" and I believe it is a pre-requisite to good strategic thinking. In calculus it is

lim_{ p \to \infty} GDP(p)

    where p=human productivity and GDP=Gross Domestic Product.

This thinking is important because we approach limits incrementally from a DIRECTION and in strategy, as well as calculus, the direction matters.  More specifically there can be discontinuities along the path, much like crossing a chasm in product marketing.

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# How many strategies are there?

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Twenty?  As many as there are companies?

At the highest level of competitive differentiation there are 3 (but it is still hard to get it right).

Technology changes...strategy doesn't.  Change happens faster....strategy doesn't.

THE WORLD'S MOST FAMOUS BUSINESS-SCHOOL PROFESSOR IS FED UP WITH CEOS WHO CLAIM THAT THE WORLD CHANGES TOO FAST FOR THEIR COMPANIES TO HAVE A LONG-TERM STRATEGY. IF YOU WANT TO MAKE A DIFFERENCE AS A LEADER, YOU'VE GOT TO MAKE TIME FOR STRATEGY.

http://www.fastcompany.com/42485/michael-porters-big-ideas

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# "Plan" vs "Strategic Plan"

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What's the difference between a plan and a strategic plan? Most companies, departments and people have a plan. So what's unique about adding the word "Strategic". It is not just an adjective, added to appear more sophisticated or smarter. It should change the content and mold objectives as well as articulate action steps.

Here's why:

1) Critical Environmental variables WILL change over the "planning horizon"

2) Actual outcomes will MOST LIKELY be different (sometimes  a lot, sometimes a little)

3) It should FORBID certain resource allocations to enhance the CONCENTRATION of them

4) Plans are NEVER FULLY ACHIEVED  but assume a next interval of time sequence

A "Plan" can assume the critical environment it is operating in will remain relatively stable over the "planning horizon". A "Strategic Plan" cannot and should not. Liddell Hart in his military strategy classic has a chapter on "The Concentrated Essence of Strategy and Tactics".  Out of 8 items he includes "Take a line of operation which offers alternative objectives" which is rarely understood among business strategic planners.

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