Let’s not underestimate the task of creating a strategy and delivering it (only 50% of strategic initiatives achieve expected success). Product strategies don’t buck this trend, unfortunately, with 50%-80% of product initiatives failing (even if failure is branded as acceptable for learning purposes).
Whether it’s a company or product strategy, a fairly standard process is followed for creation and delivery. The process entails discovering information, setting a goal, and then trying to achieve it. After that, it’s a case of praying and hoping that nothing pops up to derail your plans because strategies are easy to talk about but difficult to master.
People spend a lot of time and energy developing strategies, and then the poor folks tasked with delivery spend even more figuring out how to execute them. After a while, we realize that the strategy is stale and irrelevant, often while we’re still in the middle of executing it. The cycle to create a strategy therefore begins again, with everyone accepting that this is just the way things go roughly every year.
The strategy gap
“The strategy gap” is the term used when things do not go as planned, which is so common it has its own Wikipedia page. It’s a huge problem dogging strategic efforts, with 61% of executives saying that their organization struggles to bridge the gap between strategy formulation and day-to-day delivery.
Albert Einstein defined insanity as doing the same thing over and over again and expecting different results. But this is exactly what many of us do; we formulate product strategies exactly as we’ve always done and ignore the likelihood that what is delivered at the end won’t meet expectations just like the previous time.
It may be because the “gap" is often unseen, and there aren’t warning signs and announcements telling us to avoid the dangerous space between where we are and where we want to go.
If you Google “ways to succeed with strategies,” you’ll see there are as many opinions on the reasons for strategy failures as there are strategies in this world. When it’s commonly accepted that strategies might not succeed and that you can just wait for the next strategic cycle (or new boss) to make amends, it’s not immediately obvious that there are actions you can take to make them more successful.
Setting your product strategy up for success
It’s possible to close the strategy gap before formulating a product strategy. Even those who accept that experimentation and failure are good learning experiences admit that it’s much nicer to succeed the first time around.
The following three steps will close your strategy gap:
- Design a strategy framework that suits your needs.
- Make feedback and information loops integral.
- Communicate your strategy culture.
1. Strategy framework design: Discovery or delivery
Strategy is neither science nor art. Strategies operate in a world where everything around them can change. For example, there can be sudden technological innovations or supply chain shocks. This isn’t helpful in science, where you create a hypothesis and test that with controlled and repeatable experiments. You can hypothesize strategies but not experiment with much rigor, meaning you don’t know if you were right or wrong.
In art, you create something innovative and new. If you are inspired by previous work, your art is put into that genre and understood by an existing fanbase. If you experiment too much with your artistic license or strategic vision, you may struggle to reach your audience with people scratching their heads wondering what you mean.
To find the balance between science and art, the first thing to do is design your strategy. This approach essentially builds “a strategy for your strategy.”
If you’re a startup in the tech sector, using a strategic approach designed for FMCG manufacturing may not be appropriate. Similarly, a public sector infrastructure provider doesn’t need a disruptive user acquisition approach.
By choosing the correct strategic approach, you can have confidence in how big your strategy gap is likely to be because your expectations will be guided by the chosen approach.
How can you actually apply this? Let’s look at some very common strategic methods:
- SWOT analysis
- PESTLE analysis
- Porter's 5 Forces
- OKRs
- Hoshin Kanri Matrix
There is a dividing line in these methods, with some focusing on strategic discovery to work on the right things and some on strategic delivery, i.e., how to make sure actions are taken.
To find the right approach, you can start by deciding whether the focus needs to be on discovery or delivery.
Diagram 1: Strategic approach map.
Diagram 1 is a strategic approach map visualizing the twin axes of how much you need to discover and how well you can deliver. Plotting your organization on this map narrows down the best approach (or combination) for you.
Knowing your discovery needs and delivery capability will also advise how often you should revisit your strategy. If you have low capability in execution and lack knowledge of market dynamics, it indicates that strategic reviews should happen more frequently, and a careful experimental approach should be taken.
You may have to take different approaches depending on the varying areas of your business. An R&D unit would be working on a more experimental frame and the cash cow product in the offering would be looking at executing faster and more efficiently.
Having different portfolios adds a layer of complexity, but this can be managed with a clear portfolio-level strategy and management approach.
2. Integrate feedback and information loops
If you had all the information available to you and could see into the future, you would make the perfect strategy and have total confidence in your delivery.
The next best thing after precognition is to allow new information to be utilized quickly in both discovery and delivery. Strategies die when this information flow breaks down, and either side fails to pass on information.
Therefore, to keep your strategy alive and kicking, you need a tight feedback loop in which information can be distributed quickly to adjust expectations. This might mean adjusting your strategy or how you expect it to be delivered.
Firstly, design your approach so that new information, both external and internal, meet at the intersection of your strategic discovery and delivery work, as shown in diagram 2 below.
New information can mean a sudden drop in demand or a new competitor. Internal information can also be uncovered inside your organization, like a better understanding of the effort required in delivery.
Diagram 2: Information circling the feedback loop.
As information flows, you will spot signals that could lead to a strategy gap, such as external information changing the scope and requirements of work or internal information about how difficult it is to implement a feature in a customer. If you see a strategy gap opening and can’t spot where the problem is, this is a signal that you need to tighten your feedback loop.
Designing your approach based on continuous feedback has echoes of Lean and Agile principles. In Lean, a key principle is Jidoka, where to avoid waste in a process if something is wrong, the whole production line is completely stopped and problem-solving takes place.
This is reflected in the Agile manifesto, with the statement that we should value “responding to change over following a plan.” This is just a different way of saying that smaller, faster feedback loops provide greater value.
Creating a tighter loop means bringing people and knowledge together for better and faster decision-making. In turn, this helps you adjust your strategy quickly before things go in the wrong direction.
When you eventually need to perform a gap analysis (an excellent technique to draw out the causes), you’ll be in a stronger position from the start with better data.
3. Communicate your strategy culture
New information and feedback are only useful if your strategy and its delivery are open to changes. Openness for change is a kind of “culture.”
That isn’t to say it’s wrong if your strategy does not change frequently; the key point is that you communicate how people can interact with the strategy.
Culture can include how cross-functional teams collaborate on strategic efforts and how high a priority the strategic program should take in people’s day-to-day work. Upfront communication upon the launch of a strategy and during its implementation will ease decision-making and collaboration at all levels.
Ready to create your product strategy?
Now that you’re aware of the strategy gap and how to avoid it, you can move on to creating your own strategy with a tight feedback loop. In parallel, you can open the discussion with your teams about your strategic culture to get it established and flourishing.
The strategy gap is not unavoidable, and every team has what it takes to mind the gap and deliver strategy success.
Do you have a different approach to creating your strategy? Let the author know: dan.khurram@eficode.com.
Published: Jun 26, 2024
