Wednesday, January 15, 2014

emergent strategy or just good strategy?

Presumably we're all familiar with the notion of agile, or emergent, strategy. The key idea being around limiting up-front planning to a minimum viability based on the assumption of impermanence and unpredictability in any given situation.

Emergent strategy is structured in order to be able to quickly adapt to new conditions as they arise.

Perhaps a close cousin of lean principles, much emergent planning theory is loosely based around the Google 70-20-10* formula for product development.

A formula by which 70% of resources are devoted to Google’s core group of revenue generating activities eg search and advertising. The fabled 'googletime' 20% was supposedly allocated to self directed innovation projects that Google staff were encouraged to pursue, while the final 10% was allegedly allocated to scaling up the bits and pieces that showed promise from the 20% time.

*Turns out that the 70-20-10 Google rule is more myth and legend than anything that actually happened in practice but it's nice in theory.

So in the advertising sense, applying 70% of budget and effort towards proven activities, 20% riffing on innovations based on what is known to work and 10% on wild card experiments also sounds good in theory but one would have a hard shift explicitly pushing that idea through with most of our clients, though of course that's not to say that things can't be framed to be palatable while still being somewhat true to the theory.

[So, this is perhaps where the most value can be gained out of so-called brand 'communities'.

By that I mean the tiny fraction of a brands customer base who seem to demonstrate some degree of loyalty.

This requires reframing these customers as an 'asset' rather than an audience.

This is perhaps the hardest thing for the social media marketing fraternity to swallow.]

For instance continually generating a broad range of small-scale low cost experiments, and then scaling up the ones that gain traction in order to innovate.

Again this is nothing new. Make small bets, light small fires etc.

But my question here is really this.

Is this emergent strategy? Is this agile planning?

Or is it just good strategy?

Reading Rumelt again over the holidays I became obsessed with this nugget.

The best strategists don’t choose or decide on a strategy; they design novel responses to challenges.

Given that challenges will always appear because of the inherent unpredictability in any given situation the emergent strategy is simply good strategy.

In fact Rumelt's kernel of good strategy seems to describe emergent strategy better than a appropriation of the Google rule.

The kernel of good strategy being made up of three components:

1. A diagnosis:
The more knowledge you can glean about the problems and the implications of your strategic options, the better equipped you are to tackle a diagnosis.

2. A guiding policy:
A guiding policy is not a set of hard goals. It does not say where the brand wants to go; it's some some general rules or guidelines for helping meet the challenges from the diagnosis.

3. A set of coherent actions:
So, once we have a diagnosis and a guiding policy established, a set of coherent actions is designed to implement the guiding policy.

Rumelt reckons that too many strategists, mistake the guiding policy for the strategy and forget the action element. And I've been guilty of this myself in the past, handballing what I falsely believed to be 'strategies' (ie guiding policies) over to comms planners to map and action.

So emergent strategy is really just good strategy.

And, in fact, strategy is not a thing in itself but is only realised when the three components of the kernel are present.

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