How great strategists see options others don’t see?
Outthink the Competition is a strategic workshop that organizations can employ to develop creative solutions to disrupt markets and gain sustainable competitive advantage.
Example of a Strategem
#25 – Shed Your Skin Like the Golden Cicada
“Make your front array appear as if you are still holding your position so that the allied force will not suspect your intention and the enemy troops will not dare to attack rashly. Then withdraw your main forces secretly.”
- Create a façade that appears to be the real thing, then move the action somewhere else.
- If you current activity were an empty shell, to where could you move the action?
Business example to research:
- Best Buy profits from service not selling electronics
Part 1 – The Foundation
Part 2 – The New Outthinker Playbook
Part 3 – The 5 Habits of Outthinkers
Part 4 – Apply the Outthinker Process
Part 5 – Rebuilding the Organization from Within
Kaihan describes the IDEAS framework
the central process to Strategic Innovation.
“To change the world you need to change reality, and to change reality you need to change perception, which you engineer with creative language. Here are the five steps to begin changing the world – just follow your IDEAS:
1. Idealize: define an ideal future state of the system
2. Diagnose: identify the key issues that must be addressed to achieve this ideal state
3. Explore: brainstorm creative, out-of-the-box strategies for addressing the issues identified
4. Assess and analyze: evaluate potential strategies to isolate those with the highest potential and then test their value with fact-based analysis
5. Story: wrap the resulting solution into a story that wins the interest and support of the key stakeholders needed to bring the idea to fruition
1) Create a compelling idea: when I spoke to Musk about Space X and asked why he wanted to create a private space company, he said something like, “Because a future in which everyone can get into space is more exciting than one in which only the government can.”
Therefore, you need to describe an ideal situation that appeals to people’s common sense. And keep it really simple. If your description of this ideal future is too complex, then you won’t be able to understand nor explain your project well enough.
2) Diagnose the changes that need to take place: for mankind to evolve from hunting and gathering societies to agricultural ones required two major innovations to occur: 1. the invention of the scratch plough and 2. the domestication of the ox. If we did not have both, we would either be riding oxen to hunt or sweating under the hot sun as we scratched lines too short to plant seeds in. For bold ideas to be realized, it usually requires that multiple parts of the system undergo radical change.
Musk’s vision of an electric car that could travel halfway across the country on one charge between breakfast and bedtime requires not only breakthroughs in battery technology but also the creation of a system of “gas stations” at which drivers can stop to swap out batteries. It requires the passing of new laws and regulations to encourage electric vehicles. It’s a multifaceted problem that seems impossible if you view these challenges as reasons the idea won’t work. However, if you view them as variables in the system that you can influence, then they become simply part of the puzzle.
3) Explore possible solutions: having identified the various interconnected elements that need to change, you must now explore never-before-tried solutions. The breakthrough usually occurs through an analogy or metaphor. Yunus, for example, banged his head against the banking sector, which refused to accept his idea of microcredit. His dream became reality when he stopped viewing his project as a social plan but rather as a bank for the poor. Then all of the previously insurmountable problems revealed simple solutions.
A key difference between innovative companies and less innovative ones is defined by what they decide to do with seemingly improbable ideas. It makes sense to focus your attention only on the ideas that are feasible and, indeed, this is what most companies do. But more innovative companies keep “crazy” ideas on the table. They invest time exploring whether these ideas may become feasible.
To avoid your team’s tendency to discard ideas that seem initially “crazy,” it helps to break down your process of choosing from the ideas you generated during the “Exploration” phase into two steps, carefully managing each to give truly innovative solutions a chance.
4) Assess the benefits and consequences: Since you do not have time to test all of your ideas with rigorous analysis, you must first conduct an initial assessment to decide which are worth the effort. Many great ideas die at this early phase, because, upon initial assessment, the team rules them out. Why did it take HP decades to adopt a version of Dell’s “go direct” model? Why did it take American Airlines, Delta, and other traditional airlines 30 years to mount a meaningful counter to Southwest’s budget airline model?
Great companies fail to adopt great ideas because, initially at least, they fail to recognize an innovative idea as holding strategic value. They are not even willing to invest the time to measure the idea’s risks and reward potential.
To help your group avoid its natural tendency to rule out ideas that initially appear “crazy,” it helps to assess your ideas across two unrelated dimensions. I call these the “path” and the “ease.” The goal is to find a way to win with the least amount of effort and find the path of greatest ease.
The Path is defined by the impact the idea would have on achieving your goals. If you had a magic wand with which you could achieve every idea you conceived, which ones would prove to be the most impactful and profitable? Judge those ideas using a scale of high, medium, and low to the impact they can have on your organization’s path.
Then assess the Ease with which you could realize each idea. Consider how little it will cost, how quickly it can be implemented, if your organization has the capabilities or knowledge to do so, and how complex execution will be. Again judge the achievability of each idea as high (low
Are all outthinkers found in high-tech industries?
Kaihan Krippendorff – author of Outthink the competition – describes how Urban Outfitters was able to bring strategic innovation to bear in a very traditional industry: high street apparel retail.
In his book Kaihan sets out how to apply Asian strategic thinking from 500 AD to modern day business situations and describes the 36 strategems,
Kaihan has identified that there are 5 key strategems that have been applied in modern Business to get ahead of the pack.
He has developed a set of frameworks and methods that I am calling the “Kaihan Kitbag”
You can either attend one of his workshops or read his book to find out more about the secret sauce that winners need to apply.