91: How to sharpen up your vision and strategy

I’m writing about 100 things I’ve learned the hard way about product management. You can catch up on the previous entries if you like.

You can help your company to sharpen up its vision and strategy with these straightforward questions and worked examples.

In this article

• Introduction
• A few disclaimers
• Does everyone see the same vision and strategy?
• Your degree of influence
• Sharpening the vision
  • IKEA’s vision statement
  • X’s vision statement
• What are we currently doing?
• Honing the strategy
• Targets alone do not a strategy make
• Actual strategy is hard
• A little help, please
• Defining a good strategy
  • Diagnosis questions
  • Guiding policy questions
  • Coherent action questions
• IKEA’s COVID strategy
  • Diagnosis
  • Guiding policy
  • Coherent actions
• Re-vision
• Final thoughts

Introduction

Whether you’re joining an organisation as a relatively junior product manager or as a member of the senior management team, a good starting point for orienting yourself is the corporate vision and strategy. They set the context and direction you need for the product strategy and tactics.

When the vision and strategy are focused and clear, they allow product managers to prioritise and filter the possible options for their products more easily by assessing how well each option aligns with the broader strategy.

When they’re less coherent, product managers will still strive to make the best possible decisions, but the resulting actions will not be as coordinated, losing the multiplicative advantage that coordinated actions bring.

A few disclaimers

I’m not for a moment claiming I’ve invented some magic new framework (that would be terribly out of character for me). I’m humbly standing on the shoulders of giants, Richard Rumelt (Good Strategy, Bad Strategy) and Geoffrey A. Moore (Crossing The Chasm) in particular, as well as several others for the approaches outlined in this article.

Also, this is not the only way to examine your vision and strategy — you can and should use other methods also to assess them from different perspectives.

The prompts I suggest you ask later are not going to list out for you the exact set of moves you need to make to win the market with your products. You’re still going to have to go out and do the hard user research to turn your guesses and assumptions into evidence and facts.

However, the questions I suggest below will dovetail nicely into whatever other methods you are using to figure your overarching strategy. Then you can dive into the detail of making bets on how you’re actually going to achieve it.

Does everyone see the same vision and strategy?

Different organisations will have better and worse starting points when it comes to vision and strategy. As part of your company induction, you’ll hopefully have the chance to meet with various members of your senior management team, department heads and other.

As my friend Helen Holmes always reminds me:

“The state of being new is this absolutely incredible gift, especially to a product manager, because you can reach out to anybody and just say, I’m new, please help me.”

Helen Holmes, author and freelance product director

Ask them to describe the vision and corporate strategy to you from their perspective, and how their department or team typically works. If you need to, clarify whether they’re describing the company’s vision and strategy, or those of their own department or team.

While I can’t simply ask these questions directly, these are what I’m really trying to find out the answers to:

What are the organisation’s vision and overall strategy?

How well aligned is the senior management team on these? (understanding and action)

How focused are the organisations’s goals on outputs (revenue, margin, market share etc.) rather than user outcomes?

What targets and incentives are teams and departments using to track their performance?

How well understood are the organisation’s vision and strategy by the product team?

How is my product (or product line, or portfolio) helping to move the organisation closer to its vision?

I think of it like a discovery exercise, because I don’t yet know what I don’t know. Through these conversations, I’m trying to piece together a picture of how well defined the corporate vision and strategy are, and how the well aligned the organisation is to them through the activities they’re engaged in.

I reserve judgement because I’m still figuring out the context. However weird or dysfunctional things may appear on first blush, I always remind myself that the organisation is nevertheless conducting business sufficiently well to keep the lights on.

What I typically end up is a shortlist of things centred around product management and the product team that stood out for one reason or another, with open questions to find out why they’re happening that way.

Next I review how well the various descriptions of the company vision and strategy I’ve been hearing match up with each other. If they’re all pretty well aligned, that’s an encouraging start.

I’ve written before about the problems that can arise from an absent or poorly aligned vision and strategy.

Your degree of influence

Even if you found yourself in a fairly senior position in the organisation, chances are you wouldn’t simply be able to dictate a clearer vision and corporate strategy. Instead, you could focus on what is more in your sphere of control (your own product strategy), and hopefully set a good enough example to influence the wider corporate strategy.

I’ve seen examples of this approach working in the past. Years ago, a former colleague introduced software-as-a-service (SaaS) products to the company we were both working at, creating a multi-million revenue stream, and shifting corporate strategy as a result. But it took him several dedicated years and was very much a hard-won victory.

Another approach is to give the senior management team a method for examining the existing vision and strategy that will highlight any vagueness or incoherence. That way, it’s not you having to convince them, rather they’re able to draw the same conclusions for themselves. (Whether that changes their approach is an entirely different matter.)

When I do this, I like to frame this activity as a set of questions for them to ask. They’re based on helpful methods other writers and product people have shared.

Sharpening the vision

The corporate vision can sometimes be a little fluffy and vague. To avoid triggering defensive reactions, you may need to distinguish between the vision statement you’re seeking and the snappy soundbite that may feature prominently on the office walls, corporate website and marketing materials (and which would cost $$$ to change).

Ideally, the vision we’re looking for should succinctly describe the far-off, hard-to-achieve change in the world we want for our users. These questions help to expose potential fluffiness:

Who is the vision framed to benefit? The users or the business?

Does the vision describe what the organisation is already doing? (not far-off or hard enough)

Does the vision describe something we want to achieve that is currently considered impractical or not easily attainable?

How specific is the vision? Would a more general goal make it harder and further off? Would a more specific goal reduce distractions and provide focus?

What would be a ridiculous extreme for the current vision? Why shouldn’t that be the vision?

IKEA’s vision statement

IKEA’s vision is:

To offer a wide range of well-designed, functional home furnishing products at prices so low, that as many people as possible will be able to afford them

Source: IKEA

IKEA’s vision statement focuses on benefiting users (affordability). While it does describe what it’s currently doing, the goal (as many people as possible) is still off in the distance. We may take it for granted given IKEA’s pervasiveness, but few competitors are able to do what IKEA does, with the same consistency and scale.

The vision relates to a broad enough category (home furnishings) that there’s plenty of room for different coordinated approaches, without being overly general.

X’s vision statement

Now let’s look at the vision statement for X, the social media site formerly known as Twitter:

X is the future state of unlimited interactivity — centred in audio, video, messaging, payments/banking — creating a global marketplace for ideas, goods, services, and opportunities. Powered by AI, X will connect us all in ways we’re just beginning to imagine.

Source: Linda Yaccarino on Twitter, uhhh, X

X’s vision is not explicitly framed around user needs. Instead it talks about solutions aimed at the user for their unspecified needs. It’s not clear what problem X is solving for people. It describes partly what the business is already doing, and some things that it’s not yet.

What Yaccarino is describing is complex, but is arguably something that other companies have already achieved — see Tencent and WeChat for details. As such, the goal of the vision appears to be to create a ‘me-too’ super-app, very much an output (the stuff the business builds or attains) rather than an outcome benefiting users. The ‘why’ is missing.

What are we currently doing?

Next we move one layer down in detail and describe in general terms how the organisation is operating right now. We want a description that reflects current reality rather the aspirations. Geoffrey A. Moore suggests a structure for a product’s elevator pitch in his book Crossing the Chasm. With a little adaptation, we can also use it to describe what the organisation does (or at least one of its main business units):

For <target customer>

who <target statement of need or opportunity>,

we offer (a range of) <main product categories>

that <key user benefits / reasons to buy>.

Unlike <primary competitive alternative>,

our products <statement of differentiation>.

Source: Crossing the Chasm, Geoffrey A. Moore (with adaptions)

Once we’ve formulated that description of what the organisation is currently doing, we can ask:

How well does it align with the vision?

If we kept doing things as we are currently, would we be happy with the pace of progress towards achieving the vision?

If we know, what would we need to do differently to get towards the vision more quickly? (stop, start, do more of, do less of)

Let’s create one for IKEA:

For home owners and renters

who need to furnish their home, often for the first time

IKEA offers a range of home furnishing products and homewares

that is well-designed, functional and affordable, and promotes sustainability.

Unlike other home furnishings retailers

our products keep costs low by being sold direct to customers, flat-packed, from large retail warehouses, without compromising on quality. We reinvest part of our net income to keep low-price product ranges as affordable as possible. We operate a franchise model to ensure brand consistency and quality while increasing our international reach.

Is what IKEA is doing aligned well with its vision? Yes!

Honing the strategy

So far we’ve established and sharpened up the vision, which gives us the end goal and the compelling reasons for wanting to get there. We’re not quite done with the vision, because we’ll need to revisit it later on. We’ve also looked at what we’re currently doing, and how well that’s moving us in the right direction.

Next we’re going to look at the strategy. Strategy describes the moves we’re going to make to help us achieve our vision more effectively. If you think of your vision like a holiday destination, your strategy would determine the choices and trade-offs you’re going to make when deciding how to get there.

I might wish to choose comfort over saving money, or scenic routes over getting to the destination quicker, or to take the ferry because I want to avoid disruption at airports. I still want to end up at my destination, but my travel strategy should reflect how I’m going to do so, and the reasons why I’ve decided to do it that way.

Targets alone do not a strategy make

Now by contrast, what would happen if my travel ‘strategy’ was just a list of things I want to check off a list? I might want to visit certain places of interest along the way, or even to ensure I’m averaging a particular speed throughout the journey to get there on time.

While these may suggest some strategic choices, by themselves they don’t really tell me how I’m going to reach my destination and why I’ve decided to get there that way.

This is precisely the problem with having solely a bunch of targets and calling them a ‘strategy’. They describe specific things we might want do on the journey, but we still need a coherent strategy to contextualise whether we should be doing them in the first place (the ‘why’), and if so, how to string them all together on the way to achieving the vision (the ‘how’).

To be clear, I’m not saying that having targets is bad. Rather I’m suggesting that we first need to figure out the why and how of the strategy, then we can then identify the checkpoints that will indicate if we’re moving in the right direction and at the right speed.

This sets the stage for defining your leading metrics later on, a topic I’ve covered before in editions of PRODUCTHEAD before (“The joy of metrics” and “John Cutler’s North Star Metric”).

Actual strategy is hard

The thing is, of course it’s pretty easy to define my travel strategy. Most of us make travel plans fairly often, and the trade-offs between the options are common knowledge. Creating a strategy for a business is clearly much more complex.

When we set off on vacation, it’s not as if we first have to chart a new map and invent a novel mode of transport to get us there. In the modern world of travel, everything is so much more certain.

In contrast, figuring our the strategy for your organisation, or even just a single product, means having to cope with lots of uncertainty. It’s not a case of choosing a strategy from a set of well-known options — we might first have to discover what those options are, and occasionally invent a few new ones for ourselves.

Even if we do have a sense of the options available to us, we don’t necessarily know what trade-offs we need to make by choosing one over another. That’s why strategy is hard.

A little help, please

Thankfully we have many useful ways to frame our thinking. In particular I like Simon Wardley’s mapping technique, which is powerful for understanding the strategic landscape and gameplay, but has a steeper learning curve than other methods if you want to derive the most benefit.

Fareed Mosavat and Casey Winters from Reforge have written about the broad categories of strategic play, and Gibson Biddle’s DHM model (Delightful, Hard to copy, Margin-enhancing) may also provide food for thought.

Lucy Spence has an excellent article which builds upon Hamilton Helmer’s 7 Powers to help you figure out how to establish a defensible, hard-to-copy advantage over competitors. (With dragons!) She suggests thinking about how for each ‘power’ the organisation could defend itself from threats, expand into new markets, or innovate.

I also like John Cutler’s North Star playbook and Martin Eriksson’s Decision Stack, which both help especially with coherence and alignment between high-level goals all the way through to day-to-day actions.

But for focusing in on the strategy itself in this article, I’m relying on Richard Rumelt’s approach as described in his book, Good Strategy, Bad Strategy.

Defining a good strategy

Rumelt writes that bad strategy is characterised in four ways:

Fluff. Fluff is a form of gibberish masquerading as strategic concepts or arguments.

Failure to face the challenge. Bad strategy fails to recognise or define the challenge. When you cannot define the challenge, you cannot evaluate a strategy or improve it.

Mistaking goals for strategy. Many bad strategies are just statements of desire rather than plans for overcoming obstacles.

Bad strategic objectives. A strategic objective is set by a leader as a means to an end. Strategic objectives are “bad” when they fail to address critical issues or when they are impracticable.

Good Strategy, Bad Strategy by Richard Rumelt

He later describes the kernel of a good strategy as containing three elements:

A diagnosis that defines or explains the nature of the challenge. A good diagnosis simplifies the often overwhelming complexity of reality by identifying certain aspects of the situation as critical.

A guiding policy for dealing with the challenge. This is an overall approach chosen to cope with or overcome the obstacles identified in the diagnosis.

A set of coherent actions that are designed to carry out the guiding policy. These are steps that are coordinated with one another to work together in accomplishing the guiding policy.

Good Strategy, Bad Strategy by Richard Rumelt

So the questions we need at this stage are easy to ask, but more difficult to answer:

Diagnosis questions

What’s going on?

What are the problems and challenges facing our target customers? How do we know?

What are the problems and challenges facing our organisation? How do we know?

For each set, which are critical (tangible threat to our business) and non-critical?

Guiding policy questions

What broadly are we going to do about it?

For each critical problem, what general approach would align with our vision?

What other things could we try?

Coherent action questions

What will we actually do?

For each of our guiding policies, what are we going to do and not do?

IKEA’s COVID strategy

Let’s look at IKEA again, some of the challenges it faced in the last few years, and how it responded.

Diagnosis

COVID is forcing much of our customer base to spend more time at home: working, exercising, homeschooling, as well as needing to disconnect sometimes. Our customers need to adapt their homes for these different purposes.

Mandated store closures, stay-at-home orders and health factors because of COVID are putting the livelihoods of our 166K+ staff and franchisees at risk

COVID and other factors are contributing to global rises in supply chain costs

Guiding policy

Rework our product lines in response to our customers’ change in needs.

Enable e-commerce as primary retail method

Find ways to keep our retail stores open in some capacity to allow us to keep operating

Support our staff’s livelihoods by finding safe ways to keep them working, avoiding furlough or redundancies

Avoid making life harder for our customers by passing on increases in supply chain costs via price rises

Coherent actions

Let’s rework our existing product lines and introduce new ones to facilitate our customers’ emphasis on different activities: socialising and personal space, hygiene and bringing outdoor space to the home in some form.

Partly to permit continued retail operations and partly to allow many of our staff to continue working safely despite the pandemic, let’s convert as many stores as we can into ‘click-and-collect’ e-commerce fulfilment centres. (A good example of a force multiplier.)

Let’s establish neighbourhood pick-up points to allow customers to collect purchased items without having to visit a store.

Where stores need to close because of government mandate, let’s waive rent and service charges for our franchisees to help them also weather the pandemic.

Let’s absorb the supply chain cost increases so that we don’t have to raise prices for our customers.

IKEA did all these things in response to the pandemic, including absorbing EUR €250 million supply chain cost increases in financial year 2021 without raising prices for its customers.

Sources:

“IKEA talks opportunities and challenges of retailing in 2022”, Insight DIY, 31 December 2021 (retrieved 25 July 2023)

“IKEA grants €26m to protect the health and livelihoods of communities, co-workers, suppliers and consumers impacted by coronavirus”, Ingka Group, 27 March 2020 (retrieved 25 July 2023)

IKEA’s “Life at home” report 2020 (PDF)

IKEA’s “Life at home” report 2021

Re-vision

For our diagnosis we identified the biggest problems and challenges facing our target customers, and hopefully did some research to figure out whether they were as critical as we thought. For our guiding policy we also thought about the broad moves we needed to make in response.

Before diving into any more detail, now is a good time to reflect back on the vision we sharpened up earlier.

This brings us to one of the biggest questions we need to ask: does what we’ve figured out so far suggest that we should be aiming to get to a different destination? In other words, do our diagnosis and guiding policy suggest we change our vision for the organisation?

We should not take this question lightly because it’s a doozy — it fundamentally changes where we want to get to and why. Lots of people in the organisation may be invested in achieving the current vision, and a dramatic change could alienate them.

Likewise the knock-on effects potentially mean changing up a lot of what the organisation is currently doing. This kind of change is going to be costly in various ways, and productivity is going to tank while the organisation reorients itself. All good reasons why the vision shouldn’t change that often.

But we still have to ask the question.

In our IKEA example, its strategy and vision were already well aligned, so there was no reason to change the vision. And when COVID forced a dramatic strategic detour, that alignment made it easier to determine the right guiding policies and subsequent actions.

Final thoughts

It’s not easy to sharpen up your vision and strategy. You have the challenge of wading through the assumptions, opinions and received wisdom to uncover hard evidence through research. It’s also easy for people to be reluctant to change something into which they’ve already invested time and effort.

By asking these questions, the hope is that your senior management team will come to realise when they need to improve the vision and strategy. And when they they do, they’ll have a structure to help them.