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The CEO Responsibility

Building and Executing Agile Strategies in Dynamic Environments
by

Bruce Phillips

on 8 March 2015

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Transcript of The CEO Responsibility

Strategic Agility
Context for Agile Strategy
Example -- Pandora
Professor Bruce Phillips
bruce@phillips.co.il

Modified from Fast Strategy by Yves Doz and Mikko Kosonen
Agile Strategic Cycles
Overall positioning drives strategy -- must be kept constant over short cycles

Real competitive advantages (unique values) require significant development cycles

Clear business model and mutually reinforcing value chain are critical enablers for agile strategies
Strategy decks &
Documentation
Collaborations & Conversations
Strategy drives Execution
Strategy & Execution
Quantitative
Research
Qualitative hypothesis testing
Continuous interaction with the environment
Planning
Strategizing
decision -> short cycle execution -> evaluation
annual cycles
every "x" years
Execution = hypothesis testing
Expanded and modified from Hambrick & Frederickson, “Are You Sure You Have a Strategy?” Academy of Management Executive, 2005, Vol. 19, No. 4
4 Common Fallacies About Strategy
1. Planning = strategy
2. Objectives = strategy
3. Analysis creates strategy
4. Execution should match strategy
Strategy as an "Envelope"
Dilemmas
Strategic Choices
Intended
Strategy
Realized
Strategy
Unrealized
Strategy
Emergent
Strategy
Opportunity
Strategic Fit?
Strategic Learning
Planning ≠ Strategy
Objectives ≠ Strategy
Analysis Strategy
Execution rarely "matches" the strategy
Based primarily on the past
Based upon questions about the future
What happens when the environment is dynamic and you cannot fully specify the strategy?
What capabilities enable some companies to rapidly adapt their strategic direction in changing environments?
Agile Strategy
Multi-year Process
Execution = hypothesis testing
Execution = hypothesis testing
Objectives ≠ Strategy
Our strategy is to become the largest
and most profitable company in the
xxx industry by 2020
Our strategy is to double our revenue every 5 years
Our strategy is to become a leading supplier of xxx
Many companies are unable to execute significant changes in strategy
Why?
Strategic agility enables a company to
Sense trends in the environment
Understand the implications of the trends for the company strategy
Reach agreement on a new strategy
Implement the new strategy
What happens when the environment contains significant uncertainty?
Such situations may require
Building strategy around scenarios and/or
An agile approach to developing strategy
ASC
Low-cost ASC Android smartphones sold in China and Asian markets
Limited outsourced manufacturing for global brands
Asian Smartphone Company
Not a real company
Shortening of product lifecycles
Maturity of global smartphone market
Smartphone drove the merging of communication and entertainment; merging of fitness and health into the smartphone has already started
Industry waiting for the next “killer” form factor
Branding drives profitability
Trends
Strategic Implications
Agile product development and production required for frequent product changes
Move from smartphone to other form factors will be required
Profitability depends upon becoming a strong brand
"No Regret Moves"
How fast will the market transition to new form factors?
When the transition occurs, will the big opportunities focus upon flexible, foldable tablet-like devices or upon wearable devices?
Will the new form factors be dominated by the current OS’s (iOS and Android) or will the OS market fragment?
Uncertainties
Make a decision now, based upon the best information available
Build a multi-stage process of testing, sensing, and deciding
OR
The CEO Responsibility
Building and Executing Agile Strategies in Dynamic Environments
From: The Global Challenge: International Human Resource Management by Paul Evans, Vladimir Pucik, Ingmar Bjorkman
Can you build some scenarios to clarify the possible environmental changes and their implications?
Full transcript