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January 2005
How to Think Like a Strategy Consultant: A Primer for General Managers
By Robbie Baxter, Principal, Peninsula Strategies
It’s funny how a change in roles can shift your perspective. After spending years in corporate management, I switched
to the other side. Now I make a living as a strategy consultant, advising companies on how to assess market opportunities.
And it has become startlingly clear to me that general managers (GMs) can increase their effectiveness by thinking a
little more like an outsider—not only when companies are developing new strategies, but every day.
Following is a list of traits that highly effective and objective managers possess, all of them areas I wish I’d
focused on more when I was an executive. As a GM, you may have already implemented some of them, but they’re all worth
revisiting and putting to use in your organization.
Delegate, Delegate, Delegate
If you find yourself doing "low-value" tasks because no one else knows the details well enough, and, as a result,
you are delegating the high-level stuff, fix it—immediately! Recently, I talked with an executive (responsible
for a large organization) who manages her own calendar because she hasn’t found time to hire an administrative assistant
for over a year. What a waste of her expertise and influence—spending hours each week coordinating her schedule.
The danger of becoming mired in little details is that we lose sight of the big picture that’s core to successful
strategizing. Sometimes, companies hire me to develop their core strategy because they don’t have the bandwidth to do
the analysis internally. Bringing in a strategist to help guide the development process, making sure you gather the
right data, and ensuring objections are raised and considered is smart. However, GMs must be involved in the strategic
direction of the business. That’s their most important responsibility. I once worked with a GM who "wordsmithed" the
revision of a rarely used brochure and vetoed three holiday party locations, yet he didn’t have time to read a highly
detailed, third-party analysis of his complete competitive set. Strategy is like aiming the gun before you shoot.
Unless you’ve unlimited bullets, you want to make sure you know what your target is, where it lives, and who else is
stalking it.
Put On Oven Mitts First, but Grab for the "Political Hot Potato"
Hiring a consultant because you’d rather the executive team shoot a messenger who is not you is valid. Recommending that
the company kill the CEO’s pet project or stop investing in a cash cow can put you in hot water. However, if you thoroughly
document your recommendation—and build support for it along the way—you’ve little to fear.
- Make sure you are well armed and armored. Anticipate concerns and find the data in order to respond, before
you walk into the meeting.
- Shop your ideas around, and handle the objections before the big meeting. Make sure you know which of your
peers and your boss’ advisors are likely to disagree with your point of view and work with them to resolve the issues
prior to prior to presenting your plan.
- Don’t be a wimp! You may find that your colleagues will admire you for your guts, and your boss will
appreciate your thorough assessment of the situation. You owe it to yourself and to your company to tell the truth.
Use Your Project Intimacy to Your Advantage
Many GMs think that they can’t offer the same objectivity that a consultant can because they’re too close to the
situation. As a result, they totally remove themselves from the process. Objectively analyzing data is very different
from collecting independent data. If you think executive management will assume you to be biased, you just need to provide
the facts and build a simple story that highlights the data, considers objections, and puts them together in a logical
manner.
As an "insider," you have a big advantage. You understand the business, know where the best data is, and may already
have a good grasp of who your competitors are. Some of your information may be old and require verification, but it’s
a great starting point—and is the perfect time to bring in a consultant if you don’t posses the right skills for
building long-term plans. Strategy consultants know how to ask the right questions and pull together the data necessary
to clearly define a business opportunity and evaluate the strengths and weaknesses of different options. However, they
will never know your business as well as you do, so make sure to work closely with them.
Start with the Answer
You don’t need an MBA or a stint at McKinsey to develop a sound strategy, nor do you need every piece of available
data. But you do need to ask the right questions and gather the necessary information to answer those questions, and
you must show the opportunity size, cost of entry, competitive landscape, and barriers to entry. Getting valuable data
isn’t the hard part, it’s much more daunting to cull the data—there’s so much out there! Some resources include:
- Websites and marketing materials contain a lot of competitive information
- Former employees and vendors are additional resources for competitive information (just make sure they’re not violating confidentiality agreements)
- Customer perspectives are available via a number of ways, from online surveys to in-depth product validation sessions
- Industry research from various third-party groups, including industry associations, publications, analysts, and market research groups
- Hoover’s and other resources that provide information on public companies
The big challenge after collecting the data is making time to review it and determine which parts are relevant to
your business. One technique successfully used by large consulting firms is to write a report based on your hypothesis
before you have the data. You’ll need to leave a lot of it blank and be willing to change the pages significantly,
but this approach can help you stay focused and minimize the risk of getting lost in rat holes. For example, if the
question is "should we enter this market," the hypothetical answer might be "Yes, because the opportunity is large,
the cost of entry is low, or the barriers to entry for competitors are high." The question and the corresponding
answer(s) determine which data is relevant.
Whether you gather and crunch this data yourself or delegate the task to someone else, make sure you understand it
and can discuss and defend it.
Find Others to Validate Your Assessment
Sometimes, even if you have plenty of outside data and a well-constructed argument, your executive team may want
an outsider to validate your assessment. Outside data and endorsements can often help you sell your plan. A third party
can also identify holes in your argument that you may not see. However, obtaining an outside opinion doesn’t always
necessitate a consultant. It might be a peer from elsewhere in your organization. Maybe it’s a trusted vendor who
works with many players in your industry. Or it could be one of your customers, who often are the best outside
endorsement you can find. Shop your ideas around—early and often.
Put Your Company’s Long-Term Best Interest Ahead of Your Own
You’ll go far in business if you focus on what’s in the company’s best interest. However, it can be frightening to
take an objective look at the data and realize that the company’s best option leads to your role disappearing. A good
consultant will turn down a lucrative project if she isn’t the right person for the job or can’t add value in that
particular situation. Others usually recognize this kind of integrity, and it ultimately leads to stronger relationships
and better business for the consultant.
The same is true for corporate managers. Sometimes what’s right for the company doesn’t necessarily leverage your
best skills. If that’s the case, be open to moving on, either within or outside the organization. If you truly want
to think like a consultant, focus on the projects at hand, do a great job, and then move on to the next project where
you can really make an impact. If you find this at your existing company, great. If not, be open to leaving. I’ve
found that most people stay at a company about a year longer than they should.
Why waste your valuable time in a role where you aren’t making an impact. Staying focused on your company’s
strategic objectives, working on projects that make a difference, and being honest and fair in your assessment
of new opportunities will make your work more exciting, more fun, and ultimately more rewarding in every way. And
remember, taking a risk and thinking like an outsider can do wonders for your business, your company, and your own
morale.
Robbie Baxter is a principal at Peninsula
Strategies, a Silicon Valley-based strategy consulting firm. Robbie helps people analyze market opportunities and
risks by examining the competitive landscape, analyzing the industry as a whole, and talking with prospects and customers.
Robbie honed her analytical skills as a consultant in Booz Allen Hamilton's marketing-intensive practice, where she helped
Global 2000 companies respond to competitive threats, market dips, and new opportunities. She has had key roles at a number
of Silicon Valley startups, including Edify (now S1), ePronet, and most recently at myCFO, an online wealth management
firm serving the very affluent, where Robbie established and built the marketing function as an early member of the
management team. Her clients range from startups to industry leaders and have included Netflix, Yahoo!, Sun Microsystems,
and Discovery Stores. A longtime resident of the Peninsula, Robbie has developed very strong relationships with investors,
attorneys, and business leaders throughout the Silicon Valley community. Robbie graduated with honors from Harvard College
and received her MBA from the Stanford Graduate School of Business.
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