Review of the Book: “How to Think Strategically – Your Roadmap to Innovation and Results”

By Davide Sola & Jerome Couturier

First published 2014 by Pearson

This edition, Pearson (FT) 2014

ISBN 978-0-273-78587-3

The basic premise behind the book is that thinking strategically is something we all do all the time. It is part of normal living. We are constantly checking to see if the benefits we get from our actions are worth the effort. In our private lives the benefit is usually happiness, in business it is value (e.g. profit). If it isn’t we change, you guessed it, our strategy.

The authors are ex McKinsey men and it shows, the book has many tools and diagrams credited to McKinsey. As consultants they would have been breaking down complex client problems into digestible chunks. Bringing coherent thinking where chaos and lack of direction often existed.

I have given the book 5 stars the highest possible rating. The book worked for me, but it might not for someone else so here are my reasons why I gave it such a high rating.

The book is targeting business strategy and indeed covers every aspect of it. I will be using the book as a useful reference; it has everything in one place. Even if you are new to the world of business or have been working for decades I think you will find it useful.

It is called ‘How to Think Strategically  – Your Roadmap to Innovation and Results’. It also reads like that, a series of logical statements to develop and bring to market new innovative products and services.  The book is laid out well, short and to the point chapters with key text highlighted and a key message at the end of each chapter.

However I found myself reflecting on the topics raised in the book and comparing it to my own 20 years working in innovation and strategy. At times the examples in the book sometimes tended to be just too generic. In fact that would be my only criticism of the book as it covers such a wide spectrum it never really goes into depth on any one topic. Obvious things like why Nokia failed are mentioned but it is put down to internal biases and error of judgment. True but isn’t that obvious or easy with hindsight? The true story comes out on p10 ‘…almost always we can only have a reasonable view of the future for a very limited period of time’.

So be warned the book will help you become familiar with the topics, but familiarity alone is not enough, you will need to think hard how to apply these topics and techniques in your own company.

Part 1: Strategic Know-How

Part 1  of the book takes a candid look at how our mind works (NOTE: the first two chapters of ‘The Organised Mind’ by D. Levitin covers the same material but in more depth and is at times easier to read and most of ‘Thinking Fast and Slow’ by D Kahneman, which is tough read.) leads us to a basic understanding that without nurturing our creative thinking we will not really succeed by simply applying logic alone. In addition, our unconscious thinking processes are based on Mental-Models which form the cornerstone of our biases and while very efficient they are often less than effective and often result in poor judgement. We have only a very limited capacity for conscious thought. In fact the authors come to the conclusion that “….strategic thinking is only when the complexity and uncertainty are high and the risks and rewards are considerable”. Never the less the authors list out the 4 fundamental strategies (from Porter) and their attendant standard recipes for value creation e.g. going for low cost. No big surprise.

Part 2: The Strategic Planning Process

Part 2 of the book gets down to the business of actually dealing with the process itself. It outlines how to deal with Corporate culture (called the invisible hand). How to assess your situation, relying heavily on Porter and his 5 forces. Then how to identify and solve the core challenges, relying on the techniques from McKinsey.

The authors break the Strategic Thinking Process down into 5 parts.

1. Observation: The ability (i.e. having the time for reflective thinking and being able to override your instinctive biases) to spot what people really want rather than what they think they need or what you think you can supply, The authors indicate, as an example, Steve Jobs and his insight that people would pay for music, even in the era of music piracy with Napster, if it was made extremely easy to use. Or low cost airlines where the insight is that many people just want to fly from A to B so most passengers are not responsive to sell up features offered by airlines many are only driven by price. Observation is not the preserve of any one individual; make sure your company creates a culture of observation rather than just leaving it to one or two individuals.
2. Identifying the Core Challenges: Clarify the higher goal, it must be motivational and important, it is not a short term operational goal. Find the core challenge that is blocking you. Most companies seem to be blind to the core challenges; blinded by biases e.g. having always worked in a particular way they are not able to see the real problem let alone a core challenge. It takes creative insight to actually identify core challenges.
3. Solution Development: This is usually complex and involves several tasks requiring different steps e.g. conceptualisation or experimentation. The solution always has novelty, creative or lateral thinking is required. (p33).
4. Testing Solutions: Work out a concept / idea statement. Then go into ‘lean testing’. See each experiment as a source of additional insight. There is no perfect answer for the future but there are techniques to actually test a hypothesis in a cost effective way, e.g. a Minimum viable product or even a minimum viable feature.
5. Rollout or Pivot: Identify the resources needed, people money etc. Pivot means returning to the drawing board after a pilot or partial rollout. In fact the final chapter of the Book called ‘Managing Execution’ is all about change management. Full of common sense. Some will have implemented many of the ideas; most will have been at the receiving end of change management at some stage in their career.

All told quite a valuable reference book, the bottom line would be that logical thinking will not provide you with great answers only good ones, so learn to cultivate your creative talents as you work logically through the process.