How do great strategists think?
Some thoughts on strategic thinking
How to become a strategic thinker
Some thoughts on strategic thinking
“The future is already here. It is just not evenly distributed yet.”
William Gibson
It is unknown who created the world’s first online store. Many believe it was Jeff Bezos, who registered the company Amazon in 1994 and launched the website in 1995. But on the Internet, you can find information about Charles Stack, who supposedly launched an online bookstore on the domain books.com (which belongs to the bookstore chain Barnes and Noble now) back in 1992. But what we do know is that Jeff Bezos, unlike Stack, became a successful entrepreneur.
He once said that he came up with the idea of Amazon while reading a newspaper article about the growing number of internet users. At first glance, his reasoning looks perfectly logical, but we have to consider that the first Internet Browser, Mosaic, allowing unskilled users to surf the net, was released only in 1993, a year before the article was published. Even in the USA, the number of internet users didn’t exceed 5% of the population, and the future of the net was not clear. At that time, it looked like massive information storage rather than a marketplace. So the idea of online shopping was genuinely revolutionary.
Jeff Bezos connected two dots: “Internet” and “commerce”. Is it possible to learn doing it on a regular basis or is it magic available only for few geniuses?
Diffusion of innovation
Scientist Everett Rogers called his theory "diffusion of innovation". He found that the development of any innovation moves along a similar trajectory. First, it is picked up by "Innovators," which are usually about 2.5%. These are people starving for novelties. They are followed by "Early adopters" (13.5%). Most users come to innovation in the stages of either "Early majority" (approx. 34%) or "Late majority" (also about 34%). There are also 16% of "Laggards" –stubborn conservatives who master innovation only when everyone around them does it. For example, my father still uses a push-button phone.
Of course, this cycle is shortened with the Internet and social media development. But still, it is not measured by days or months. Booking.com was founded in 1996. In 2019, the company’s revenue amounted to an impressive $15.7 billion. But back in 2007, its turnover was ten times smaller. The first Bitcoin was generated in 2009, but it really «soared» only in 2017.
Most people notice the changes only when they become the norm. A minority — “innovators” do it some earlier. But the ones who create something revolutionary new detect the slightest shifts and turn them into business opportunities. And it may seem that only few gifted people like Bezos, Jobs, or Musk can see something covered by the mist of the future. But the truth is that this skill can be learned.
Signals of change
The experts of the Institute For The Future (California), where I studied foresight techniques, use the term “signals of change”. By this, they mean signs of minor changes in the world around us that may (or may not) lead to global shifts in our lifestyle, work practices or consuming behaviors. As it is said in the epigraph for this article, signs of the future are already here, everywhere, but we just don’t notice it, being overloaded with our day-to-day duties. But one can switch her mind to begin seeing the world from a different perspective.
A Mental exercise
Try to make a list of changes, even minor ones, that you’ve spotted recently. You might read about them in the news or notice them in your everyday life. Use the Internet to find more signals. Don’t pay too much attention to the obvious changes such as the oil price rise. Here are some examples of the signs of change a group found during a strategic workshop I conducted some time ago:
· The Swedish government is considering a tax on meat because livestock produces 51% of all greenhouse gas emissions.
· Even bankers and top executives rarely wear suits and ties after the pandemic.
· Remote or hybrid workstyle reduced the number of “water cooler chats” in offices, which made it harder for workers to socialize and discuss minor issues.
· Interactions between businesses through personal website accounts in the B2B world have become a thing of the past. More and more companies opt for direct ERPs integrations.
At first glance, these signals seem unrelated, and maybe they have nothing to do with your business. But firstly, you may create your own list. Secondly, don’t jump to conclusions. Instead, brainstorm with your team and try to find a connection even if it is not noticeable. It is a creative and essential part of the task, and the best ideas seldom come from evident notions.
What shifts will those changes bring to your industry? What business opportunities do they open up? I prepared a short and absolutely free online course on how to learn to connect the dots — feel free to try it here.
Not a panacea
Even if you form a daily habit of tracing signals of change and discussing them with your colleagues, it won’t inevitably make you a successful entrepreneur. But it will certainly help you switch your mind from daily routine to the search for opportunities and improve your strategic thinking skills.
Epilogue
On October 24, 2010, Steve Jobs sent a very important email. It contained the agenda for the company’s upcoming “Top 100” retreat, a top-secret and super-exclusive offsite management meeting that was reserved for 100 of Apple’s most influential employees. The first point on the agenda was entitled “2011 Strategy”.
Jobs clearly established the single most important priority for 2011, which he termed “the year of the cloud.” Apple “invented” the digital hub concept, wrote Jobs, by using the PC as a hub for digital assets like contacts, calendars, photos, music, and videos. But the digital hub was shifting from the PC to the cloud, and Apple had to move fast. “Google and Microsoft are further along on the technology,” he wrote, “but [they] haven’t quite figured it out yet…. [We need to] tie all of our products together, so we further lock customers into our ecosystem.” It is a brilliant example of connecting the dots.
Svyatoslav Biryulin