Brent M Eck

Author: brenteck

  • Understanding Strategy — Part 1: What we actually mean by the word

    Understanding Strategy — Part 1: What we actually mean by the word

    (First in a short series on strategy.)

    Strategy is a word that engenders strong opinions. It gets used in a dozen contexts and takes on a different meaning in each one. It’s taught in business schools. It’s thrown around in every conference room. In plain conversation it usually just means “what we’re going to do next,” or “the plan.” But what actually is a strategy?

    At work you hear it both ways. When something goes well: “we executed the strategy successfully.” When something goes wrong, it turns up in the criticism — someone wasn’t told the strategy, or doesn’t know it, and their work is suffering for it. Are those two sentences even talking about the same thing?

    I’m going to start this series with an admission: most of us don’t share a common understanding of what strategy is, and, just as important, what it isn’t. The concept stays slippery for most people in business, even very good ones. I’m also going to start from a simple position — a business needs a strategy, and that strategy has to be clear and genuinely understood by everyone in the organization for any of us to do our best work.

    So before anyone can talk about their strategy, they have to get aligned on what the word even means. Over years of running companies I’ve watched teams use “strategy” to mean five different things in the same meeting, then wonder why nothing lined up. To be experts on our strategy, we first have to become experts on strategy.

    I’d like you to become one with me. For some of this will be review; for some, brand new. I’ll lay it out over a short series, in bite-sized pieces, and I’ll borrow liberally from two people who’ve thought harder about this than almost anyone:

    Michael Porter — the Harvard professor who, more than anyone, wrote the book on strategy (several of them). Widely regarded as the authority.

    Kurt Verweire — of Vlerick Business School, whose framework helped my teams re-engage with what strategy actually meant for them and frame it in a far more useful way.

    Next time: what strategy is, and, just as important, what it is not.

    — Brent

  • Fall in love with the problem before you start envisioning the solution

    Fall in love with the problem before you start envisioning the solution

    “The hard part is getting to precisely the right question; the answer is the easy part. At the point at which you can properly form the question, the answer is comparatively easy.” — Elon Musk

    One of my favorite weeks of every year is a leadership offsite — the whole executive team in one room, working on strategy, on leadership, and on how to collaborate better as one company.

    A group of us once kicked off the week with an exercise called “Color Blind” (originally built to train air traffic controllers in communication). We were blindfolded and handed an envelope of strange shapes in supposedly different colors — blindfolded, we had to take the moderator’s word for it. The goal: identify the two pieces missing from the full set distributed across the group. We couldn’t exchange or share pieces. And the only question the moderator would answer was, “what color is this piece?”

    We noticed a few things quickly.

    We were a very polite group. At least until we were nearly out of time.

    Many of us were over-jet-lagged and undercaffeinated, and did not take kindly to showing up to an important meeting and being immediately blindfolded.

    And, assuming we’d even heard the instructions correctly, we had no idea what was happening.

    A polite chaos set in. People shouted questions the moderator wouldn’t answer. People described the shapes in their hands, loudly — have you noticed everyone speaks several decibels louder with a blindfold on? Everyone was proposing some flavor of solution that made perfect sense inside their own small, blindfolded world. The clock was running. This is a group that likes to win. The anxiety climbed.

    “Hey — what on earth are we actually doing here?” one of us finally blurted out. That was the break we needed. For a second we got out of our own heads and realized that if we were going to get anywhere, we first had to agree on what we were even trying to do — what problem we were solving. We weren’t aligned on that, and so every individual solution was dead on arrival.

    Without a shared understanding of the problem, there was no way to tap the collective wisdom of the group toward a solution none of us could reach alone. And in this case, it was literally impossible to solve alone.

    We’re trained to be solution-oriented. We praise it — if you’re not part of the solution, you’re part of the problem. “Problems” get all the negative framing the word carries. But that exercise reminded us of what most modern best-practice frameworks have landed on independently: you have to be problem-oriented first. If we don’t all see the same problem, we can’t get anywhere together.

    I see it constantly. A piece of feedback comes in from a customer, or we notice what a competitor is doing, and the room starts frantically brainstorming — a collection of individuals racing to “keep up.” We jump to solutions. But what if we slowed down and made sure everyone in the room, ourselves included, understood the problem deeply and in the same way? Looked at the why behind the why. Asked whether the problem is temporary or structural, and how it connects to our strategy and our position in the industry.

    Design thinking starts here — with empathizing, understanding, sitting in the problem first. Agile starts here too — clarifying the requirements, making sure everyone understands the problem, before cycling into planning and design. It’s been said a hundred ways. “Give me six hours to chop down a tree and I’ll spend the first four sharpening the axe.”

    School trains the opposite reflex. When a professor asks a question, you give the answer — the solution. You don’t get to push back and tell the professor the question is wrong or incomplete. But the real world has far more degrees of freedom than a classroom. The first questions worth asking are: what problem are we actually trying to solve? What about the question might be misleading or wrong? What constraints are we assuming that don’t really exist? Do we even need to solve this — and if we did, what would we actually be accomplishing?

    It isn’t easy. Try it in your next meeting. Before offering a solution, offer another angle on the problem. Work together to make sure you share the same understanding of it. Make sure it’s the right problem, and a solvable one — or one that even needs solving.

    Here’s a real one. A team I worked with was trying to “increase adoption of our e-commerce platform.” They built genuinely great communications — sharp metrics on the benefits of running on the platform. Internally, everyone loved them. The sales team loved them. Based on open rates, customers seemed to love them too. Beautiful work. And nothing happened. No new accounts. No revenue lift. None of the goals hit. Back to the drawing board.

    But where do you start at that drawing board? Jump straight to more creative solutions? Or ask whether we were solving the wrong problem in the first place? Maybe the battle to get those customers onto a platform was already lost, and we’d identified the wrong problem entirely — something we probably could have seen just by looking at the data we already had. How you frame and understand the problem is the single biggest factor in any solution that follows.

    These are some of the hardest lessons in business. How often do we fall in love with solutions that never pan out? How many solutions have we built for problems that didn’t need solving — problems that then carry an ongoing maintenance tax, so we keep pouring energy into a dead end? (See the next piece, on the sunk cost fallacy.) We’d find a lot more success if we spent more of our time understanding and falling in love with the problem, and ran small tests to make sure the problem was worth the effort and the solution actually fit it.

    On a personal note: this is the one I most often get wrong. I love ideating, and I fall in love at first sight with solutions long before I understand the problem — intuition running wild, assumptions stacking up, dots connected that may not be there. Finding the right problem and learning to love it is far more work than falling for the next clever solution. It takes time, introspection, the willingness to challenge your own assumptions and biases, openness, and a deep well of empathy. Most of all it takes the courage to change your mind, and to admit you were wrong.

    I’ll hold you to being problem-oriented instead of solution-oriented if you’ll do the same for me.

    (See also the most interesting three minutes of an Elon Musk interview, 3:25–6:25: https://youtu.be/cIQ36Kt7UVg — and this from HBR: https://hbr.org/2012/09/are-you-solving-the-right-problem)

    — Brent

  • The Sunk Cost Fallacy

    The Sunk Cost Fallacy

    A friend tells you about a movie you absolutely have to see. You go online, find a time that works, and buy a ticket — non-transferable, nonrefundable, the works. Time passes. As the showing gets closer, another friend throws a dinner party the same night that sounds like more fun. You’ve been at your desk all week, and the idea of sitting still for another two or three hours has lost its shine. A third friend tells you the movie isn’t even that good.

    If you go, you’ll spend the evening on something you’re now lukewarm about and miss out on the rest.

    If you don’t go, the money is wasted.

    What do you do?

    Here’s the thing economists will tell you: the moment of waste already happened. It happened when the money left your account. That outlay can’t be recovered — it’s gone. The cost is sunk, and it should play no part in deciding what comes next. The only costs that belong in the decision are the ones still ahead of you. Future choices should be a clean comparison of the current options, with no weight given to what’s already spent. Letting the past expense pull on the decision is exactly the sunk cost fallacy.

    We’re all prone to it, at a few levels. The extreme version is continuation bias — the unwise tendency to stick with a plan that’s clearly failing. We can all find examples in our own lives, personal and professional. A close cousin is spending real resources to solve problems that may not exist; smart people burn enormous amounts of time solving things that never needed solving.

    And even when we know the logic cold, we can’t quite help ourselves. We’re more or less wired to commit these errors. Underneath, here’s what’s running:

    Loss aversion. We tie a future value to a price we already paid, even though the cost is behind us, not ahead.

    Framing. How the situation is presented — even how we present it to ourselves — shapes whether we feel a loss or a gain. Call the ticket “wasted money” and we recoil. Call it “long gone, and a chance to make the next few hours better” and the picture changes.

    Over-optimism. Once we’ve invested in something, we quietly inflate its odds of paying off.

    Personal responsibility. We feel accountable for our past choices, so we defend them.

    Not wanting to look wasteful. We throw good money after bad all the time. It’s striking how much the imagined judgment of others — even strangers who hold no such opinion — drives our decisions.

    So what’s the takeaway? Notice when you’re doing it. Focus on not over-committing before the decision is made, and once it is, choose based on the best opportunity in front of you right now — the expected return from here forward — regardless of what time or money is already sunk.

    Learning to tell the difference between sunk and prospective costs, and deciding from that distinction, is one of the most useful reflexes you can build in business. Good pivots, changes in priorities, the discipline to walk away — they all come from it. We often accuse each other of changing direction too quickly or destabilizing things with shifting priorities. Sometimes that’s fair. But just as often, what looks like instability is actually the healthy thing: focusing on future potential instead of honoring a sunk cost, or worse, riding a continuation bias straight into the ground.

    (More on this: https://en.wikipedia.org/wiki/Sunk_cost)

    — Brent