Back from the Future
“A strategy is a success story told backwards.” - Drake
Arguably one of the greatest things that Drake has ever said; it presents us with a way in which we can envision success - by inverting time and thinking backwards from the victory clause. Let’s consider the mission of one of the world’s best companies, Google: “To organise the world’s information and make it universally accessible and useful.” By inverting this mission, we can begin to understand what an early Google needed to do in order to achieve this:
Organising the world’s information would require it to invest not only in means by which to acquire that information (Google Maps, My Business, SEO, Webcrawler) but also to store it (Google Cloud). In order to make it universally accessible, Google would need to invest in a means by which humans could always see that data - their acquisitions of an operating system (Android 2005) and a handset manufacturer (Motorola 2012) make sense when we’re on the move and needing to see information. Being useful invokes their core mantra of being relevant. With the advent of AI, Google has been increasingly vocal about how they use it within their products to understand their users and provide the right information to the right user at the right time.
So how can we apply this tool to our own businesses? First, and foremost, there needs to be a victory clause. We need to ask ourselves what needs to be achieved for our business to have achieved its mission. For Nike, they would have brought inspiration and innovation to every athlete in the world; for Patagonia, it means saving our home planet. Once we know the victory clause, we can break it down into sizeable and achievable macro chunks over the lifetime of the business. We can then use it as a north star for how the different parts of the business will operate.
Consider that the 5 year goal of an organisation like Nike might be to sell $1bn worth of shoes - what would each department within Nike need to do over that period in order to achieve it? Given year 1’s sales need to be $100m, and given each store sells $10m worth of shoes a year, it makes sense for Nike to operate 10 stores during that year, increasing to 30 stores to achieve $300m in year 2 etc. With the $1bn number in mind, Nike could also then set out what it needs to achieve operationally over that time etc. These achievable macro chunks break down micro chunks for each individual employee in the business. For the sales person, it is about selling shoes every day; for the operations person it could be about how to increase traffic through their stores or their websites. At Google, we called these OKRs: Objectives and Key Results. These were only effective if they were measurable, time based, and in line with the company’s strategy.
Another way of thinking about strategy is avoiding stupidity. It may seem lame, but actually grasping what is in front of us is better than trying to reach for what we think is ahead of us. Simply by sticking to our knitting, humans can pull off incredible feats. One is reminded, that often after a move chess players take stock of what has happened and instead of asking themselves how they can win, they assess what the next threat is. Often we look too far forward when we should be mitigating against what is directly in front of us.
In conclusion, starting from the end and looking backwards helps us to digest the mammoth task ahead of businesses; it forces us to be more careful, more practical and less stupid. And thus ends today’s sermon.
