02 | Mastering strategy: Laying the foundations for a coherent diagnosis
2️⃣ ✨ 🚀 This is the 2nd article of my series on mastering strategy!
In my previous article, I’ve laid out the core elements for a successful strategy from my perspective. Now, we dive deeper into the first – and most important – element: the art of creating a coherent diagnosis.
Just as a doctor assesses symptoms to diagnose an illness accurately, a successful strategist must identify the root causes of business challenges to prescribe the most effective solutions.
In this article, we fill focus on laying the foundations to creating a coherent diagnosis, i.e. how to tackle the required research. We will cover
- the importance of research for a coherent diagnosis,
- tipps to balance research effort and insights,
- factors to consider for your diagnosis, and
- the role of frameworks for the diagnosis.
Let’s go! 🚀
Coherent diagnosis requires good research
👨🏼🏫 To counter the “I already know what I’m doing” attitude of managers, my mentor likes to quote W. Edwards Deming. And I think he’s right.
Without data you are just another person with an opinion.
Strategy is about taking well-reasoned decisions. You can put a lot of smart people into a room, let them write down a couple of assumptions and call that a strategy. However, it’s simply too likely that these assumptions don’t match the business reality.
Thus, you need to invest in discovery to set the base for systematically good strategic decisions. I like the term diagnosis that Richard Rumelt uses in “Good Strategy, Bad Strategy” to express how strategists should draw research-based conclusions about where and how to act as a company.
Companies tend to underinvest in diagnosis and don’t reevaluate
To me, it seems that companies overrate their market insights when developing strategy. It’s just too tempting to jump straight into initiatives and policies instead of spending hours crunching numbers…