The most ambitious financial planning firms I’ve worked with have been keen to develop a robust framework around a simple strategic approach, for predictable and repeatable future success.
For those of you who have adopted the “cascading choices” framework for strategy, used for decades by Roger Martin, and written about prominently in the 2013 book he wrote, with friend and colleague A.G. Lafley, called Playing To Win, the following will come as no surprise:
A winning strategy requires making explicit choices – to do some things and not others – and building your firm around those choices.
Of the five interrelated choices in question (a Winning Aspiration; Where to Play; How to Win; Capabilities required; and Management Systems needed) the heart of strategy resides in your ‘Where to Play’ and ‘How to Win’ choices.
Where Will You Play?
These need to be the segments or arenas where you can achieve your winning aspiration. It’s where you will compete, and know you can win, taking into account geographies, advice segments, target markets, demographics, etc.
Often, some of your most compelling and liberating Where to Play choices will be where you explicitly choose not to play.
How Will You Win?
This is the way you will win in the chosen segments or arenas. And not just how you will win generally but how you will win specifically in each of your Where to Play choices. Identify your unique right to win – your value proposition and your competitive advantage – to make you distinctive when compared to your competitors.
Interestingly, when helping businesses facilitate the Playing To Win methodology, I see practice owners and leaders get stuck after making their Where to Play choices. Why? It’s because they’ve considered their Where to Play without referencing How to Win.
As described by Roger Martin in a recent Harvard Business Review piece, the challenge here is that both are linked, and together they are the heart of strategy; without a great Where to Play and How to Win combination, you can’t possibly have a worthwhile strategy. Of course, Where to Play and How to Win have to link with and reinforce an inspiring Winning Aspiration.
And Capabilities and Management Systems act as a reality check on the Where to Play and How to Win choices. If you can’t identify a set of Capabilities and Management Systems that you currently have, or can reasonably build, to make the Where to Play and How to Win choices come to fruition, it is a fantasy, not a strategy.
Locking and loading on Where to Play choices, rather than setting the table for a great discussion of How to Win, actually makes it virtually impossible to have a productive consideration of How to Win. That is because no meaningful Where to Play choice exists outside the context of a particular How to Win plan.
There aren’t inherently strong and weak Where to Play choices. They are only strong or weak in the context of a particular How to Win choice. Therefore, making lists of Where to Play choices before considering How to Win choices has zero value in strategy.
The only productive, intelligent way to generate possibilities for strategy choice is to consider matched pairs of Where to Play and How to Win choices. Generate a variety of pairs and then ask about each:
- Can it be linked to an inspiring, attractive Winning Aspiration?
- Do we currently have, or can we reasonably build, the capabilities that would be necessary to win where we would play?
- Can we create the Management Systems that would need to be in place to support the building and maintenance of the necessary capabilities?
Those Where to Play and How to Win possibilities for which these questions can plausibly be answered in the affirmative should be taken forward for more consideration and exploration.
It doesn’t matter whether the strategic question is to aim broadly or narrowly, or to pursue low costs or differentiation. What does matter is that the answers are a perfectly matched pair.
Steve Browning is the founder and managing director of The Strategy Institute, and works with ambitious business leaders who want to think through, choose and do the things that matter most for a wildly successful future.
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