Making Nice Technique: Arguing for Organizational Benefit
by Jesper B. Sørensen and Glenn R. Carroll, Columbia College Press, 2021
There isn’t any scarcity of theories relating to the right foundation for a successful company technique. You possibly can set sail on blue oceans with W. Chan Kim and Renée Mauborgne, hone core competences with C.Okay. Prahalad and Gary Hamel, and get aggressive with Michael Porter, to name out just some of the trendy choices. However how do you rework the theories into a novel technique able to driving your organization’s long-term success?
That is the query Stanford enterprise college professors Jesper Sørensen and Glenn Carroll handle in Making Nice Technique. It’s a guide about strategic due diligence. And it fills an essential hole within the literature by caring not a whit about an organization’s technique per se, however somewhat focusing totally on how rigorously that technique has been formulated and the way completely it has been vetted.
Towards this finish, Sørensen and Carroll outline technique as a logical argument that coherently articulates “how the agency’s sources and actions mix with exterior situations to permit it to create and seize worth.” They additional assert that “the event, communication, and upkeep of a technique argument is greatest achieved by means of an open strategy of really arguing inside the group, participating in productive debate.”
Sørensen and Carroll discover that in lots of firms this strategy of argumentation is both altogether lacking or poorly carried out. As an alternative of utilizing logical argument, choices about technique are sometimes dictated by essentially the most highly effective individuals within the room. Or, when they’re made extra democratically, they’re chosen in a rigged or in any other case flawed method. The authors’ insights assist clarify the findings of a 2019 survey by Technique&, PwC’s technique consulting group, during which solely 37 % of 6,000 government respondents mentioned that their firm had a well-defined technique, and solely 35 % believed their firm’s technique would result in success.
Making Nice Technique is devoted to the instruments for — and nuts and bolts of — making and making use of a technique argument. The instruments are these of the logician and thinker, that are (in more and more uncommon situations) taught to undergraduates in liberal arts however principally uncared for in enterprise faculties, which normally depend on enterprise case evaluation to show technique. “We advocate a distinct mentality for serious about technique, one which celebrates the worth of disciplined reasoning and locations constructive argumentation on the heart of the strategic course of,” write Sørensen and Carroll. “To assist flip this mentality into follow, we provide a versatile system of three core actions: (1) iterative visualization, (2) logical formalization, and (3) constructive engagement and debate with others.”
We advocate a distinct mentality for serious about technique, one which celebrates the worth of disciplined reasoning and locations constructive argumentation on the heart of the strategic course of.”
Iterative visualization is achieved by creating a technique map, which tracks a proposed technique’s causal path backward from its desired consequence to the components required to make it occur. The authors illustrate this course of by producing a technique map primarily based on statements about Walmart’s low-cost mannequin, which enabled the retailer to draw prospects and vanquish rivals within the pre-digital economic system. Working backward from the specified consequence of low prices, they map two of its enablers: operational efficiencies and a bargaining benefit over suppliers. In flip, they enumerate the enablers of these enablers, which for bargaining embody high-volume buying, negotiating prowess, and personal labels. And so forth.
A technique map is simply step one in making a technique argument. “At this stage,” Sørensen and Carroll clarify, “these statements are simply unfounded claims within the technique argument, and their veracity and significance have but to be demonstrated.” That work begins within the second set of actions — logical formalization.
Logical formalization entails testing the validity and soundness of the premises underlying the statements in a technique map. Right here the authors level to the aggressive responses — or lack thereof — from firms like Nokia when Apple launched the iPhone in 2007. The cellular telephone incumbents evaluated the iPhone’s name reliability and high quality and concluded the brand new system merely wasn’t adequate to pose a aggressive risk, not to mention an existential one. However they didn’t problem their very own argument and its assumptions. Because it turned out, the standard of telephone calls didn’t matter a lot given the iPhone’s superior design and performance. “Incomplete arguments can carry plenty of weight in strategic debates,” warn the authors. “That’s as a result of they attraction to implicit premises within the minds of the listener[s].”
The third set of actions — constructive engagement and debate — is aimed toward socializing the technique argument. Socialization surfaces new challenges and alternate options that enhance technique choices, builds buy-in, and begins to maneuver a technique towards execution. The important thing concepts listed below are to embrace, somewhat than keep away from, argument and to argue in a constructive method — avoiding the sorts of dysfunctional debates that solely produce divisiveness and resistance. “Vigorous argument needs to be inspired and celebrated, supplied that persons are arguing constructively, not arguing blue,” Sørensen and Carroll write. “Arguing blue is about utilizing each trick within the guide to advance your viewpoint, deploying no matter powers of intimidation and persuasion you will have at your disposal.”
An organization’s cultural norms play a big function in its capacity to argue constructively. The authors name out Intel’s “disagree and commit” norm as an exemplar on this regard. Intel managers are anticipated to problem and object whereas a choice is being made. However as soon as it’s made, they’re anticipated to help it wholeheartedly.
Making Nice Technique doesn’t cease there. It goes on to explain how technique arguments apply in situations of excessive uncertainty, how they match into strategic planning processes, and easy methods to talk them internally and externally, in addition to easy methods to elaborate on them — constructing them out and drilling down into them. If you wish to higher perceive easy methods to make the leap from an summary strategic imaginative and prescient to an executable strategic plan, this guide needs to be in your studying listing.