Demystifying Strategy
Strategy is a term that everyone talks about but only a bare minimum know. It’s technically one of the most abused terms of the millenia. Most people and even big leaders confuse strategy with goals. Most people think it’s a plan out of the rabbit’s hole , that will help them achieve something successfully. Most people add fluffy statements to make it sound like a strategy but its again a far cry from reality. Then what exactly is strategy. I kept asking myself this question repeatedly because I kept hearing the word strategy time and again and I wasn’t able to understand what it really means.
But before we even go there, let’s talk about what Don Norman spoke about design in his cult book ‘The design of everyday things’. Norman said that good design is almost always invisible. It tends to achieve what it’s goals and no one really notices. Some of the greatest designs are almost invisible. On the other hand bad design is completely visible to the naked eye. Similarly good strategy is almost invisible and tends to attain the expected goals. Bad strategy is all the more distinctively visible and tends to reflect the inadequacies with which it was crafted. Nevertheless what exactly is strategy?
So IMHO strategy is a plan that involves exploiting the weakness of an operating environment or competition to attain a series of goals. The strategy kernel apparently consists of 3 parts- A comprehensive analysis of the operating environment to discover a set of redundancies in the environment or competition that could be exploited, a plan or a set of guiding principles that help achieve that goal of exploiting the weakness effectively and lastly a set of tactical moves or an action plan on how to go about executing the strategy.
That said most organizations tend to falter in either one of these three stages or end up doing either one of them and end up failing miserably. Larry Bossidy and Professor Ram Charan in their bestseller ‘Execution’ talk about the reasons why most companies aren’t able to execute properly and most of it is because of an inadequate understanding of the underlying strategy or the very lack of it. Going by that logic it would be absolutely appropriate to state that an effective strategy is the only way one can survive the axe of entropy since most of the times the fight is against entropy which people inadvertently don’t realise. Entropy increases with time as per the second law of thermodynamics and thus without an effective strategy and necessary execution it would be almost impossible to beat it.
The only set of entities that beat entropy time and again are creatures no one has heard about. The two effective strategists since the big bang are tardigrades, fungi, virus and bacteria. I’ll talk about virus in particular because they have been in existence for billions of years and still have found a way to survive, thrive and dominate the homosapien kingdom. Now at this point it is important to know that most of the strategies are absolutely flawless. Viruses not only employ strategies that maximize the coding capacity of their small genomes, disguise their mRNA with the same structural elements found in host mRNA, regulate their genome expression in a time- and space-dependent manner, but they have also evolved ways of subverting host cell functions in order to favor their own replication and translation. They are well aware of the operating environment and the corresponding flaws it has and employ effective strategies to hide, survive and multiply within the host body till the pathogen has complete control of the host body and they keep on mutating so no amount of medication can affect them. In a way they are almost invincible. Take a look at the most effective viral strategist-the influenza virus or the common cold virus which has been there for eternity. It is practically unbeatable even after all the research that has gone down into creating shots. Even with all the technological progress that Marc Andressen keeps talking about we humans have not been able to beat viruses by any measure. They practically rule this world and the Covid pandemic proved that nonetheless.
Interestingly one company that comes to my mind immediately when it comes to crafting effective strategies and executing it would be NVidia. The company has been there since Intel started the chip revolution after Fairchild semiconductor perished. Instead of competing with Intel on designing microprocessors, it started focusing on Intel’s weakness. That’s where it found out a flaw not only in Intel’s strategy but also an overall flaw in the entire market that could be well exploited. Nobody at that time was focusing on graphic chips or GPUs and NVidia knew that the gaming and multimedia market is going to explode in the future and that would be when there would be exponential demand for graphic chips and so it put forth its best teams to create the best GPUs. After a series of failures they finally managed to pull a GPU that was quite powerful and brought it to the market and the rest as they say is history. if that’s where things would have stopped, NVidia also put in billions of dollars in the AI game to create chips that could power high volume AI LLMs like chatGPT. Today most of openAI’s LLMs or large language models run on NVidia’s chips. CEO Jensen Huang is perhaps the only visionary we have in the 21st century who could see the future light years away and act accordingly or as Sun Tzu says “To subdue the enemy without fighting is the acme of skill.”
So if one were to become unbeatable at strategy, then it’s imperative to follow all three postulates of the strategy kernel effectively to exploit the underlying weaknesses of the system or competition but at the same time be flexible enough to change the strategy if the environment changes. That’s what was effectively shown in the Tom Cruise flick ‘Edge of Tomorrow’ where the aliens who could see the future would constantly change their strategies to win the war against humans till Cruise discovers that. An effective strategist has his eyes on the future and his mind in the present while he is learning from the past.
Thoughts?
