We are biased. We consider all the options that fit our needs — both those that conform to our preconceptions and those we are predisposed to throw under the bus to best illustrate our objective reasoning. The threats we acknowledge are the manageable ones we know can live with, our opportunities not much more than a wish list.
Let’s acknowledge that we’ll never have perfect visibility over the horizon. Some things will take us by surprise. And it’s very often our own fault. Because in our arrogance, our laziness and our shortsightedness, we don’t do enough navel-gazing due diligence to uncover our “un-strengths”.
Like most native speakers, you are arching your eyebrows at this non-word, “un-strength”. Think of an “un-strength” the same way you would a black hole or anti-matter. It’s there and while it currently defies explanation you can almost prove its existance.
A very helpful tool for uncovering “un-strengths” is the SWOT analysis. More eyerolling, I’m sure, but the over-used and rarely adequate SWOT, “strengths, weaknesses, opportunities and threats” matrix can show us more than the throw-away one-pager it typically rates.
The problem with the SWOT analysis is that more often than not, the SWOT-er fills in only the attributes that feel the best. Corporate mythology lives here, sacred cows graze here, preconceptions flourish here.
The only thing unwelcome is the Elephant in the Room which no one wants to acknowledge. And, as you no doubt recall, Kenneth David Kaunda, former President of Zambia, eloquently stated in his autobiography, On Violence, “do not call an elephant a mouse, unless it gives you great comfort to be trampled to death by a mouse.”
Here’s an example from recent memory that illustrates the problem:
Strength: A storied technology company considered its core strength to be its unique distribution network, which had evolved over decades to perfectly adapt to its host manufacturer. Like blind cave lizards, this completely adapted channel knew the manufacturer inside and out, primarily because most of them were former employees.
Weaknesses: while the company had deep penetration in specific verticals, it lacked what it considered to be widespread office market penetration. This was perceived by many in management to be a marketing problem, although the company had no ad budget.
Opportunity: figuring out how to counteract the weakness is usually the default ‘opportunity’ matrix entry, and this company was no exception; on top of this, the desire to be ‘fashion’ oriented and appeal to a youth market with fresher industrial design found its way into this area, as well.
Threat: as always, low-cost entries from Asia that had similar durability and performance encroaching upon the core vertical markets was the boogeyman under the bed.
Now, I may consider my strengths to be my chiseled good looks, my sophisticated wit, and of course my vertical leap. However, in my myopic world, I am only viewing myself relative to other desk-bound former athletes in their late forties. I’ve completely ignored the fact that I’m competing against guys who still take gym for credit, have papparazzi following them into and out of restaurants and clubs, and who get paid to rebound. In short, I’ve incorrectly set the boundaries of my competitive set. I certainly feel good about it, but I’m going to get blindsided pretty quick if I think others are going to agree with me in “the market”.
In our example, above, our company neglected to consider the total scope of potential distribution and channel coverage — there are others who can and should distribute their product, and who could and would penetrate the office market. Our blind cave lizards might be a bit pouty about it all, but they’d find that their business would be minimally impacted by the arrival of more mainstream competition — their adaptation still makes them viable in their own specific ecosystem. The youth market is fun and exciting, but as the products needed to serve this market had lower contribution margins than those serving the core vertical markets; as a result, they lived only in Power Point and they never saw the light of day. And the threat of low cost entries is correlated strongly to our manufacturer’s brand strength, which is a function of quality, aesthetics, durability, support, availability, value, and yes — that missing advertising strategy.
They incorrectly set the boundaries of their competitive set, their channel coverage, the scope and expectations of their marketing, and their own core competencies of product development, industrial design, and product strategy.
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> “Do not call an elephant a mouse, unless it gives you great comfort to be trampled to death by a mouse.” Couldn’t have said it better myself.
> When you decide you have a strength, expand your boundaries to include the entire ecosystem surrounding that strength. Is “industrial design” a strength? Compared to whom — your normal ‘usual suspects’ in your industry, or Apple or Logitech? According to whom — do your current vertical customers think so? What about the customers you wish you had? Or the ones you don’t have that went to your competitors? Hmm.
> You will not gain ground until you get past your own unwillingness to face facts.
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All these things can be corrected, too. But it takes guts to leave your preconceptions behind and slaughter your sacred cows. You feel a little naked and terribly unprepared once you’ve made this decision because, in the words of our former Defense Secretary, you’ve just taken an “unknown unknown” and turned it into a “known unknown”.
Facing facts is tough. You get a lot of flustered people in the board room when you do this — people who don’t want to admit to their board that they are not only not ahead, but behind. But this is a lot more comfortable than having your board bring this to your attention.
After you’ve been trampled to death by a mouse.
Copyright (c) 2006 Stephen Denny