I have been on a strategy kick lately—not having a strategy, getting feedback on your strategy, focus, strategic clarity, and balancing your portfolio of bets.
Stick with me while I explore strategy.
This post is about a common problem: yo-yo strategies. Does your company change strategy every six months? Do things feel highly reactive? Is your team experiencing whiplash as it responds to the latest shifts?
You have a yo-yo strategy.
Here are a couple of things that might be contributing to the problem:
What you are seeing is not a strategy. You are witnessing tactics masquerading as strategy. The tactics change so often because a) tactics DO change often, and b) there's no strategy grounding those tactics.
Premature convergence. The team hastily pulls something together in a rush to have something ready for annual and bi-annual cycles. The new strategy inevitably suffers from recency bias, rushed research, and a lack of real buy-in. You know you're suffering from premature convergence when people want to challenge the strategy, but there is a sense that "the ship has sailed."
Recency bias. Recent events (lost deals, won deals, feedback, etc.) overly bias strategic decisions. This phenomenon is especially true for companies that close most of their business at quarter or year's end.
Many companies struggle with an "elephant in the room" dilemma (e.g., growth expectations, investor pressure, valuations, sizing the market, pivotal product decisions, etc.). Instead of facing those issues head-on, it is much easier to keep shuffling through interim strategies in the hope that something will magically make the core issue disappear. In fairness, this happens sometimes!
If you need to shift your strategy often, you're probably not seeing results with your existing strategy. The problem feeds into itself.
Layering. A strategy is typically a mix of more stable and less stable/faster-changing components. If everything changes often, you likely lack a "core" that changes less frequently.
The strategy is too vague and lacks an actual diagnosis. It isn't actionable. There's nothing wrong with a team tackling a nebulous strategic problem. Still, it doesn't constitute a strategy that can be rolled out across the organization (unless you are a smaller startup). You can think of strategy as a portfolio of strategies—some more stable than others.
Watered down strategy. Instead of feedback cycles sharpening the strategy, you end up with a strategy that either a) reinforces the status quo or b) is too vague to mean anything (#7), or c) contains everyone’s pet projects (“oh that, I guess it relates to New Strategy!”) This dynamic is pervasive when there are insufficient opportunities to workshop and respectfully pressure test and critique the strategy. Teams also gravitate to more general strategies when they’re concerned about optics. No one wants to tell their team that the market is smaller than expected or that the people hired to focus on X may no longer be a priority.
Unsure what is working and why. You tend to see a cycle of reactive strategic shifts when a team has no idea if anything is working (or why it is working).
Whiplash. When a team ping-pongs between new strategies, it can take weeks or even months to pivot to the new thing. Before you know it, people are looking for results, and there's nothing much to show for it (yet). The result: "We have to change our strategy!"
Difficulty executing. Was the old strategy the wrong strategy? Or did the team have trouble executing the strategy? In many cases, the old strategy never had a fair shot. Instead of addressing that problem, the team keeps making reactive strategic pivots. Of course, this ends up making matters worse because of #10.
Lack of continuous learning and research. You'll be all over the place if you need to spin up new research efforts every time you feel a strategy shift is in order. This pitfall is how you end up with strategies containing a "research phase."
A good first step might be to review these items and ask yourself, “what am I seeing?” It is very rare to find a single root cause, but you might consider narrowing your focus.
Many of the items are related. For example:
elephant in the room issue (#4)
premature convergence (#2)
watered down strategy (#8)
difficulty having a breakthrough on your elephant in the room issue (#4)
I am going to cover some potential fixes in another post, but for now maybe take a shot at figuring out which of the twelve issues you are experiencing.
A handy infographic:
So much goodness in a single post.
Whiplash: very easy for early stage startups to fall into this given market narrative pushes, "learn fast, iterate". Also very difficult to say no to opportunities that may be veering from the larger vision.