Despite how much is written about strategy and the money spent on strategy reports of chronic failures persist two causes dominate strategy is still not fully defined and strategy practice is still largely based on a planned view of the world.
Change and innovation however are not wholly planned but emerge from the myriad interactions of the players involved some by design many not, this science of complex adaptive systems must be the bedrock on which strategy is built Our guest's book derives strategy definition, theory, and practice from adaptive systems aimed at corporate business and functional leaders, but broadly applicable.
The approach includes an agile method for strategy framework design that replaces stepwise Chevron methods and presents a new set of tests. Of strategy called the five disqualifiers his book offers no promise of easy transformations, our audience on the innovation show know that does not exist because change and innovation are hard. Sometimes ugly i would say a lot of times ugly with no guarantees.
But with sound principles and discipline organizations can efficiently raise the probability of success. It is a pleasure to welcome after a long wait for this i've been dying to cover this book and he's kind enough to give us a multiple part deep dive into this book because it needs it, the author of the emergent approach to strategy Peter compo welcome to the show.
Thank you very much.
It's so great to have you man i've been dying to cover this book and delighted that we're gonna do, a couple episodes on this because we're gonna need them at least two anyway thought we started with one question first because.
Many people have great intentions they want to listen to the show but a couple of our audience members emailed me and Aidan, would you ever just ask the author at the start of every episode, what is the elevator pitch in a nutshell to give us context and then you can go deep dive in all you want so that's the question to your first, you know those times you might appear nbc or abc over in the states what would you say if you had the five minutes to sell the book
This book is a new theory of strategy. And that new theory of strategy comes from a model of innovation, not from just experience, but a model of innovation. And it leads to a new definition of strategy, not completely new, but. establishes what has been talked about with strategy as a rule. And, it leads to a new understanding and a deeper understanding of tactics versus strategy. And it leads to a better understanding of nested strategies and a hierarchy.
And it leads to a better understanding of what execution is. A non trivial definition of execution. Not just saying execution is getting good results. But all that theory doesn't even have to be used daily because it also has a very much modified practice of strategy where that theory is embedded. in a way to create, design, learn, figure out how to make the change, how to make the innovation you need to reach aspirations. So it's a two part book, New Theory, and then Modified Practice.
I think people can, can connect with it both on a theoretical level and on a practice level, or both.
and one of the things i said to you as well you can connect with this even on a personal level so, you want some i put on the right now i think about it this way, The right hand side which is my aspiration i then i can influence that but i can't control it only through all the inputs from the left hand side and this is the idea of all these influencers that will get you to the end but it does you cannot make it happen and this is something that so many of our audience have
experienced where a CFO or CEO or CEO in an organization will go what's our strategy when will this be profitable and you're like going i don't know all i can control are the inputs never at the outputs and i say that to say also you have experienced this you have.
a quarter of a century's worth of experience in multiple roles which is i think you're really important thing because those multiple leadership roles that you had in dupont gave you this experience to go, i need to see it from every different angle with inside the organization to get a holistic view of strategy and all the blockers that come with maybe you give us a bit of context of that experience, working from those different roles and seeing things from different angles.
Yeah, I think, maybe we could say it's rare, I think, for somebody to write a book that is this theoretical and comprehensive in practice. Who isn't part of an academic situation or one of the large consultancies. And there's reasons for why I ended up doing that, but the 25 years I spent in corporate America, well, of course, DuPont was a large multi national corporation, really did help me understand and get a view that might be different from somebody who saw it from the outside.
As I say I worked in the corporate trenches for, for 25 years. And I had a good view because I tended to work with people at many different levels of, of the organization. I want to add also, and you accepted me having my music studio here as my background, coming from a musical background. Was a big part of this and also in between my musical growing up and being involved with music and then going to corporate America and doing technology and business and operations.
I also got a doctorate in chemical engineering, which gave me a background about scientific invention and innovation. And the key is, though, I saw the same thing in all these areas. I saw the same adaptive view of the world. I same, I saw that change and innovation is an adaptive process in all of it. And a disciplined one. And I think this is one of the biggest. issues for people to address on innovation. The idea that innovation is something about freedom.
Whereas if great musicians and great scientists and great business people, it's not, it's about a discipline, but a special discipline. And you could argue, that's the core of this book, how to turn that into practice, this special discipline into practice.
Let's riff on that excuse the pun on the music because i find the music aspect so so important and are you telling about frank barrett we were out on the show and his book yes to the mess i'll link to it in the show notes for those people who missed it and the emergent nature of jazz particularly for example in the older jazz that as we talked about before we came on air there was no like you record saxophone track we'll mix it then on to the piano or whatever the double bass.
They have to do this. In very short period of time very quickly but as you said it took great discipline on an individual level to be so proficient at their own skill that they could come together and then remix those skills in real time and there's so many different lenses through which you will see as a musician that you see in the corporate world and i know you don't talk about that much in the book but it's so very obvious to me, that that's with you all the time and that you see
the same frameworks through these lenses perhaps even you see notes in real time. i'd love you to share a little bit about that
Yeah, I only was able to, for practical reasons, right? I, I only slipped in a little bit about Charlie Parker at the end of chapter two, and also showed what you've already referred to, right hand, left hand side, this idea of an influence diagram, that there's an emergent outcome side, and then there's the action, what you can do side. And I even designed one for music to just show people how universal that idea is.
But as we were talking briefly before we went on the air, Charlie Parker is revered. And for those who might not know who he was, he was a revolutionary alto saxophone player African American from Kansas City. And he was born in the 1920 and of course migrated to post war 1940s, New York, and became famous in post war New York, which was the center of the universe at the time. And still is, if if you come from New York, you have to believe that, but he was a very, very influential figure.
Jazz musician and created along with some other famous people like Dizzy Gillespie and later Miles Davis and John Coltrane a new genre of jazz called bebop. And it had enormous influence even to this day on, on the progress of jazz and even class, what we call classical music. But the point that we want to get to here, and I think that you're trying to bring out is that Charlie Parker. wasn't just do whatever you feel like doing at all. He had theory. He talked about having to study.
He talked about having to learn, and he had theories of how to improvise over given chord changes, which are the the harmony under, underneath which people improvise. And so he had an enormous discipline and theory about his creative life, which is quite in contrast, which is quite to the way many people think about jazz improvisation or any kind of music or art, right? They think somehow, well, discipline, isn't that kind of the opposite of And it's funny that it's exactly not so.
It is the core to creativity, but it's a special kind of discipline in a certain place and in a certain way. But I think that view of music discipline, and I studied a little composition at the time, early on, and then I see it now as I write music. There's an the enormous need for discipline and creativity, but the right discipline and you're absolutely right. That's been a core throughout the work I've done and what I've captured in this.
i was telling you as well before we came on air about my sports career and i end up playing for one of the best clubs in the world Toulouse in france and they are the exact same people think it's all free they call it Joué which means to play in french this whole style of play. They think it's improv And actually there's a , huge amount of discipline that goes behind that, particularly from the kids that come up through the academy.
They're trained in this way of playing from a , very young age. And it looks like it's all improv, but actually in their head, they've rehearsed these moves time and time again. And when you bring people together that all have that same discipline, that's where the magic happens.
And I say that to say the same happens with this book, because you start off with that exact way that when you talk about strategy, you talk about the constraints of strategy to begin with, what are the things that are wrong with strategy? What are the problems with strategy? And I have a little quote to tee you up . I'll lead a new riff on my lead You write here that it is convenient to blame poor execution for strategies, confusing condition, as in the story of the CEO who said.
Execution eats strategy for lunch if my competitors found my strategy on an airline seat i wouldn't care. But it is hard you say to execute on a powerpoint filled with forecasts, long lists of strategy themes, strategic initiatives and sub goals and directives like deliver each quarter and optimize each allocation. Poor execution may be a problem but it's not the first problem to attack. How can people execute on or be inspired by strategy when strategy seems so misunderstood?
How you open the whole book we do need to address that before we get into solving the challenges
I do believe that strategy is still very much misunderstood, and that doesn't mean that there haven't been improvements. Rumelt, Roger Martin, others, it's definitely moving in a good direction, but I don't think there's a collective understanding that Number one has a clear definition of what a strategy is versus a strategic plan, even. What's the difference between a strategy and a strategic plan? Most people won't tell you that, right?
The other is how strategy is related to the innovation process. That's what we were talking about with Charlie Parker and sports. How is it that we can connect? strategy as a function, as a tool to how innovation really occurs. This is hard. And this is what that quote that you read, that's what I'm trying to go after, that confusion. Define strategy properly and then design a process where you can have that discipline, the discipline that's the true creative discipline.
I'll add one other thing that I think the strategy world suffers something that many other sciences, social sciences don't suffer. This is going to be a little contentious. Many of the leading people in the strategy space are also consultants. And if you want to be a consultant, it means you're running a business. And if you're running a business, you got to have your own marketing and your own brand, and you got to be unique.
Well what driver does a consultant who's making lots of money or a big consulting house, right? The McKinsey of the world who, who making a lot of money consulting and perhaps doing good for companies, right? And governments and whoever they're consulting with what energy do they have to align language with other consultants and other people and people who write books like me and who don't, I consult for nonprofits, but I don't consult for businesses right now. What energy do they have for that?
I don't think there is very much. And even the academic, even the academic community doesn't seem to be interested. And I'm not sure why. Because in every scientific endeavor in the world that is improving and getting better and learning more common language models is an essential feature of that.
i love that you said that have a practice, my discipline practice like when i give workshops are facility programs, people often comment on my god you didn't even look at any notes or you didn't look at your slides or anything like that but it goes back to the discipline i write every week to try and simplify as much as i can.
Brilliant knowledge that's behind me on the shelves here for that very reason cuz i actually want the person and this is part of my mission with the show i want to democratize brilliant knowledge that's out there when i share with people, so it takes away the fear of making decisions so people can make those decisions with knowledge and for me knowledge is almost like an antidote to fear.
if you understand it better you'll fear it less and you'll be more action orientated so i absolutely love what you say there i pulled another quote Peter i'd love you to expand upon, this one you say and this is still in the line of the challenges of strategy of the problems with strategy and this speaks more to the whole idea of emergence, you wrote that the whole idea of strategizing is still largely based on a planned and deterministic view of the world, This includes using
variations on step wise approaches like gold analyze plan scenarios implement control or plan it in detail execute, which is a huge problem for so many of the listeners of our show Peter. They struggle with this because somebody in the organization is trying to treat innovation or transformation as if it's deterministic. And is if.
It's it can be treated in the same way as a steady state program that is running inside the organization so that they have something that they know how to run, i'm trying to treat innovation in the exact same way and you say alternatively, an adaptive view of the world says that it is not a good model of change and innovation and that the unassailable logic "if you want to get somewhere you must know where you are going" misses the point.
That was such a key point that you made and i wanted to make sure we didn't miss the point.
glad you picked that quote up. I think, , the first paragraph of the book is to say, it sounds unassailable to say that if you want to get somewhere. You have to know where you're going. If you don't know you're the port that you're aiming for, any wind will do. This line has been used in different forms. For forever since the 2000 years or whatever it was that that. quote was first stated.
Yet, it's, and it sounds so right, and I think it's so wrong, because if you look at history, and I'm not a scholar of all these histories, right? I, I work more from my own observations rather than, a study of everybody and then deduce a theory from that. But I think I know enough that most people didn't know where they were going.
And at DuPont, many of the greatest inventions were not planned out and seen, but actually as they were walking down the road, as I use my metaphor for as you're living and working and coming into the office and to the lab and doing what you do. They became attuned to things. This was part of DuPont's genius that made them such a great company. They would see possibilities from what they were doing. But it wasn't like, Oh yeah.
We're going to create a great Kevlar world here, where Kevlar takes over all these applications. No, it didn't happen that way. It happened in small little pieces and their first applications were wrong. They thought it would replace steel and tires. That didn't work for a lot of reasons. And so they ended up finding other applications that they had never thought of at all. And there's many stories in DuPont.
where they didn't know what was coming, but by a disciplined way of working and observing and thinking and be attuned to things, they found the future. And , the reality of innovation and creativity. So I'd like to pick up on something you said around what happens when the leadership of an organization says, will that be profitable? And I think the failure of that is that nobody knows. Nobody can know, and that it's not the right question.
The right question is, what's the next experiment we have to run? What's the next piece of research we have to do? What's the next thing we need to do? to get a little more knowledge to allow us to judge whether we should continue on this thing. I sometimes talk about it as, a card playing analogy. What's the cost? How much do you have to bet to draw one more card? Right? You're playing poker. Texas Hold'em is this famous poker now, everybody sees it on television, right? You're always judging.
Should I stay in the game? What's the cost of one more card to see if I should keep going? And that mentality is so different than, is this profitable? Will this work? I never forget a meeting with a guy, A fellow I was working with in in my early days in the titanium dioxide business, Gary Whiting, great engineer. He he had come up with an idea for a new way to process, titanium dioxide ore. And the first thing out of leadership's mouth was, will it work? Well, freak, if we knew that!
What the hell? Come on. And it, it really didn't help, right? It, it should have been for this amount of money. Can we do the next step and tell me the conditions under which this would need to be used and so forth and that kind of thing.
Even worse peter is i've been there and we had a very toxic cfo and he, they'll gaslight you, Like they'll make you doubt yourself and they'll make you feel, oh, well, maybe you're thinking crazy. And in that moment, they actually destroy multiple other ideas that you could possibly come with, but then everybody else that was listening to that goes, it's not worth coming up with ideas in this place. It's worth executing, not. Exploring that that's surely something that you saw in your time
Absolutely. It's a great example of this. I've such a famous example is Xerox PARC, who everybody knows. And I guess it was the sixties and seventies invented the modern computer, personal computer revolution. Right. And they also invented the laser printer and guess what they did. Guess what the leadership of Xerox did with the laser printer. They said. Well, we need to sell more than four or something crazy to make this profitable.
And you've only got two customers, something, I don't know if I got it exactly right, but it was that crazy. Right? And it was an accountant and leadership listened to this and they ended up not commercializing the laser printer. We hear about the mouse and the screens and the laptops and all this stuff. They did the laser printer too. And that was exactly what the leadership said. You'll have to sell this many to be profitable.
same happen in kodak man what we interviewed steve sasson the creator of the digital camera same thing happened there like the idea was killed for this very reason, i get it i mean i get it to an extent but it's like the problem systemic. In that the board it's wall street demanding profits.
So any deviation from the share price , they might perceive that it happens down with people coming up with crazy ideas and going off track or deviance because they've deviated from, from the path in doing that. They're actually killing their futures. That's the, that's the thing that so many organizations do.
don't care about my blog this week i wrote about this opera mall deluge which is the french term after me the flood doesn't matter after my leadership term cuz it's so short anyway maybe have some thoughts on that.
Well, my first thought is that We also have to recognize that getting all seduced by new ideas is just as bad. And DuPont in its later years did get seduced by some ideas and didn't reality test them and take an approach where they learned more than they supported. Not all ideas are good ideas. It's, how you do them. But it's the skill to know the difference and the culture to have the right level of excitement and fear at the same time in every endeavor.
So that we're constantly asking , what do we need to know here? How to make this thing a success, so I think, We can be seduced by the other side too, that every idea is great. And we'll just let it happen because that doesn't work either. There's no discipline to that either.
And this comes back to , the importance of the discipline and , how cheaply can I extract the next card use your poker analogy as well. There's a couple of quotes I pulled on, and I thought these were just great for context. This we've already alluded to, but this expands on it. You said " the emergent approach eradicates the phrase planning under uncertainty because there is no such thing as its opposite.
Planning under certainty" i thought again there was a few lines here that i pulled out that i just thought could easily be missed but there was so much wisdom in them i'd love you to riff on that
Well, that one's really important to me. I think it connects a little bit to all the consulting marketing as well. How many articles are prefaced with. Strategy under uncertainty or planning under uncertainty as a generic concept. It doesn't mean that what they talk about then after that isn't true. It's just the illusion that somehow there's some case where you're planning under certainty. It's such an absurd notion, right?
If there could be anything under certainty, what would any of us have a job for? You would just do the future that you saw without question. Why would there, nobody would lose in the stock market, right? No business would fail. It's just an absurd notion. What isn't absurd is that there are different uncertainty levels. Two different endeavors.
So, for example, the best analogy is if you want to invest in U. S. treasuries, the uncertainty level is very low compared to investing in venture stocks, right? Or, or highly speculative companies and activities. But the payoff also is more certain to be, lower. The potential payoff is more certain to be lower with U. S. treasuries, right? So there's a risk reward profile that you can have less certainty about the future. but you have to accept that your range of potential success.
is much lower. And that is a real thing. But that's not what is being said when people say planning under uncertainty. Or the articles that come up about in our highly uncertain, our highly uncertain macroeconomic, environment. When was the macro Economic environment ever certain. This is such a backwards looking concept. It's that what we associate with certainty is success at the particular moment.
If the stock market's doing well and inflation is low and unemployment is low, you don't hear any other things about uncertain macroeconomic stuff, right? Yet, I argue, it's probably more uncertain at that moment than when things are going bad. Because when things are rough and going bad, if you regress to the mean, you're actually going to get better. What was more uncertain?
A month before the stock market crashes in, in in 1929 and Lehman Brothers and all that the 2008 Lehman Brothers crashes or the web. com the. com crash in 2000. When was things more uncertain before the crash or after the crash? I think after the crash was more certain that things would get better. Forget that. Just tell me why is it more certain because things are going well. The future is always uncertain.
Doesn't depend on the current condition and all strategy work, all leadership work in any field needs to have that reality. It,
and actually what's happened in a way is that we've had. We've got to a stage in the life cycle of humanity where things had been quite staid for a period of time for for a short enough period of time, what organizations kinda thought they had stability but as you said, that wasn't the case at all. If you if you zoom out, you got that is just a blink.
In our time on the planet and in that time, the, the change muscle atrophied , the mindset atrophied and actually that's at the heart of the problem is that , we forget that we'll only, and we'll talk about Ford, for example, only in the late 18 hundreds did so many of these industries emerge and , they literally emerged.
And I love how you talk about Ford and the emergence of Ford, for example, and layers that I'm just planting some seeds that we have to come back to later on, but I think that's the big challenge. and again, speaking to you, sharing this work, I think.
Is that the heart of trying to help people realize that you're not broken actually we just it's like shirt sleeves to shirt sleeves in three generations, were just thought bit removed from the struggle story and the struggle is actually what it was always like
it always was. And well, we shouldn't deny that some companies, some governments, some sports, players and musicians hit a success level. And may ride that for a good period. But does that mean again, that the future is certain? They might write it. How many, I'm not going to think of somebody right off hand, but how many great albums comes to my mind, Boston had one incredible, brilliant album. The rock band Boston from the mid seventies had an incredible album.
And it was truly original and it sold a zillion copies and so forth. They had a second album that added some, but you could tell things were going down. And then after that, really nothing ever really hit the big time again. They could say, well, this is going to continue on forever. And it didn't, right? Or you can get someone with incredible longevity, like some hip hop artist, Taylor Swift, or Jay Z, whatever, that goes on year after year with success.
In any case, you don't know when it's going to end. You don't know it's going to end. And to believe that it's going to continue on as it is, is folly. It's true until it isn't, right? The statistics hold until they don't. And you can't know when they are.
it's funny you said that but the greatest the greatest sports, Players i ever played with were the ones that had had some type of setback during their career maybe an injury maybe they lost a place and it was almost like, they gone into the chrysalis stage and have to rebuild and that rebuilding plus.
All the stuff that they almost lost was the actual catalyst for them to go and change and become and to jump the s curve on themselves and become even stronger in the next iteration of themselves and i think that's it, when we kind of frame things and go sometimes those setbacks are a gift.
Because they build resilience and they remind you that you know it's not all easy and nor should it should it be because the growth happens in discomfort anyway i'm laughing because i said to you that we'll need multiple episodes, we're not even past the intro just where we are and signpost book i do highly recommend read the book please read the book along with us. And we'll release it in parts as we go.
And that's one of the reasons I do this multiple parts when the author like Peter is willing to do so, but this book would need 20 parts to do it justice, just to say, but I wanted to bring it back. So many of our audience will be familiar with the idea of emerging strategy because of Mintz, Mintzberg's work. And there's a quote here that will tee you up, maybe to give a bit of context to where you're coming from.
You wrote that " "the emergent approach aligns with Mintzberg's teachings that you cannot plan the future, but it's not an alternative to what he called a deliberate approach. All strategy is deliberate because strategy is guidance that must be established before taking decisions and actions." Again, another key line that I thought we should expand upon.
Yeah, this is a real misunderstanding, I think. This idea that emergence and deliverance Did I just make up a word? I I We'll Yeah, yeah, no, I mean, don't go there. So well, maybe we'll just say emergence and. A deliberate strategy, or let's say a deliberate design, right, versus an emergent design. There's a terrible misunderstanding here. All strategy as I, as in the quote that you, you read. has to be deliberate because you're making decisions to constrain yourself in some way.
You're making certain agreements. Even if you're an individual, you're making an agreement with yourself or in a huge organization with others. With many people to adhere to something, right? To adhere to something. And the difference between deliberate and emergence is not whether you're deliberately choosing to adhere to something. It's how much constraint you're putting on what you're adhering to. That's really the difference.
And what Mintzberg would say is, ah, this company failed because they didn't realize that they had to switch to an emergent strategy, meaning in an emergent mode, which essentially meant stop taking all the constraints off what everybody can do. Open up what's possible, explore new things. Don't assume we know so much about the future.
So the difference between a deliberate In his language, deliver an emergence is really the difference in constraint, how much you put on, how much you force the organization and the thinking into a given place. So, for example, if a company believes.
That they are pretty, if they feel pretty certain about the future, more recognizing you'll never predict it for sure, but if they feel pretty good, and that the real deal is to put in all the machinery to make that future come true, then they may have a strategy framework that has very few options. We're not going to experiment. We're not going to run a bunch of pilots. We're not going to go researching new ideas. We're going to stick with this thing. That's a very valid strategy.
It's a deliberate choice to say, here's the rules and the policies we're going to follow. Contrast that with a business that's been doing well, but things are starting to change and they know they need to go in a new direction of some type, but they're not sure what that direction is. Okay. We're going to run experiments. We're going to give some people some room to try different things. We'll partner up with a few people and see where it goes.
Okay. But we're going to be very vigilant about is it really happening the way we thought we're going to watch all these things very carefully and we'll kill them as soon as we think they don't work and try some new ones. That's a very emergent kind of in the pop culture view of the word emergent. That's what, like, the emergent Mintzberg strategy would be. But is that not deliberate? That's a deliberate design.
To run experiments and pilots and try things in a small way versus the first example where we're saying, no, we're not going to try a lot of things here. We're going to go after this 1 thing. Both are extremely valid strategies. Both are deliberate. And in neither case, can you know what the outcome is going to be?
i know that we could skip that very easily but i again i just i feel there's so much thought put into the book and by the way i'm gonna link to the website as well that goes with the book because there's so many resources on that website you just sign up there and peter is very generous with giving away many of these frameworks as well and if you have the book you can link to there. i also have the audible by the way peter as well so i have.
I have a digital copy the physical copy behind me and the audible it's just the best way i learned and then having the honor of having the author on the show is just another bite at the cherry as well, what i thought we'd share a couple more concepts if that's ok the, again i'm trying to today is a primer almost trying to prime the pump. And then we'll go deeper in the next episodes as well.
One of the things you talk about in a section about unscrambling the many concepts of strategy is that the majority of what is proposed in the literature can be captured into eight concepts and each of these is analyzed in, part one of the book you talk about aspirations, long term big and important plans, frameworks and all this is important terminology to understand making choices, defined by requirements, patterns and actual outcomes and rules and policies.
Maybe you'll give us an overview of those and what you mean here
So as you mentioned in chapter one, I, basically do a critical review of the many, many statements and definitions of strategy given in many fields, military, not just business, military, government, the theory of complex adaptive systems from reference books, dictionaries and I, do recognize that you can boil down. of the 75 that I referenced, and you mentioned it, you can get the list of 75, the references for all 75 online in the supplement to the chapters.
All you do need to do is sign in with an email. No passwords or anything like that. I boil them down to about eight major categories of how strategies are defined in those many, many fields of endeavor, of definition. And some of the key ones you already mentioned. In reality, many people basically say that a strategy is an aspiration. Our strategy is to grow in Asia 5 percent faster than the competition and with 10 percent greater profitability. It literally will say that is our strategy.
And. Most often that's accompanied by a million bullet points of sub goals and little details and metrics about how that's going to happen. But all that is, is just an aspiration. And even in some very famous work, they call these strategic themes, or strategy themes, where you have the theme for marketing, and then their million bullet points, and then the theme for operation and their million, and so on and so forth. And that essentially is strategy defined as a very granular aspiration.
So that's one category. Another one is plans. We're going to, and so and so is gonna do this, and so and so is gonna do that. Basically, planning the future. A next one is, and this is a very tricky one. Porter famously wrote a paper in 1996, now it's, boy, it's almost 30 years old called, What is Strategy? And it was a wonderful paper and influential today. But what's the one thing he never did in that paper? paper was defined strategy.
And I don't think he ever defined it in any of his other writings incredible amount of writings. And, so what, how does he define strategy? He doesn't, but he does give it a characterization. He said, it must make you unique. It must, it must give coherent unification to the organization. It must tell you not what to tell you what not to do.
And of course, all these things are bedrock truths about what a strategy must do, but I'll argue, it's like saying an engine is defined in a car, in an automobile, a motor is defined as efficient, Easy to make, cost effective, works in all weather conditions. That all may be true, but it's also true of the air conditioner. It doesn't define what a strategy is functionally, and this is such a big problem for the strategy industry. Everybody using a different definition.
Then there's the Roger Martin strategy as a set of choices, specifically a set of interlinked choices. Right? Well, yes, it's true. Just like Porter's requirements are true. Metrics are a choice too. Plans are a choice. You paint the building as a choice. It doesn't make it a strategy. The strategy is the rule, the policy, the principle that makes all those choices coherent. So there are independent choices, but that's not the strategy itself.
It's the, it's the foundational principle that makes all those choices make sense together. There's other definitions. We already did one. Mintzberg's plant basically a pattern. He's looking backwards and saying which is a big part with this emergence thing saying, well, if we look backwards, they should have been more emergent. Well, of course, if you look backwards, you can see anything. So he had it as a pattern. And there's a few others where I come out and where my model comes out.
The derivation of strategy is that a strategy is a central rule that unifies and gives real time guidance for making choices and taking action as you walk down the road as an organization.
Nice nice just a few threads here and there i want to bring it back and maybe we'll start landing the ship on this one is that the importance of the constraints and, the importance of rules and you quote Rummelt " "a strategy is the central rule of a framework designed to unify all decisions and actions around, busting the bottleneck to achieving aspirations." I love that quote, but you go on to say then " "rules lead to patterns.
If followed the strategy rule works in an integrated way with the other components of the framework to drive change and innovations," and then you go on to say, "rules may sound like the opposite of what would lead to creativity and innovation. They may conjure bureaucracy. How could rigid, closed minded, constrained rules lead to innovations, diversity, growth, and newness?
Impossible we might think but quite the contrary rules are the most powerful enabler of adaptation and freedom because of their ability to provide real time guidance for decision making and action without over constraining."
There's a couple of key terms in there the real time guidance is a really important one so that idea of seeing in real time, how do i get the next card out of the other players in the opposite me i'm just to finish this before i hand this over to you because there's a lot in this about the idea of rules another great quote by Rummelt. " Like the guardrails on a highway the guiding policy directs and constrains action without fully defining its content."
And then finally you finish on this by saying, "the simplest and most elegant laws and regulations in society are those that specify what cannot be done allowing freedom for everything else." i absolutely love that an important point.
It's funny, it's the artists who more than anyone know this, right? That they must restrict their range. But great business people, great people in all fields realize that they might not say it this way, that the heart and soul of creativity is constraint. It is forcing yourself to channel into a direction that's the unknown in a sense. Whereas without constraint, everything is a good idea. When all ideas are good, no ideas are good.
And I have to pull in Charlie Parker here to remind everyone that great, legendary, innovative alto saxophone composer and composer from the forties, he had rules, he had harmonies, he had rules on how he improvised. He had a discipline to what he adhered to and that freed, freed him. But the most important thing he said was, learn your horn. Learn the changes, which meant the chord changes. Learn the music deeply, but then when you get up on the bandstand, forget it. And just wail or just play.
You have to internalize all this for it to become that guiding guardrail, that channeling that Rommel talked about. It has to be in the heart. And for an organization, it has to be in the heart. And this is the thing that's probably the missing piece. When people talk about constraints and rules being the essence of creativity, it's not on the surface. It has to be very deep and it becomes almost unconscious.
And then, like Charlie Parker said, then you get up and wail and forget it all and just let it happen. People, it's easy for people to see the wailing part. Language then, we call it blowing, right? Because of so much of jazz improvisation being on horns. Trumpet and trombone and saxophone. They see that part. Oh, look at how free he is. Wow, man, where'd that come from? Damn, I couldn't even have thought of that in a million years. But it came from something very deep down.
And those things deep down ended up being rules.
Brilliant there's a quote i have to share with you absolutely love by only matisse the french painter he said, there's nothing more difficult for a truly creative painter than the paint a rose because before he can do so he has to first forget, All the roses that were ever painted before, and it's Beautiful is perfect for what you're saying wow.
Yeah. share with you afterwards i thought it was a brilliant one i have a couple more key take away i thought we get further than we did today, what does it there's a couple of more really just key lines that i love you to share i mentioned the term bottleneck and, a key take away is that strategies must be found from the bottleneck to aspirations not, The aspirations themselves hence the focus throughout the emergent approach on the triad of aspirations,
bottleneck and strategy written as strategy- bottleneck- aspiration. Again, just giving this framework today will help us then build on it over the next two sessions.
This is a, a bedrock principle and design principle of an emergent, any emergent approach. It would have to be. And it aligns. With Rummelt, it aligns with Goldratt and the theory of constraints. And it aligns with a few other people, Saul and other people who have recognized the need to overcome the bottleneck or to address that i, I've used this term, bust the bottleneck to achieving the aspirations that you want to achieve.
And, a quick bit of theory behind it is simply, As Goldratt stated very clearly for an operational concept, originally, he didn't mean it to be restricted to that, that to change a system, and that can be a business, it could be a product, it could be a person, it could be how you play a song. Systems can be anything, you choose them artificially in a sense, right? They can be large or small. To change a system, you have to address whatever the dominant constraint to that change is.
And if the , sole purpose of a strategy is to change something, to move it from A to B, to create something new, well then you have to address the thing that's in the way of creating that new thing. It's very basic, fundamental thing, yet it is only loosely used, I think, in the strategy world. It comes in and comes out. good people's stuff, but it's not explicit as it has to be. So the triad you mentioned is, and visually it's got a little diagram which appears throughout the book.
It's from a little influence diagram that if you have an aspiration and you may not even be sure about your aspiration, but you, you think you have a future state you want to get to. If you work backwards from that as a mental exercise. You come out with it, you have myriad choices and actions you have to take now and in the future to have that aspiration come true.
What I argue in, in the first several chapters of the book is that a strategy is for giving real time guidance that unifies all of those decisions and actions now and in the future, so that they're coherent towards, reaching the aspiration, but you don't design it directly from the aspiration. You design it for busting the bottleneck because that's the magic road to getting to the aspiration. So this is where we get what you were talking about, the triad of aspiration, bottleneck, strategy.
And I found that You can make enormous progress in working together on how to make change and innovate just with those three things up on one page and talk with the group and explore different combinations of those things and find out what's really going on. Rumlet uses this term all the time. What's going on here? What's really in the way? And what do we have to do to change what's in the way? So that's what that triad is.
That you've you asked me to describe and it's core, absolutely core to the book and to the theory of the strategy.
It's brilliant. So it's an important thing. And I don't know if astro teller, who's the, he calls himself the captain of the X, the moon shot factory. He has great term tackle the monkey first, which is don't waste all your resources on the easy stuff.
I definitely Culpa have absolutely done this as a head of innovation because if you're in the wrong organization and if your organization understands innovation in the wrong sense, You will be trying to prove yourself and you'll prove yourself on , the easy stuff, the low hanging fruit, which is a good idea once you have your foot in the door, but when it comes to a big hairy audacious goal that you're trying to, or some real, when you're doing real innovation, not innovation theater,
you have to do what you're saying. You have to deal with that bottleneck. You have to. Identify you have to know it's coming and this goes for all the people who listen to this show all those people who are working in innovation, if you're on a big meaningful project, you have to seek out the bottleneck and deal with it because it's gonna come back and bite ye in the ass later on that is absolutely for sure
This idea is embedded in our, our common wisdom. How many times have we heard the statement a problem well defined is half solved? That's the magic of focusing on the bottleneck. We should add, just for introduction, that don't get hung up on that term alone. Obstruction, barrier, limitation.
Whatever you want to, however you want to conceive of what is that thing that's limiting your progress, whatever that term is I chose bottleneck because I like the image that is, is a progress, ongoing progress question and can you reduce the constriction of that flow, whereas obstruction makes it sound like once you're over the hump, you're, you're solved, or once you're over the wall, you're done. But I want to, I want to bring it back to that problem well defined is a problem nearly solved.
And that might be a little bit of folk wisdom. And important people have said it, but it's not just folk wisdom. It's, it's really, really important. And I think this, I don't think this is well enough grasped in this strategy industry about how much noise focusing on the bottleneck eliminates, because when you write down bullet points of a bunch of actions and choices and sub goals and metrics, what ends up happening is that they're all good ideas.
but they're also all bad ideas just by the fact that we've written so many down and there's no, there is, everybody wants focus, right? They talk about strategies, all about focus. Well, goals don't give you that focus. They only give you a little bit. The bottleneck brings in the rest of the focus. So I, I do believe that my emphasis on it and a few others, but I think I'm doing it more than anyone. It's, it's really key to success. Large and small organizations, large and big endeavors.
It doesn't matter.
It's probably even more important for a startup founder or somebody like that who's gonna run out of runway cuz they literally are gonna burn all the runway on the easy stuff and then. It's like they're gonna get to the you know end up with a chocolate tea pot and nobody wants it and they're gonna go oh how did that happen you're going
How'd that happen? But I, I think this is what great entrepreneurs do naturally. And they're doing it so quickly and they're doing it alone or managing a group of people that we don't see it, that they're constantly busting barriers as they come up against them. And they constantly work around those with some discipline around maintaining a view of what. The bigger picture has to be.
And I always thought a little bit of a description of my work was to how can we capture that in a big organization? where people are spread around geographically and culturally and with different functions. How can we capture that? that's what this bottleneck factors is helping do.
As a final piece maybe because you said it there. The fact that there's so much neurodiversity across an organization, people seeing the same thing from different areas. I think about you, your career in DuPont , for example, , , you were a walking one man version of the axiom. That innovation happens at the intersections because you've had so many different roles with inside the organization.
So you, you had literally got dragonfly eyes, you could see from all these multiple perspectives, but it, but it leads me to one last key point that we'll make today. And that is that "other people's strategy rules may not sound as momentous or deep as the aspirations they are designed to achieve without understanding an individual's or a group's reality.
And that is that other people's strategy rules may not sound as momentous or deep as the aspirations they are designed to achieve without understanding an individual's or a group's reality. Without walking in their shoes and knowing their bottlenecks, their strategy may sound downright trivial. And this is important both for you as an organization, you as a consultant, many consultants listen to this show is that sometimes.
You like it's very difficult as a consultant to get inside the minds of people who actually really truly understand through the scar tissue of their organization, what's going on and what will be the bottlenecks cause you don't see them from the outside cause you may have worked in a different place and it's it's like i often think about this it's it's like every organizations like a snowflake.
There's stuff going on in there that is so unique to that organization that you can't have a one fit size fits all strategy.
You're hitting on a powerful question around consulting and helping other people find their own reality. It's so true the way you described it. If you come up with a generic concept, or maybe even more. Dangerous. The vast majority of writing on strategy uses examples of great successes. And, well, do like, do like Bezos or do like Musk and you'll have 80 billion, or I'm, I'm underestimating now, right? You'll have 200 billion.
And I know that there's a lot to learn from these great people, but, you gotta discover your own reality, right? You have to discover your own abilities and your own fight and your own failures and live through your failures. And you talked about my career. I had many more failures than successes. And I'm very sad about many of them and tried to my ways here by helping other people avoid them.
They,
uh,
the best consultants, the ones that both have the humility to admit that, but also you learn more from the failures.
there's no question and people know that that's true, but I just wanted to, I wanted to just reinforce What you're saying there? I believe it's very true that seductive strategies that are talked about in books and stories and books and from consultants and so forth, the real ones may not sound so great. They may not be as exciting, and I think that's one difficulty in writing a truly fundamental strategy book.
You don't create a bunch of beautiful exemplars to excite everybody by and say, do like this because they're not you. And, an example I give often would be, well, it sounds really simple. Our product line's gotten really complicated. Some of it's not profitable, so we're going to cut the tail. You hear that all the time, right? We're going to cut the tail and I can we could have a 10 hour session on how badly done that is. So they'll come up and say, okay, this customer, we got to let them go.
And what if that customer was a customer that got you there? What if that customer created the careers of a whole group of people? What if that customer will bad mouth you and that's something to consider, but even the purely emotional things, what if that customer got you there? What if that customer is the relationship with 10 people that made a whole career out of it and made the company? You don't think about that when you hear, well, we went into this company and we said, cut the tail.
And we got rid of these customers. It's, it's not the same if it's not your bottlenecks, your realities, your world. And I think some, if any of some of the key things that I wish people would take away from my work is to learn your own reality. To suffer through learning your own reality versus applying models from the outside immediately. Don't start with them start with your own learning and suffering, then go out and get other stuff.
Beautiful man absolutely we gotta leave it on that because that's just an absolute legendary way to leave it and on a personal level as well not just as a consultant for other people like you do you every else is taken. Again, Peter, let's, let's share where people can find you and, and your website. Maybe you'll share that with our audience
Sure. Of course the book is available on amazon. com. You can, the audio book, it came out recently. We got the paperback, got the hardcover. Then you can find me on LinkedIn. And I do post quite a bit. And so you can get a flavor for some of the key points and some dialogue with others on LinkedIn. That's very easy to get to. And the last thing I'll mention is, EmergentApproach. com. Just the title EmergentApproach. com. And as Aidan, said, there's quite a bit of chapter supplements.
and even five task sets that you can use as a little bit of a guidebook to to implement the principles of the emergence approach, along with some templates and additional examples and things like that. , Aidan McCullen: and man, you sent me down so many rabbit holes. I have enough books to get through on my shelves here, but I bought so many more because of you as well, and I've booked some of the people that you've mentioned on that I hadn't heard of, which is great.
And, book them onto the show in the future as well, which is just adding to that list, but it's emerging I'll throw it I throw it out there. You can also go to Peter Campo Music on YouTube if you'd like to see some of my music.
brilliant. Absolutely, man, I'll link to those as well for SEO purposes as well, Peter. and we'll be back, man. I absolutely loved today. Author of the emergent approach to strategy, Peter Campo. Thank you for joining us.
Thank you.