How to level your strategic thinking this week
How to level your strategic thinking this week
Three frameworks that you can apply during your regular meetings to transform conversations from tactical to strategic.
Greetings from Vancouver! 👋
In this week’s newsletter, you will learn three frameworks that will help you level up your strategic thinking. You can likely use at least one of these ideas during your week. Applying a new idea rapidly is one of the best ways to internalize learning so take that as your challenge for this week.
Here are three frameworks to help you level up your strategic thinking:
Straight Line (for when you’re tackling a big goal)
Undercurrent (for when you’re uncertain about the future)
Identity Shift (for when you’re looking for a different approach)
Let’s jump right in!
Straight Line Framework
Have you ever noticed how airplanes do not fly in a straight line? Look at this flight plan from Pan Am (now a defunct airline) back in 1981. Notice how flight paths have a slight curvature to them, something that adds time to the flight path.
There’s multiple reasons for the lack of directness. The earth is round, forcing flights to follow an arch in their flight path. Flights are also redirected to avoid high traffic areas or weather patterns that may cause high turbulence.
Our first framework for better strategic thinking is called the “Straight Line” because that is the aim when you’re working towards a goal. Unlike flights, you do not want curvatures in your path to a goal.
You achieve a straight line by working backwards, instead of forwards.
Working forwards means taking your current inputs and increasing them until you hit your goal. If your team closed a million dollars of deals last month with three sales reps, a forward approach tells you that to close two million dollars, you will need six sales reps.
Working backwards means taking the two million dollar goal, and exploring all the paths possible. One path is hiring three more sales reps but there’s others paths such as changing your sales process to leverage more marketing, partnering with other organizations, increasing the average deal size and so forth. Once you map the different paths, you can see which one is the most direct i.e. most straight line.
The problem with the forward method is that you’re limited by the assumptions of the present. While they are true, that doesn’t mean they are necessarily the best assumptions for the future. The backward method frees you from those constraints and allows you to imagine drastically different possibilities.
To use the Straight Line framework, get your team to brainstorm how to work backwards from any of your current goals to see if there are more efficient paths that you haven’t considered. It is a group exercise that will take 20 - 30 minutes but one that can save you exponentially more time.
Unlike flights, the forces that add curvatures to your paths are self-imposed. You’re not dealing with the laws of nature, jet streams or unpredictable weather patterns.
Takeaway: The Straight Line framework is a great way to work backwards from any goal to find the most efficient path to success.
Undercurrents Framework
One of my favorite exercises to run in strategic meetings is the Undercurrents framework. I learned this idea from a strategy expert named Andrew Hollo (who also has a fantastic Substack newsletter).
Imagine you’re looking at a river, with the constant and non-stop flow of water. If you were able to peek deep into the river, you would see that there are multiple currents within the same river. These undercurrents represent the changes happening in the world around us that we often miss.
Many organizations would love to predict the future but alas, that’s a tough way of going about business. Instead, I would argue that we can look at the changes already happening around us, in essence, the undercurrents of your industry.
For example, if you look at the labor market in many Western countries, you would see that there’s not enough workers for all the jobs available. Some of it is due to low birth rates, some of it is due to an aging population and some of it is due to changing interests of workers. Whatever the reason, the undercurrent is one of a tight labor market. What does that mean for your organization?
The Undercurrents framework is great for any strategic decision where the future is uncertain. You can brainstorm about the potential changes that could give you guidance on where to focus your efforts.
If you’re unsure about what products or services would be a good fit over the long term, you could look at how consumer behavior is changing in your industry and then adjust your decisions.
Think of restaurants and how platforms like TikTok and Instagram have forced them to create beautiful looking food because that's what many consumers expect. If you were opening a restaurant today and didn’t put resources into the visual appeal of your plates, you would be setting yourself up for failure.
The river of time may be uncertain but if you peek deep enough, you will see clear undercurrents that can help you make decisions today.
Takeaway: The Undercurrents framework is perfect for making decisions about the future by noticing trends that are already underway in the present.
Identity Shift Framework
Our third framework is ideal for decisions when you need a drastically new way of looking at things.
I wrote previously about how Sears successfully changed their identity from a mail order business to a retail one, allowing them to keep growing into one of the most successful organizations of the 20th century. However, they failed to change their identity in the 1980s and never became Amazon or Walmart, two companies that do very similar things as Sears today.
The Identity Shift is another group exercise where your team can brainstorm how decisions would change if you were in a different business.
Dyson started in the vacuum business but they have changed their identity into one of a technology company who makes hair dryers, fans, heaters and much more. They even attempted to produce their own EV, though that initiative was eventually shut down.
If Dyson maintained their identity as a vacuum producer, all their decisions would be limited within the world. They could imagine how to make a better vacuum (which is valuable) but they wouldn’t consider products outside of this category. By changing their identity, they could take their strengths—innovation, compact products, sleek design—and apply them to other product categories.
If your team is struggling with a decision—what customer segment to focus on, what market to go into, what direction to take—play around with different identities. How would this decision change if you were Y instead of X?
Identities can be tried on like outfits, until you find you one that resonates. Go have fun and see what you notice in the mirror.
Takeaway: The Identity Shift framework helps you tackle tough decisions by expanding the possibilities of what is possible, all by imagining your organization is in a different business.
I hope at least one of the ideas helps you make better strategic decisions this week.
Talk soon,
Ruben