STAGE 3a) CREATE OPTIONS : GENERATE ALTERNATIVES
"As competition intensifies, the need for creative thinking increases. It is no longer enough to do the same thing better…....no longer enough to be efficient and solve problems."
Edward de Bono
We choose our future when we make our strategy. And how can we make a choice without alternatives?
Generating alternatives can be hard for organisations - so hard they often pay lip-service to it instead of creating genuine choice. There are several reasons:
- It is a waste of time because everyone knows what we are going to do already (“groupthink”)
- Aren’t we better off “focusing on execution” instead of debating theoretical alternatives
- The more radical the alternative, the more change is required...and only a wet baby likes a change!
This is where the creative art of strategy comes in, as we have to imagine the possible ways we could grow our business. It is useful to create an “opportunity” list and continuously add to it during the strategic analysis phase to make sure no ideas get lost, however silly they may appear at the start!
We can overcome groupthink with a structured process:
- Use a comprehensive checklist (like Adjacencies) to ensure all possibilities are covered
- Use voting to narrow down to the best opportunities - require at least 3 alternatives on different dimensions
- Create a different team to work on each one of these alternatives
- Position it as a challenge - explore and pitch our alternative to the best of our abilities, whether we think it is the best one or not (of course, better that they passionately believe in it!)
- Set up a constructive debate, where each team is responsible for challenging and highlighting the flaws in each others proposals
Questions to answer
- What are different ways we could grow?
- What new disruptive business models could we adopt?
- What would our company look like if we adopted a different value discipline?
Example Framework: Adjacencies
This Strategic Growth Model maps out all the ways our business could grow to an adjacent business:
- Improve our existing core business
- New product/service
- New customer segments
- New geographies
- New channels
- New value chain
Adjacencies may be only a single step from our core business today, or they can be more distant. For example, an American business considering international growth, Canada is only 1 step away from the US business, Europe would be 2 steps, Asia would be 3 steps. In general, organic growth should be one step at a time - once we have mastered the first step, we can take the next step with confidence instead of jumping and failing.
To prevent groupthink and ensure each direction gets a full and fair evaluation, allocate each adjacency to a different team or individual.
Good strategic alternatives need to be specific, internally consistent (e.g. the capabilities fit with the value proposition we are trying to deliver) and bold (representing a real different strategy, not just s small incremental tactic).