Saturday, September 29, 2018


I did quite a few courses on "Strategy" during my MBA. I find strategy intriguing, complex, and at many times misunderstood. While I ain't giving a lecture on strategy now, I have been increasingly amused and amazed by the fact that - strategy is too damn difficult and most of us (including me) just don't get it.

Organizations are resource constrained. When I say resource I practically mean - we have a limited no. of people (employees/ partners/ contractors), very limited amount of time (8 - 10 man-hours a day, 5 days a week), and a very limited amount of money. As an organization, you are expected to increase that limited amount of money that you have and generate some more of it, by using the other two resources - people and time all while competing in an externally uncontrolled environment.

For me (the layman) a very important aspect of strategy is - how best you can utilize your time and people everyday so that you can generate increasing amount of money for eternity. Deceptively simple. Period.

Strategy is not an one off thing you do beginning of the year in a resort and then forget about it. But the complexity of executing strategy lies in the fact that every person in an organization can spend her 8 hours of the day doing things that may or may not contribute to money for the organization in the future. This may either be because of alignment problem (lower level people's work is not aligned with overall organization's strategy) or the operational employees are not strategically "managed" (When I say managed, I mean specifically told what NOT to do).  

Let's talk about a very practical function - Sales. A VP of Sales (let's call her Priya) for an Enterprise Software Company. Now Priya has 8 hours in a day. She has 100 prospects that she can reach out. Depending on her territory - she might have the option to go after a specific industry, sell a specific product, and focus on a specific geography. Whatever she chooses, she inherently is taking a risk. That's because every choice of her limits the options. Which means if  she is going after one prospect, she ain't going after 99 others. Every time she focuses her energy on something, she is effectively not doing so many other things that might also have led the company to a better outcome.

The problem with strategy in hindsight is - everything seems to be done with a reason. However, in reality, outcomes are a gamble that everyone takes. The successful gambles give us the survivor-ship bias. No one thinks about what would be the state had they taken the other options.

It's fascinating how many times we go after the wrong opportunity, spend time chasing the wrong customer, selling the wrong product in the wrong market.

I feel strategy should be though of more in terms of - What are we NOT going to do. Most people and organizations I have come across have trouble in choosing what not to do. No wonder, so many employees are so busy doing things that ultimately do not bring any value to the organizations' ultimate pursuit of making money and growing.

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