Several months ago, I wrote a blog post celebrating the beginning of a new decade – I called it the Launch Decade. This was just as the current COVID-19 pandemic was beginning to surface in Wuhan, China. As an optimist, I view global crises like this one as a launchpad to drive significant positive change.
But that certainly won’t happen on its own. We need to adopt approaches that will help us to navigate through these trying times and target the significant opportunities that lie ahead. For a long time, I’ve been a proponent of three approaches that become even more compelling in times of great change – zoom out/zoom in strategies, shaping strategies and leveraged growth.
Zoom out/zoom in strategies
This is an approach to strategy that has been pursued by some of the most successful tech companies in Silicon Valley, as I have written about here. This strategy focuses on two time horizons.
The Zoom Out time horizon is 10-20 years and the two questions on this horizon are: What will relevant markets or industries look like 10-20 years from now? What are the implications for the kind of business or company we will need to become in order to thrive in this market or industry?
The Zoom In time horizon is very different – it’s 6-12 months. On this time horizon the key questions are: What are the 2-3 initiatives (no more) that we could pursue in the next 6-12 months that would have the greatest ability to accelerate our movement towards the longer-term opportunity we have identified? Do we have a critical mass of resources committed in the next 6-12 months to these 2-3 initiatives? How would we measure success – what are the metrics that matter?
This approach to strategy becomes even more compelling in times of great pressure like today, where there is a strong urge to shrink our time horizons and just sense and respond as quickly as we can to whatever is going on. While understandable, a reactive approach risks spreading ourselves too thin as we try to sense and respond to everything.
The zoom out/zoom in approach to strategy helps us to focus on a very big, long-term opportunity so that we can prioritize our near-term actions for the greatest long-term impact and avoid the risk that we incrementalize our way into oblivion. At the same time, this approach to strategy also emphasizes the need for aggressive short-term action and the opportunity to learn from that action. At a time when all our institutions are going to be coping with the challenge of limited resources, this approach can help to focus those scarce resources to move quickly and target significant emerging opportunities.
Crises like the one we are in can be catalysts for significant restructuring of markets and industries. Those who move forward assuming their market or industry will continue in its current form are likely to be in for a big surprise.
In this environment, there’s a significant opportunity to pursue shaping strategies, which I’ve written about in more depth here. Rather than passively trying to anticipate what the future might look like, shaping strategies seek to restructure markets and industries in ways that put the shaper in a privileged position.
Without going into too much detail here, shaping strategies consist of three components. First, they begin with a long-term shaping vision of what the industry or market could look like 10-20 years from now (note the intersection with zoom out/zoom in strategies) and they frame this vision in a way that highlights significant opportunities for a large number of other participants, and not just for the shaper. The goal here is to motivate many third parties to come together and invest to support the shaping strategy.
Second, shaping strategies deploy a shaping platform with the explicit goal of improving the economics of participation for these third parties. These platforms are designed to reduce the investment required to participate and to accelerate the ability to earn returns on investments made.
Third, shaping strategies involve a set of initiatives designed to overcome the potential skepticism of third parties by demonstrating the commitment of the shaper to the strategy and the ability of the shaper to successfully pursue the strategy. This could involve making a bold move on its own or potentially announcing partnerships with large players that would give the shaper access to key resources.
Shaping strategies are especially powerful in times of crises. Crises tend to challenge our current approaches to markets or industries and make participants more open to new approaches than they might be when the market or industry is doing well. By emphasizing the need to mobilize investment from a large number of third parties, shaping strategies also help the shaper to significantly increase impact, even when faced with the challenge of limited resources in the short-term.
Not all companies will choose to be shapers, but the choice is to shape or be shaped. If we choose not to be shapers, then we need to recognize that, in times of rapid change, other companies will emerge as shapers of our relevant markets or industries. We need to anticipate who those companies might be and find ways to participate effectively in the markets or industries they will restructure.
When companies address the need for growth, they tend to focus on two options – make or buy. We can grow either through internal investment and organic growth or by going out and making a major acquisition. In either case, growth requires significant resources – something that can be especially challenging as we come out of an economic downturn.
But the good news is that there’s a third option that is rarely considered, much less actively pursued. It’s what I call leveraged growth, an approach that I’ve written about here. This approach involves connecting with and mobilizing a growing number of third parties who can deliver value to your customers and capturing some of that value for ourselves. This approach to growth has been pioneered by companies in Asia and there’s a lot that Western companies can learn from their experience.
Think about the implications of this approach as we emerge from the current crisis. Companies that can show significant growth without a major commitment of resources are likely to be richly rewarded.
So far, I’ve been framing these approaches in the context of companies. I hasten to suggest that these approaches are not just relevant for companies. They apply to all our institutions that are wrestling with the challenges of the current crisis – governments, schools, community organizations, NGO’s, etc.
But, there’s more. They also apply to us as individuals. Now, more than ever, we need to zoom out and zoom in to bring more focus into our lives so that we can achieve more impact that’s really meaningful to us. We need to find more creative ways to shape our context so that we can achieve even more impact. And our personal success will hinge on our ability to mobilize others who can provide value to those who matter to us, so that we’re not trying to do it all ourselves.
Crises can be launchpads for significant positive change. But that change will not happen on its own. It’s up to us to overcome our fear and to take action. And we’ll have a lot more impact if we come together with others, inspired by shared opportunities. If we do this right, we have an opportunity to unleash the exponential potential that resides within all of us and that is hungering to be drawn out.