The big problem with your strategic plan? Shifts happen.
Look at the calendar. That far along in the year already? It seems only yesterday when your organization started January with a twinkling sense of optimism and a strategic plan that laid out the next 12 months with military precision.
But if your organization is like many, your strategic plan may now seem to have all the worth and relevance of a well-intended but hastily drawn list of New Year’s resolutions. There are the usual reasons for this:
- The plan’s goals fail the SMART test (Specific, Measurable, Agreed-upon, Realistic, Time-based)
- The goals were not chunked into achievable milestones
- You’ve had no routine check-ins to make stakeholders accountable for meeting goals
But most likely there is another reason: The world your team saw at the end of last year already looks different this year. Some shifting has occurred—perhaps in the market, or with internal personnel or other distractions, or maybe in the national economic or political situation or in technology. Today you know things you didn’t or couldn’t have known then.
It’s okay. Shifts happen.
The fact that the world changes, sometimes dramatically, in just a few months is no reason not to have a well-done annual strategic plan. In fact, it’s exactly why having one is so important: knowing what the organization intended at the beginning of the year makes it easier to identify and adjust for the deltas that occur. Having a plan exposes what’s not in the plan.
Dealing with minor interruptions and big black swans takes time and resources from what you thought you’d be doing. Having a strategic roadmap, with clearly defined milestones, makes it easier to determine what trade-offs are needed to adjust. To make the job easier still, try to align each goal with resources and level-of-effort estimates.
In agile methodology, work teams are managed based on their finite capacity. Each job is given some kind of scoring, or weighting, to determine its level of effort relative to others. Most likely, the sum of all the sizings will exceed the available resource capacity to do the work. This forces prioritizing: Whatever doesn’t make it into the release schedule ends up in the backlog. To prioritize the backlog, you can rank the relative business value as well as the cost of delaying the job.
Imagine having a strategic plan where each goal is weighted relative to the others, and job size and cost of delay are mapped in advance. It would be so much easier to deal with the headwinds of new developments and make trade-offs to best utilize limited organizational capacity.
A well-constructed plan can also protect an organization from avoidable headwinds, such as when an influential board member or executive tries to muscle through a request that threatens to throw the enterprise off its plan. A defensible process for establishing and vetting priorities might just impress and inspire the Big Foot to play by the rules.
Shifts will always hit the fan. Or, as John Lennon more artfully sang: “Life is what happens when you’re busy making other plans.”
But a well-drawn strategic agenda, with SMART goals and clearly articulated levels of effort, can limit over-reactions and keep the organization moving forward.
Blockchain: Making cutting-edge your edge
Like most of you, I try to keep up with the incredible pace of emerging technologies around the world. I am always trying to figure out how these technologies can apply to me and to my business/clients. Sometimes it takes a particularly perceptive article to make things clear.
For a while, I have been following blockchain from afar, but had always viewed it through the lens of cryptocurrencies like Bitcoin. While interesting, these are not currently relevant for me personally or professionally. Then I read an article in The New York Times (Blockchain: A Better Way to Track Pork Chops, Bonds, Bad Peanut Butter?) and it became clear how pertinent blockchain could be for any company looking to keep track of inventory by tracing supply issues and more. I highly recommend reading the article, but the summary is that blockchain technology is really just “a bookkeeping method that ‘chains’ together entries so that they are very difficult to modify later. It provides a way for large groups of unrelated companies to jointly keep a secure and reliable record of their transactions.”
Yes, blockchain can be used in currency exchange and to track stocks and bonds, etc. But it can also be used to track any other inventory, physical or virtual. Companies like IBM and Microsoft are developing versions of the technology to solve tracking issue for companies like Maersk and Walmart.
My favorite part of the article describes how, in 2014, a small team at IBM started working with Bitcoin and blockchain on their own, with no real support from the company. Arvind Krishna, the director of the research group at IBM, was ready to shut the project down (cybercurrency is not a key area for IBM) but the group convinced him of the wider application for tracking shipments without needing to rely on a central authority.
From there, the group presented to top executives at IBM and got approval from CEO Virginia Rometty to build a working prototype. Now they are building client-facing solutions for companies like Maersk, to help them avoid fraud and delays around loading and unloading of container ships.
So, what are the learnings from this article? To me, it means constantly looking at cutting-edge technology and digital trends and trying to see use cases that are relevant to my business (or the businesses of my clients). Blockchain is a great example of such a technology, but there are many others that have similar potential possibilities of changing the world. Some of my favorites to explore with clients right now are:
- Virtual/ augmented reality
- Internet of Things
- Autonomous transportation
- Behavioral biometrics
- Voice-based computing
All of these emerging technologies are going to dramatically change the world in the next 10 years. Figuring out how your organization can take advantage of one or more of them would be great food for thought this weekend. Maybe you can become the Arvind Krishna of your organization as a result.
Is your business digitizing or transforming?
Is your company in need of digital transformation – or digitization? There’s an important distinction. With digitization, you’re doing the same thing – albeit in a digital way – but are not producing new results. In fact, this usually just adds costs without increasing revenue. However, digital transformation speaks to the philosophy of rethinking your core categories. It’s a holistic adaptation of processes that touch on all aspects of your business. And it increases your productivity and your revenues.
The transformation journey begins with a rethinking of three core categories: market, products and customers. In this rethink, we’re looking for new opportunities that digital will provide. For an example, let’s look at the recent disruptions in the music industry:
First you bought records on vinyl, and then the record labels digitized them and re-sold them to you on CDs. Once computer memory improved enough to store your tunes, you ripped CDs into your hard drive – and redeployed your CDs as drink coasters. Then, once Internet speeds got fast enough, those downloads became displaced by streaming. Digitization became digital transformation.
Today’s music market is liberated from its geography-bound markets and distribution channels. The game now is more about creating buzz in social media communities of fans in ever-narrowing genres. The market has exploded and fragmented at the same time.
Streaming didn’t just change distribution channels – it also changed the very nature of the product. Today people can purchase a single album (on vinyl, CD or digital download), or stream it via Spotify, Google Play or other services. Sirius XM preserves the radio format, but expands the model with hundreds of channels beaming over all of North America. Terrestrial radio still exists, but listeners can also sample new music via recommendation engines in streaming services or through podcasts.
Technology can expand a customer base in unexpected ways. Pandora, which creates a radio station on the fly based on your tastes, has found an adjacent market of consumers who otherwise wouldn’t be purchasing much music. And soon, virtual reality programming will open up new types of music consumers who want a live musical experience without leaving home.
Once we rethink our core categories, it’s easy to see where new opportunities lie. More difficult is transforming an organization’s internal capabilities to meet those opportunities. Below are some other core elements needed to keep pace with digital transformation:
- Innovation – Enterprises should budget for an appropriate mix of short and long-term investments.
- Data – This is the oil of the digital economy. Any effective organization will need to have this as a core competency.
- Agile execution – Focus on short-term, continuous wins in the service of your longer-term strategic priorities.
- Technology – Of course, the proper technology is essential. Technology needs to be flexible, scalable, responsive and solution-oriented.
How has technology redefined your own market and distribution channels? What new opportunities does digitization allow? What technological market disruption are you missing that might relegate your business to an artifact of the past?
Send thoughts, disruptive comments and CD drink coasters to me at firstname.lastname@example.org.
Doughnuts to dollars–through digital marketing savvy
Digital transformation is popping up in many unexpected ways today. It’s impacting even routine transactions, like buying a doughnut.
Recently I was in a trendy urban food court and was attracted to a display of sinfully rich-looking gourmet doughnuts. I’m not typically a doughnut buyer, but these were particularly difficult to pass by and the salesperson behind the counter convinced me to try one, even though all I really wanted was a cup of coffee.
What happened next started a simple but effective digital cascade of customer engagement I believe is helping this up-and-coming vendor win over customers and build brand loyalty.
“I can swipe your card right here. Would you like an e-receipt?” the salesperson said, holding up an iPhone with a Square scanner. “OK here’s my card, and yes, e-receipt please.” I’d like to think that, in that split second, I determined that heading to the register at the other end of the counter to pay cash was inefficient, and that the e-receipt would be a good way to capture an incidental expense. However, I believe I reacted mostly to the convenience of transacting “in the moment.”
About 15 minutes later after consuming what was indeed an exceptional doughnut, my mobile phone email lit up with the promised receipt together with a clever request for feedback: “We hope you enjoyed your doughnut. Please tell us about your overall experience with us.” I was presented with the simple option to click one, two or three smiley face emojis to express my level of satisfaction. Perfectly timed to get an honest assessment, I clicked three and hit “send.” Instantly I received another email thanking me for my feedback with a coupon for 50% off my next purchase.
So, what happened? The credit card transaction with expressed permission for a receipt triggered a digital relationship opportunity for the vendor — one that was executed particularly well. Will I visit this shop again? The odds just got a lot greater in favor of the vendor. Let’s see why and break this down:
- Attractive physical display, high-traffic location. These are the basics for brick and mortar retail success.
- Friendly salespeople trained to encourage digital transactions. While not only convenient for the customer, this provides the vendor with an opportunity for a digital relationship with their customers—while reducing the risk of a cashbox on site.
- Off-the-shelf technology. Providing iPhones equipped with Square scanners to facilitate sales is easy to implement and manage.
- Perfect timing. Receiving the follow-up receipt 15 minutes after making the purchase was critical in this case. It would not have been effective hours later as the “experience” would not have been fresh in my mind.
- Customer feedback. The vendor did not miss the opportunity to capture the level of their customer’s satisfaction in a simple, nonintrusive way.
- Gamification. While it’s not elaborate, the “click the emojis” was a perfect approach for the simple transaction of buying a doughnut and coffee.
- Reward action, and build loyalty. The vendor generated an opportunity for repeat business with the e-coupon, while rewarding the customer for providing feedback.
The tactics used and lessons learned here can be applied to any business looking to improve how they combine physical presence with digital presence to improve customer experience. This clever vendor sought first to understand their customer’s purchasing journey, and then deployed a sales and digital strategy to engage the customer, build a positive relationship with their brand and encourage repeat business.
More and more businesses are discovering that digital innovation does not require complex or expensive solutions to achieve meaningful impact and results, and they can be applied to many types of transactions, large or small. We’d like to hear from you about other examples of digital innovation in action.
Send me your thoughts at email@example.com.