If you are actively involved in strategy, you most likely would have heard of Richard Rumelt’s book, Good strategy. Bad strategy. He provides some interesting indicators, insights and anecdotes as to what makes up a good or bad strategy. He argues that Bad Strategy is prevalent and despite many subsequent discussions, managers are still not sufficiently paying attention.
So, I made up a table of my own Smart / Stupid Strategy indicators for us to use. These lists are partly inspired by Rumelt and are certainly not definitive. Nor are these lists useful without reviewing them within practical examples. Four examples follow below this table.
Please use this table as a checklist to identify, Smart or Stupid aspects to the examples below. There are no right of right answers, just our opinions.
1. Mark Zuckerberg (Entrepreneur)
Strategic Issue: The Cambridge Analytica scandal rocks Facebook’s reputation and the data breaches prejudice its customers.
Strategy Selected: Humility in apology for mistakes, with promises of improvement. Appear before some, but not all inquiries worldwide. Avoid sharing technical information.
Stupid: B#3; B#6; B#7& B#15, because evidence suggests that no apology or serious discussion regards the issue of how customers were prejudiced by the scandal has taken place. Seemingly, post scandal PR has been focused on damage control and Facebook’s reputation management. Suspicions have been heightened regards Facebook’s business model, particularly regards how it will earn its income without a similar data breach not happening again.
There is also speculation that Facebook could be a platform for politically manipulating election results. To date, Zuckerberg has yet to provide assurances that this won’t and cannot happen. If nothing is done and people are not brought to account, then nothing will change. This will be worse for all, including Facebook.
2. Donald Trump (Businessman / Politician)
Strategic Issue: Trump is allegedly being accused without prejudice, of dealmaking unethically and influencing the 2016 US election results.
Strategy Selected: Increasingly hiring lawyers to aggressively defend his reputation and relentlessly using Twitter for this purpose.
Stupid: B#7; B#10; B#16; B#20; B#2; B#5; B#8; B#13, because evidence suggests that his mixed media messages are in conflict between his spokespeople. Seemingly, statements have to be regularly revised and retracted to get a coherent story. Since the Russians are accused of waging a cyber war with the USA and with Trump failing to take post election action, the Republican Party wins without scrutiny.
Also, a number of women have filed lawsuits after being allegedly being ‘coerced’ into signing a non-disclosure agreement and paid a financial settlement to prevent them from selling their stories to the press. Trump is unsuccessfully using presidential privilege and immunity arguments in court in an attempt to quash critics and whistleblowers.
Pundits are worried that diversion tactics may be used to create news elsewhere, to take away from the personal aspects of Trump’s character and tactics. Not only could this cause doubt about his suitability as president, but controversies in foreign policy are a powerful means to distraction from the truth. New media allegations appear that Michael Cohen, a Trump legal fixer, received a secret payment to fix talks between the Ukrainian president and President Trump. It goes without saying that US Presidents require strategies and behaviour that inspire public confidence in rational and ethical leadership.
3. Elon Musk (Entrepreneur)
Strategic Issue: Pressure from regulators, shareholders and consumers. Challenges include Model 3 production targets and rumours of financial difficulty.
Strategy Selected: Company reorganisation. Flatten management structure and hire production staff to the payroll.
Smart: A#4; A#8 & B#6 (inverted), because evidence suggests production increases and cost reductions are the greatest priorities to appease Tesla’s investors dividend fears. Especially since Tesla needs to raise billions in working capital to keep going in the short term.
4. Abe DeVilliers (International cricketer)
Strategic Issue: Physically and mentally tired and can no longer give 100% to international cricket.
Strategy Selected: Retire from international cricket, aged 34.
Smart: A#4 & A#8, because evidence suggests he is increasingly popular, he is still playing well and his legacy, will likely be of him being remembered for his spectacular performances. (averaging more than 50 per innings) This helps his brand and marketing platform for future promotions.
Retirement frees him to spend time with his family and his other interests, while playing only white ball cricket. He is maximising his resources available to deliver in the next phase of his life. He exits while still popular and successful. He also avoids the onerous political aspects of captaining a national team.
I encourage you to criticise constructively and challenge my assessment of what are Smart or Stupid Strategies for the four examples above. I want you to fill in the gaps in my arguments and conclusions. Please, share your opinions insights and information for the benefit of all.
Feel free to use the inverse of items in either list. For example, B#6 says: Failure to make decisions. This could be inverted to mean a characteristic of a Smart strategy, that of: Making good decisions.
Are you able to suggest and substantiate a few Smart and a few Stupid Strategies that you have come across? Please share them with us, in the comments section below. Start discussion threads of different opinions on the topic, which would be helpful and interesting.