Are You Playing To Win?

According to the book “Playing to Win” by A.G. Lafley (Procter and Gamble CEO) and Roger Martin, the “new business normal” is (to borrow a phrase from the US military) a VUCA environment: Volatile, Uncertain, Complex, and Ambiguous. However, most companies do a poor job of creating a “winning strategy” to succeed in a VUCA world.

Here is my personal take on the “Strategy Traps to Avoid” lessons contained in the book:

The “magic vision” strategy

This is where you create a BHAG for your organization, but fail to translate this lofty vision statement into concrete strategic moves. Aspirations are good, but goal-setting is not strategy.

The “copy everyone else” strategy

This is where you chase the same trends all your competitors do; using the same tools and technologies, the same marketing approaches, the same features and benefits, the same customers and geographies, and the same management fads of the era.

Unfortunately, the more your choices look like those of your competitors, the less likely you are to be a winner.

The “something for everyone” strategy

This is where you fail to make a clear choice as to who your target market customer is. Unfortunately, you can’t please everybody, and you shouldn’t even try. As Seth Godin says, “A product for everybody is a product for nobody.”

A winning strategy requires making a clear choice to serve a specific customer segment really well. Yes, you can still sell to other customers who want what you make and are willing to give you money, but only where it doesn’t distract you from your target customer focus, and only where it doesn’t force you to dilute or change your offering.

As my friend Doug Hall says, you must, “Delight the few to attract the many.”

I teach my clients that strategy requires trade-offs. Your strategic moves should be things that will help you to establish a competitive advantage. Your strategy should help you to create a category or a niche in your industry where you can genuinely claim a position of leadership or a meaningful point of difference. Your strategic moves should make it very clear what you are going to say ‘YES’ to, and by association what you are saying ‘NO’ to, and what you are NOT going to do.

Don’t try to be all things to all people. You can’t be all things to all people. Strategy means saying ‘YES’ to some things and ‘NO’ to other things. It also means saying ‘NO’ to some customers and their demands. If you are saying yes to every type of customer, you don’t really have a strategy.

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 everyone else’s, it’s just a recipe for commoditization and price competition. No company can do everything well, and if you try to do so you will just end up doing everything in a mediocre way.

A winning strategy means focusing your efforts and resources in a way that is distinctly different from your competitors. To win, you need to pick an uncontested “Blue Ocean”; a niche area where you can carve out a chance to win.

Telltale Signs of a Winning Strategy

We should never underestimate the role that luck and fortuitous timing play in the creation of successful companies. Survivorship bias is our tendency to study the people or companies who “survived” or were victorious in a certain situation while ignoring those that failed. In many endeavors, it is probable that the failures used the exact same formula as the winners, but they still failed.

That said, here are some telltale signs that you might be onto a winning strategy:

Your Core Activities look uniquely different from those of your competitors. You don’t try to do everything. You are attempting to deliver value to a specific group of target customers in a distinctive way. You don’t try to be all things to all people. You are very clear about what are you are NOT going to do. You know that the essence of a winning strategy is being able to say ‘NO’.
Some customers love you, while other customers dismiss you as an option straight away. This is a good sign because it means you have made a deliberate choice about who your ideal target market customer is, and your marketing and product/service design reflect this. You are not trying to please 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.”
Your target customers look to you for innovations to make their lives better. This select group of customers remains loyal to you because they feel like you “understand them” and understand their unique needs. They believe you are uniquely positioned to create value for them over the long term.

Even if you think you have a winning strategy, you can’t rest on your laurels because no strategy lasts forever. All companies need to evolve their strategies to stay competitive and, ultimately, to win year after year. Here’s my proven cadence to review and update your strategy regularly.