Not So Fast! When You Get a New Insight, Don’t Jump to Conclusions
Here is an article I wrote for the American Marketing Association's 7 Big Problems blog series, based upon the content of my book, The Insight Discipline.
When you’ve gained a new insight about change in your industry, you may assume that its implications are obvious and you need to rush into action. But before you start sprinting down what looks like the desired path, it’s worth considering some alternatives. Consider the experience of some firms that may have jumped the gun.
Hurry Up and Wait?
That’s what the team at a boutique financial services firm wished they’d done when they first realized that their target customers were beginning to seek – and pay a premium for – multi-product solutions from a single provider rather than “picking and choosing” among products from many companies. The first reaction of the boutique firm was to mobilize its in-house product development teams to begin building out an expanded product portfolio quickly.
However, within three months the strategy team realized that they’d underestimated the time and costs of developing and marketing so many new products against strong competitors in domains where the firm had little brand recognition. They were able to call off the fast-track development effort and began assessing alternative strategies. The team ultimately decided to expand their firm’s portfolio by becoming a distributor of other providers’ established products, which the firm was able to accomplish far more quickly and profitably than if they’d developed new products themselves.
Seek Multiple Responses to the “So What?” Question
When I coach strategy teams, I use a number of techniques to help them unearth high-level implications of any new insight before they rush into formulating action plans. At this stage, it’s valuable to engage managers from multiple functional areas because with their varied perspectives, they can each envision very different implications of a newly understood change in the industry.
For example, if you’ve realized that your firm is being outmaneuvered by a rival with new technology, here is how managers in various functional areas might assess the implications:
Finance: “We need to invest in a third-party partner who can help us catch up in this arena.”
Marketing: “We need to develop alliances with professional groups who know how to promote our existing proven products with various stakeholders.”
Human resources: “We need to hire new tech talent who have skills that do not now exist in our organization.”
Operations: “We need to acquire some new capabilities that will lower our production costs.”
Legal: “We need new types of contractual relationships.”
Give All Participants a Conversational Green Light
Each of these possibilities can shed light on new strategic options worth consideration. For any discussion of high-level implications, I encourage teams to agree on a few rules that will maximize participation and increase the likelihood that important options will be identified.
Agree that no question is out of bounds – Get all questions out on the table.
Encourage participants to ask novel implication questions – What have you never considered?
Ensure that participants understand it is an iterative process – Surface all the big possibilities now; you can evaluate them in more detail later.
Ask participants to identify additional possible implications – What else are we missing?
These are just a few of the techniques for assessing implications in my book The Insight Discipline: Crafting New Marketplace Understanding that Makes a Difference. I also encourage you to read and comment on my other AMA blogs.