Our own ‘agony uncle’ solves your business problems
The Strategist’s resident problem-solver, Alastair Dryburgh, fields your questions about those stubborn strategic obstacles that accepted wisdom hasn’t managed to overcome.
I am CEO of a technology company, built on the success of our first product line. Now we’re in the early stages of developing a new product, which looks as if it could be even more successful. The problem is that the market for our original product is being invaded by low-cost competitors and we can’t compete. We need to withdraw from it and focus all our efforts on the new product.
Although the numbers show that the decision is a no-brainer, getting everyone behind the strategy is tough. Some on the board believe that we need to offer a full product range, while others say that we should keep the old product because that’s what we built our technology and our reputation on. As a team, we’re going round in circles, which means the necessary focus on our new product is slipping.
What’s your advice?
The real issue here is that there are two conversations going on: one conscious, and the other unconscious. The conscious one is about technology and finance, and it’s taking place between intelligent people sitting in a boardroom dressed in suits. But the other conversation is going on in a cave between people dressed in skins. The problem is, the second conversation is the dominant one.
The world has changed a lot in the past 100,000 years, but our brains have not. Much of our perception and decision-making capability – to put it in terms you will appreciate – isn’t in our software (which is regularly updated), but in our hardware (which isn’t). In a great many ways we still perceive, assess and react to threats and opportunities like the primitive cave-dwellers that we once were.
So look at the question of change from an early human’s point of view. The only way he or she can assess a situation is to apply a simple rule: “If I recognise this, then it means I’ve encountered it before and survived. But if it’s unfamiliar, then it might kill me.”
In other words, it’s the ‘familiarity equals security’ rule. Doing something the way it’s always been done before is comforting when you’re squatting in a cave and wondering when the next meal is going to wander by.
You’re a technology company, which means your native language is engineering. You’re pretty fluent in finance too, because it’s similar – lots of numbers and clear answers. But when faced with something new, your doubting colleagues’ deepest instinct is to do more of what they’re comfortable with. In response, you restate the case for change even more forcefully and present more data to back up your viewpoint, but your cave-dwelling colleagues only feel more threatened by this, and so resist even harder.
Recognise what’s going on beneath the surface and you’ll find a way of dealing with the unconscious conversation. One strategy would be to downplay words such as ‘change’ and ‘threat’ and emphasise words such as ‘safety’ and ‘continuity’.
I can give you a couple of examples of people I know who’ve dealt with similar situations very skillfully. One was the newly appointed head of a professional association. He found the organisation in disarray and in need of radical change to survive. But he made all the changes under a banner of ‘longevity’ – of the organisation and the careers of the people working there – rather than one of ‘radical change’.
And then there was the CEO of a large construction company who asked the question: “How much do we need to grow to remain sustainable?” The answer turned out to be that they had to double in size while abandoninga business that had been central to them for decades. Counter-intuitive approaches, perhaps, but effective.
So understand your inner cave-dweller’s prehistoric thought process. Your new strategy is correct, but until you start talking the cave-dwellers’ own language, you’ll never get back to the hunt and gather new business. TS
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