Tag Archives: strategy

Decisions Are Not Made Through Consensus

I don´t believe in committees.

I don´t believe in creative circle jerks.

I don´t believe in finding consensus.

I believe in getting shit done.

That requires collaboration but combined with firm decision-making.

Shared responsibility usually means no responsibility.

Opinions are like assholes, everyone has one and usually you want to smell only your own one.

Plus ideas are like farts.

Good strategy is about making choice.

And usually making choice means that there are opposing views. Some views will be supported and some won´t. And that is ok. In well-functioning organization you are listened but you also know who makes the decision. Opinions are listened, but not everyone is decision maker. Who makes the decision also holds the responsibility of the outcomes.

Consensus means no ownership. What’s important is not that everyone agrees, but that everyone is heard and then the right person makes a decision.

Gokul Rajaram, Square

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Strategy is Making The Choice

Roger Martin sums up beautifully what strategy is:

The very essence of strategy is explicit, purposeful choice.

Strategy is saying explicitly, proactively: “We’re going to do these things and not those things for these reasons.”

You only know that you’ve made a real strategic choice if you can say the opposite of what that choice is, and it’s not stupid.

This is the reason why so many brands fail. They are too afraid to make choices. If you are not premium and if you are not cost-cutter, you fall in the middle. And being in the middle is not a choice, it is indecisiveness.

Choices are not always easy. Making a choice is making a sacrifice. But you have also the opportunity to gain something. If you don´t make a choice you end up with nothing.

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The Rest I Have Learned About Business is From Basketball


Everything I have learned about business, I have learned in basketball court (with some additional help from Wu-Tang Clan). Whether it has been great (or usually horrible) leadership, importance of the team or the value of hard work. This recent incident is a good proof of that:

Detroit Pistons waived their highest paid player and star Josh Smith at the end of December. Waiving is not a little feat, because waived player is included in team salary. The results have been interesting: Pistons has been on a 8-1 winning run only losing to the hottest team in NBA right now: Atlanta Hawks. Interestingly Josh Smith has been good with his new team Houston Rockets as well, so currently it has been win-win for both the of the participants. What can be learned from this whole episode?

1.Don´t play safe: bold moves will be remembered
Sometimes you have to wake up your whole team with dramatic actions. Stan Van Gundy is not just a coach for Detroit Pistons; he is also their president of basketball operations. Waiving Josh Smith was a demonstration of his power and also a dramatic call for their team to wake up. Was it exactly wise is an another question. He had to do something to catch attention of the team. Off-the court jury is still out for Van Gundy´s strategic perspective but on the court his defensive instructions on the video below have strategic clarity that only a few business leaders (or even coaches) have:

2.Even a bad plan is better than no plan
You cannot totally fault bad Pistons season start on Josh Smith and to say so is ludicrous. They did not have proper plan in the place for the team when he was there. Josh Smith had to play a role that did not suit his skills set. When he was waived from the team, Detroit Pistons was forced to have a different game plan and missing one key player made putting a coherent plan into action much easier.

3.Take the responsibility: You either sink or swim
You can never underestimate the importance of mental aspect of sports or business. You need to feel that you are contributing to the team. Because Josh Smith was gone, the rest of the team had to rise up. Other option would have been to tank. The season is now on halfway, so the newly established Pistons can still be a boom or bust. Currently it seems that they have regained their self-esteem and if they continue like this can even make it to the play-offs.

4.Failure is an opportunity to reborn
I like Josh Smith as a player, when he is playing right role. No one denies the physical talent he has, but his attitude to the game has been a question. He has showed maturity by asking to come out of bench with Rockets. Being waived is definitely a slap in the face and you definitely want to show that you still have the skills to be a great player.

5.Team can be more (or less) than its parts
Basketball and advertising industry are similar in a way that you can fill your company or team with stars and still suck. Chemistry plays crucial role. Josh Smith is playing in Houston with his longtime friend Dwight Howard, which probably will be a good thing. Sometimes there can be only one rooster in the coop and if there are too many stars fighting for the attention the end results can be disastrous. Many combinations can work on the paper, but if it does not work on the court it does not really matter. Therefore crazy-sounding ideas like waiving your star player can actually make sense on the long run.

How the episode will pan out, we will see at the end of the season. Currently it seems that everyone seems happy with the end result.

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What´s App Facebook? 4 Questions You Need to Ask to Understand The Acquisition of WhatsApp

Facebook´s acquisition of WhatsApp for about 19 billion (!) is the biggest deal ever for venture-capital-backed startup. As far as the money goes, it is naturally mind-boggling amount of cash but strategically I am trying to get my head around this. Four big questions came to my mind, when analyzing the acquisition:

1. What kind of ecosystem Facebook is building?
Currently Facebook is owner of three really strong (and separate) digital platforms: Facebook, Instagram and WhatsApp. Despite launching the ad units in Instagram, the photo platform has been relatively autonomous regarding Facebook. Apparently they will continue similar approach with WhatsApp and even more so as there will be no ads (in foreseeable future) in WhatsApp. See more in question 2 on that matter.
If we compare to Google, who builds their entire product offering under strong Google branding and synergies, Facebook currently resembles more of a venture capitalist and having quite separate and independent entities. Either approach is right or wrong, but at least currently Facebook ecosystem seems quite disjointed compared to the Google one. But maybe they have a bigger plan intact: see question 4.

2. How will Facebook monetize WhatsApp?
On the investor call Facebook mentioned that there would be no ads on WhatsApp and they are mainly concentrating on growth in the near future. Currently WhatsApp is free for one year and then you pay 0.99 for every additional year (and not even in all the markets).  Current business model is not exactly breaking the bank as it has quite limited growth opportunities, but compared to many other social ventures coming from Silicon Valley it is already profitable. From monetization standpoint it is interesting opportunity for Facebook to enter also to the subscription business and test it first with WhatsApp before rolling it to wider.

3. Was it strategically right decision?
Initially buying WhatsApp seemed a rather uninspiring and unsurprising act. More forward-looking would have been buying some emerging mobile instant messaging platform from Asia (Line, KakaoTalk, etc.). Especially as Facebook mentioned that the reach in emerging markets was one of the core reasons for acquiring WhatsApp. Asian mobile instant messaging platforms would have been better fit also to current Facebook monetization strategy as these platforms are currently more open to advertising as well? Cynical view of the strategic importance of the buy was that as the main Facebook platform loses steam the growth and engagement had to be bought to please the investors.

4.  Will there be Facebook Premium in the future?
How much would you pay for your Facebook account?
It might be that the goal of buying Instagram and WhatsApp is eventually to have capabilities to introduce Facebook Premium. This social network would add the best of the Facebook ecosystem and provide value on certain subscription fee. I have been toying around with that idea for a while, but currently it seems more reality than ever before. I have been quite disappointed of the unimaginative monetization strategies Facebook has had (overtly media-focused) and venturing to subscription models without endangering the crown jewel of free Facebook seems lucrative and interesting option.

The reaction from the markets to the acquisition was slightly disappointed and Facebook stock plunged slightly.

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Decision Paralysis in Hawker Centre

Singapore is a tremendous place for foodie. I am especially fond of the concept of Hawker centres. For those unfamiliar, they are open air food complexes serving great but inexpensive food. I try to visit new stalls and new centres every week and try out new dishes.

In the beginning, my knowledge of local dishes was fairly limited. I wanted to test out new food, but as the hawker stall can be quite hectic place especially during the lunch hour, I nearly always made similar order (prawn noodles, to be precise). So after getting worried about my diet getting too monotonous, I made a simple rule to guide my lunch decision-making:

Only buy from Hawker stalls which sell only one food item.

The reasoning was two-folded:

1. If stall can make living by only selling one dish, the dish must be pretty good.

2. When you have only one alternative, your decision process is quite straightforward.

What I experienced on the stalls offering too many alternatives, was decision paralysis. And many times I still experience that. So it is probably me blocking the queue at the stall when not able to make my mind up between Mee Siam and Mee Rebus. Sorry.

The more you give alternatives to customer, the more difficult it is to make the decision and more likely that customer sticks to his learned formula of behavior. So if you have accustomed to eat chicken rice, the more new alternatives you get the more likely you are to stick with that chicken rice.

This raises couple of issues to companies. If you have only one product, the customer selection is definitely easy. It is also easy to decide against your product. So you have to have variety to address different target audience needs. However, the more you add alternatives the more difficult the selection becomes. In FMCG this usually also results to product cannibalization. The category variants do not take market share from competitor products but actually eat up the market share of your core product. Companies have to provide variety but also easy decision at the same time. Below are couple of tips to overcome this paradox.

How you can help clients to overcome decision paralysis?

1. Recommend

How many times have you taken Chef´s Special in the restaurant? If customer seems hesitant, ask and recommend. Whether you are hawker stall owner or webstore, you are also expert of your products. Highlight that expertise and make qualified recommendation to your client.

2. Show popularity

When showing Top 5 of the most popular dishes, the probabilities are quite high that the customer selects  some of them. Or just check the most popular media sites, they are always highlighting the most read stories. Popularity is a cue of superiority and it helps to make decisions.

3. Encourage word-of-mouth

Only times when I have varied from my hawker stall selection criteria was when I had recommendation from my friend or read a story about certain stall or dish on Straits Times. There is no shortcut for positive feedback. You have to provide good experience and the word-of-mouth will follow. In digital sphere you can make recommendations more visible with social media integration (showing Facebook likes, comments, FourSquare check-ins or Twitter updates regarding your company).

4. Help customer to apply his decision making rules

“I always buy the cheapest”, “I always buy the most expensive”, “I always try the new dish” or “I always eat beef on Fridays”. These are some of the rules your customer might use when selecting products. When you highlight those different motivational triggers, you make your customers selection easier. To exactly know the motivation and the rules for your customers, it requires constant monitoring and research of customer habits.

5.  Help customer to make one choice at a time

Some of the decisions are not always easy. There might be thousands of alternatives. Or there might be only couple of alternatives, but thousands different parameters affecting your choice. Especially with more complicated products, it helps if you break the decision to different parts. It is hard to make buying decision right away, but you can always take steps closer to it. Decision making in elections is great example of this, finding the right candidate requires variety of questions affecting various different categories (example: Republican primaries 2012).

Nowadays as I have learned more about different dishes I have ventured to stalls offering more variety. But even then I utilize one simple rule:

Always go to the stalls with the longest queue.

“More choice does not necessarily correlate with more business”

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