“Whenever I hear [the word] ‘culture’… I release the safety catch from my Browning!” – Hanns Johst (1933)
“Whenever I hear the word culture, I bring out my checkbook” Jean-Luc Godard in “Le Mépris” (1963)
For many business school professors, the issue of what strategy is (or indeed isn’t) has long been a hot topic. Yet in real world corporate contexts,”strategy” is that thing you try to put together when:
- Your company has been successful in the past (though nobody actually knows why or how)
- It still has a reasonable amount of cash in the bank, but…
- Its #1 cash cow has just died a sudden death (and you can see that #2 & #3 are swaying alarmingly too)
- Everyone has a radically different opinion on why it’s all gone pear-shaped, but
- Nobody has any actual idea.
- In fact, nobody even has any usable data, because the company has relied on vanity metrics since Day One
Basically, the company is staring imminent financial collapse in the face, and it’s a downright ugly sight. Yes, all those carefully-staged sales meetings in Las Vegas (you know, the ones with hot tubs, hotter women, designer Martinis and class-A drugs) will soon be ancient history, and you’ll all be back to wearing cheap suits and working in Basingstoke in some database firm’s middle-management cadre.
So, things aren’t just bad, they’re baaaaaaaaaaad. Hence it’s plain as day that you all really need to do something, and do it fast. However, the practical problems the company faces are intensely political:
- You’ve got more Chiefs than Native Americans (is that PC enough for you?)
- Everyone has been told for years how clever they are for making the investors rich, rich, rich
- Everyone has somehow come to believe their own stupid hype
- Nobody wants to lose one iota of their insanely cosseted privileges
- Everyone knows that something has to give, but
- Everyone wants the thing that has to give to be someone who isn’t them.
- Nobody honestly trusts anyone else (which, given what a bunch of sharks they are, is completely justified)
- There are three or four extraordinarily dysfunctional silos of wickedness actively plotting against each other
- Anyone trying to change even the smallest thing would end up being kicked around for weeks or indeed months
- Nothing that happened could have been anyone’s actual fault, everyone is a consummate professional, right?
- Even though everyone’s about to lose their job, they’re extremely fond of things the way exactly they are.
All in all, this is the real-world context for corporate strategy, because in almost every other case, what will actually get the nod is the default do-nothing position (i.e. “carry on doing what we’ve always done because it’s made us all rich, hasn’t it?“). Really, how hard do you think anyone is going to bother to fight against the (small-c) conservative wisdom of “if it ain’t broke, don’t fix it“?
So, your company’s stuffed in the short-to-medium term, but what on earth can you actually do about it? Is anyone inside this organization quite so foolish and personally reckless as to stick their stupid necks out by putting a turnaround plan in front of the board? Of course they aren’t, don’t be so utterly ridiculicolous. “I pity the fool”, etc.
This is the precise point in an ossified corporate’s lifecycle that external management consultants get parachuted in to propose an unconvincing MBA turnaround strategy: but in reality, what’s happening behind that whole strategic façade is that
- Investors are steeling themselves for a big hit on their portfolios
- Competitors are being sized up to see if they’re fool enough to buy the failing company
- Everybody is blocking every aspect of the turnaround strategy
- Everyone comes in every morning expecting to find a lot of blood (possibly theirs) on the carpet
- Everyone is fleshing out their long-dormant LinkedIn profiles
- The really proactive principals have already jumped
Needless to say, none of this normally ends well.
So, you could reasonably say that for corporates, “strategy” is essentially a billboard you plaster over a failing and grossly dysfunctional company to make it look good enough for a competitor to take off your investors’ hands.
For startups, though, strategy has a different meaning entirely. The central conceit of the business plan is that you have some kind of control over things, which for startups is almost always utterly false. Startups struggle even to influence buyers, let alone control them. In the same way, the whole (business school) notion of strategy fails abysmally for startups, because almost all are trapped in such a short-term cash-flow-centric view of the world that notions of long-term aspirational / strategic bets are simply out of scale to their cash-poor grimy suburban realities.
The terrible truth, then, is that strategies are like the mythological monkeys, in that there are only three of them: two corporate ones…
- “Carry on doing the same” (because the company is succeeding)
- “Pretend to be doing something new” (because the company is failing)
…and one startup one…
- “Hang in there” (until people start paying you money for what you do)
Business school professors be warned: whenever I hear the word ‘strategy’, I take out my AK47…