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Bound by the Tactical; Blinded by the Strategic

strategy Jul 10, 2012

Do you know what I mean by that title? You should, because we see it every day in the business world.

Sometimes we think too small – we can only think of what we see in front of us – and we are thus bound by the tactical. Other times, our vision is too big – we are out to change the world (but forget we have to pay the rent) – and thus are blinded by the strategic.

Obviously, there are risks on both sides – and focusing too much on one or the other can be our undoing – resulting in running our businesses into the ground. We see so many examples of companies that are either so enamored by the big picture that they lose sight of execution – or, on the flip side, companies that are so execution-oriented that they don’t have the vision to go to the next step.

Two companies that have typically been so execution-oriented that they failed to think of an overall strategy are Sony (with their memory stick technology) and Microsoft (dare I mention the words, “Windows Phone?”).

Non-Strategy, Anyone?

  1. Sony:
    In 1998, Sony came out with its Memory Stick technology – a closed technology format intended to be used only for Sony products (and thus providing extra revenue for the company and, they hoped, a competitive edge for their products). Originally developed for its digital cameras, Sony extended it to most of its other products, such as PlayStation.They came up with a tactical way to keep their revenue up, but they never thought about the strategy – ie. how to get customers to buy into the “stick” format (along the lines of what Steve Jobs did with iTunes and the iPod – a prime example of tactical AND strategic planning). The problem: USB and SD memory were better, cheaper, and far more ubiquitous formats for consumers. Give them credit for “hanging in there” – which they did until 2009 when Sony finally let go of this technology with the release of their smartphone, according to PC Tech Guide and FastCompany.
  2. As for MicrosoftI’ve written about it before:
    They have great technology but have no clear idea of how to release it. They have the tactical stuff down pat, but they have no vision – at least not one that connects with regular people. Just recently releasing their Windows Phone, it seems that they are entering the closed-systems market a little too late – now that people are sold out for either their Android or iPhone. I’m not saying they can’t make a comeback, but it will take a lot of big-vision strategy to make it happen (of course, Microsoft can iterate much more than most companies – it’s good to have billions in reserve!).

Execution? Who needs execution?

There are a slew of dot-com-era companies to choose from when thinking about companies who drowned themselves by thinking of “The Big Picture” only, but let’s focus on one for now.

  1. Kozmo:
    If you don’t remember Kozmo, it was a dot-com startup whose premise was free delivery in one hour of… well, just about everything (DVDs, groceries, a pack of gum, etc.). It seemed like a great idea and quickly found itself with a cult of loyal followers. Jayson Blair writes that backers “invested almost $280 million in the company because they were convinced that it would revolutionize the way people shopped and would earn them large returns on their investments.”Great idea, loyal customers, and excited investors – it’s the perfect combination, right? Wrong. What Kozmo failed to account for was how they were going to keep this business model going – ie. how to make money while delivering items for free. Beyond that, they expanded too far too fast instead of growing steadily. They were enamored by the vision and forgot about the reality. So what happened? I think you can guess. The business went under. Big time. You can read about the nitty-gritty details at CNN Money Watch.
  2. Another company that was blinded by the strategic was Covisint:
    Started in 2000 by GM, Ford, and DaimlerChrysler (and now owned by Compuware Corporation), the company had hoped to become the business transaction “hub” for the automotive industry as B2B supplier exchange. Many were watching closely, thinking it would soon dominate the market. The reality? According to an E-business Watch case study, they aimed to “specialize in everything.” Their ambitions were too broad, they weren’t “in touch” with the state of the industry, and their management was poor. It collapsed in 2004, but Compuware Corporation is trying to revitalize it in the healthcare and oil and gas industries, among others.

So what do we need in order to stay tactical while thinking strategically?

The first step in balancing the two is to know where your strengths are – or, in other words, know thyself. Do you find yourself talking about strategy most of the day, or are you on the computer for hours doing the tactical stuff?

Once you figure out where you spend most of your time, balance it out. Actually put it on your schedule. If you’re a vision-caster, then make sure you schedule a time for reviewing those pesky tactical things – the day-to-day tasks that matter. It might even be as blunt as, “Monday from 2-4 pm is Tactical Time.” For instance, I realized recently that I was focusing so much on the big picture, that I was failing to do the simple, daily tasks like making sales calls. So I told my team in a meeting that my new goal was to make five NEW sales calls per week.

Likewise, if you’re always focused on doing, make sure the things you are doing fit in with the overall mission of your company. Bring it up in every meeting, and ask, “Is doing Y getting us to Z, or is it just busywork?” Ask someone (or your entire team) to keep you accountable to the bigger picture.

In the end, it’s all a balancing act.

  • How do you strike the strategic/tactical balance?
  • What companies have you seen do this balancing act well?
    Or
  • What companies have recovered themselves by finding the balance?
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