The five enigmas of strategic planning
Strategy is part science (based on fact) and part art (based on ideas). The result is that there is no one right answer. However, there are some wrong ones, and I have listed the five common causes below.
1. Top of the list is the fact that most strategies fail, because the market (people) did not do what we expected it to. We treat every initiative as if the consumer behaves subject to the ‘economic man’ model. People do not think in a reasonable way and very often they can’t even explain their behaviour.
There are times when people do behave subject to the normal demand curve – when prices go down, demand goes up. That’s why we have sales. That works fine most of the time, but reducing prices, adding more features etc befuddles us when the market does not respond in the way we expected it to.
2. Not sticking to the 55/5 rule. Although of unknown origin, this quote attributed to Einstein explains it nicely:
“If I had one hour to save the world, I would spend 55 minutes thinking about the problem and 5 minutes thinking about solutions”
We often just take briefs without doing the literal spadework – digging for what the real problem is as opposed to force-fitting our brilliant solutions to a brief that demands superficial outcomes such as increased awareness.
3. Making E3 errors. Simply stated this is solving the wrong problem precisely. Refer to point 2.
4. Searching for the magic silver bullet insight. Sometimes solutions are based on insights (depending on how you define the term), but if you have isolated the problem, brilliant strategies can be based on something as mundane as a product feature.
5. Blinding yourself with data. I have even seen a presentation where the female market was identified as the target market, as they made up a whopping 40% of the total market. Think about that.
Data can be dangerous
If we took all married couples, we would find that the average person has one testicle and one breast (assuming same sex marriages occur equally for men and women). Data can be dangerous – Steve Jobs went for the iPod simply because everyone listened to music, no one had got it right and the market was growing. He even quoted Henry Ford: “If I asked my customer what they wanted they would have just said a faster horse”.
Strategy is a high-risk endeavour, because it entails predicting the future. I have yet to see “Clairvoyant wins lottery”.
About the author
Sid Peimer is the Executive Director of the Cape Chamber of Commerce & Industry. His book ‘The Clear Win: Pitching for new business – the strategies that work; the myths that don’t’ can be found on Amazon here