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Play the game you know you can win

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It’s a competitive world out there.  No one knows this more than an entrepreneur — someone who’s broken away from the pack and started a business. As we’ve written before, the “fail-fast” school of thought is well-respected in the investor community.  Whether failure is determined quickly or not for many years, failure is tough.  Humans don’t like to fail.

In a recent article by Roger Martin in the Harvard Business Review, he explains setting yourself up to succeed is a good idea in some contexts. But it’s usually a bad idea in strategy making.  He writes:

“Think about it. On one hand, you can tackle a difficult challenge and face the prospect of failing. On the other, you can strive for a manageable goal and pretty much guarantee that you’ll achieve it. I would argue that most people systematically choose the second course of action.”

He goes on to explain how this translates in the business world:

“Instead of doing the difficult work of making a coherent set of choices to position themselves to win, most companies default to writing a strategic plan that lists a bunch of initiatives with associated financial projections.”

Martin designed a questionnaire to determine if you’ve fallen into any of the three “comfort traps” of strategic planning.

  1. Strategic planning: They create a long list of to-dos without having a strategy to carry out.
  2. Cost-based thinking: They try to model revenue (which is hard to nail down) the same way they model costs (which are much easier to predict).
  3. Self-referential frameworks: They focus on the company’s existing strengths and its ability to quickly copy rivals’ moves instead of finding a new source of competitive advantage.

 

Complete his short questionnaire here and find out if you’ve fallen into a strategic planning comfort trap!