The Leader’s Guide to Building an Everyday Strategic Practice: Lafley and Martin's 'Playing to Win'

A.G. Lafley and Roger L. Martin, Playing to Win: How Strategy Really Works, Cambridge: Harvard Business Review Press, 2013.

===============================================================

A.G. Lafley, CEO of Procter & Gamble from 2000-2009, is one of the most-respected and successful corporate leaders of the young twenty-first century.  Roger Martin, a long-time business consultant and currently Dean of the Rotman School of Management in Toronto, is among today’s most original and prolific management thinkers.  Having worked together for nearly three decades, the pair have written a book arguing that “strategy really works” through the development and practice of ongoing strategic leadership rather than the application of specific frameworks, analyses or best practices.

That said, Playing to Win does advance its own original model, which involves answering  five key questions:

     1.  What is your winning aspiration? 

          (The purpose and motivating objectives, financial and non-financial, of your enterprise.) 

     

     2.  Where will you play?  

          (The playing field – geographies, product categories, consumer segments, channels, vertical stages of production – where you can achieve this aspiration.)

     3.  How will you win?  

          (The way you will win on the chosen playing field or market -- your value proposition, profit models, partnerships, or competitive advantage.

     4.  What capabilities must be in place?  

          (The set and specific configuration of distinctive capabilities and reinforcing activities required for you to win in the chosen way.)

     5.  What management systems are required?  

          (The systems, structures and measures that enable your capabilities and support your choices.)

These steps and questions are interconnected, cascading into and reinforcing each other as visualized below:

Lafley and Martin nicely demonstrate how each of these questions can be answered and linked, mostly using examples from P&G like the creation of the new market category called “masstige” for the re-launch of Oil of Olay in 2000.  They mount a compelling and always accessible argument that includes a very helpful “logic” flow of sub-questions to help users make better decisions about each of the five major questions.  In doing so, they underscore how theirs is less an analytical than a process model, less about analysis or vision-formation or priority-setting and more about enabling continuous strategic thinking and decision-making. 

This is an essential insight because it shifts strategy from being about a static plan or analysis to being more about an ongoing process.  Put differently, the book emphasizes strategic management or leadership rather than a one-dimensional approach to strategic plan-making or priority-fixing like the BCG matrix or Michael Porter’s Five Forces (which makes an appearance here).  While such tools are important for assessing point-in-time conditions, Lafley and Martin focus on how they are really means to developing an everyday way of strategic thinking and acting. 

It is in that focus that Playing to Win becomes as much a leadership as a strategy handbook.  If the process model rolled out in the book is ultimately “an integrated cascade of choices,” both the strategic value of the choices and the motivations and drivers of those making the choices share emphasis here.   Repeatedly, the articulation of how the five questions can be answered is couched in some of any leader’s fundamental challenges and responsibilities: knowledge and information management, communications, decision-making.  Far-reaching and robust strategic analysis is a crucial part of that process but should finally be relegated to serve the leader’s wider obligations.  As a result, the leadership thinking celebrated here is integrated, disciplined and courageous, in part because it never grows too removed from decisive action. 

Yet one of the issues that arises in approaching the book as a guide for leaders concerns the potential wider applicability of lessons and insights that are mostly drawn from P&G.  With its scale, diversity and resources, one wonders about the relevance of the approach to strategic leadership to different types of businesses.  Lafley and Martin do cite other examples throughout, but they tend (think Apple, Google, or General Motors) to be similarly outsized compared to most businesses.  While no one size fits all, of course, some of the guiding assumptions here would be well-tested by smaller and creative firms.  There’s also the further, fascinating question of whether the rapidly changing relationship between firm and customer, client or public is more varied than assumptions grounded in P&G’s consumer goods markets allow.   

Upon reflection, the emphasis on strategic leadership thinking and action seems mostly quite promising for businesses of diverse sizes and market orientations.  For creative organizations, in particular, the centrality of creative talent and the aspiration to creative excellence can often make the requisite assessments of capabilities and systems more challenging.  In ways, though, that very need can be seen to recommend the embrace of more robust and ongoing strategic thinking and action outlined here.  “There is simply no one perfect strategy that will last for all time,” Lafley and Martin write.  “That’s why building up strategic thinking capability … is so vital.” 

Reading these lines brought to mind a memorable presentation I had attended in 2011.  At the Cannes Lions festival that year, the leadership of the award-winning and always forward-looking creative agency, R/GA, was recounting its history and also describing the thoroughgoing strategic review and re-organization it conducts every nine years (http://www.rga.com/about/featured/the-next-nine-years).  The review by Bob Greenberg and his team is certainly done in planned cycles.  A crucial takeaway from the presentation, however, is that these cyclical re-organizations are merely the most conspicuous outcomes of a thoughtfully developed and decisive strategic leadership capability that has proven enormously successful in creative communications.

A.G. Lafley is a renowned and passionate believer in deep customer understanding.  He nevertheless recognizes the limits of uncovering knowledge of shoppers and other end-users.  As he has observed elsewhere, “Customer research doesn’t tell you the answer. It is only an aid to judgment.”   That approach is also a good way to think more generally about Playing to Win.  While we can embrace the fundamental importance of strategic models and practices – even Lafley and Martin’s own – such knowledge must finally be less an end in itself than an aid contributing to a broader leadership practice driven by everyday engagement with purposeful prioritization, communications, and decision-making.

Nurturing Rebels and Unlocking Innovation: The Creative Turn in Business and Leadership

The CMO of frog, Tim Leberecht, recently wrote, "How to Nurture Your Company's Rebels, And Unlock Their Innovative Might" http://bit.ly/Uz6btM (the same piece appeared at FastCo. Design). Despite its brevity, the post gathers a range of examples and sources, from innovation communes and Ashoka Changemakers to Roger Martin and U2, of a telling shift underway today to embrace oppositional thinking in business. Both in cultivating internal opposition to enhance innovative outputs and in driving a more fundamental resistance to business as usual across industries, leaders and organizations are increasingly supporting varied creative processes that seek to disrupt the status quo.

For those in the creative or some R&D-intensive industries, especially, this approach and attitude to gaining competitive advantage may not seem new. But there are at least a couple significant developments in play here.  The first is nothing less than an historical transformation of the status of creativity and innovation in business. That's a far-reaching claim, of course, and one I've developed in my own teaching and consulting on creative leadership (and that Chris Bilton has also made). Essentially, the idea is that the last two to three decades have seen a dramatic reversal of the longstanding containment - or even marginalization - of innovation within organizations whose priority had been increasing efficiency, lean operations, and rational problem-solving. The change in mindset, epitomized by innovators in Silicon Valley and outlined most familiarly in the writings on disruptive innovation by Clayton Christensen, is now embraced across industries and beyond, including the non-profit and public sectors (think "creative cities").

Leberecht's post offers a range of examples of successful contrarian practices, small and large, as noted, and concludes by recommending three possible actions for those wanting to make internal oppositions within their organizations productive.  They are:

1. Create safe spaces
2. Make sure that internal opposition is constant
3. Embrace passive and active opposition 

These are sensible enough, though anyone wanting think more deeply about how to develop and deliver on this capability for this creative internal opposition should read Roger Martin's The Opposable Mind.

As important as is the call for more creative and productive internal opposition, it's a second development that I find potentially even more provocative and consequential. The image introducing Leberecht's post is a Jolly Roger and the spectre of piracy threads through his examples of creative opposition. Yet in celebrating the misfits and the rebels whom organizations and even project teams rely on for daring innovation and value-creating differentiation, the old challenge of successfully containing and incorporating oppositional thinking re-emerges. When Leberecht urges launching the development of creative opposition by asking such questions as, What is your company's black market?, in other words, one can easily extend the answer beyond that which is productive for particular organizations. Consider hacking, for example: while there are now "hackers for good," this has become a safely contained and manageable (and, by some individuals, often profitably self-marketed) subset of a larger category of creative rebels, many of whom are not "good" and indeed have proven themselves menacing.  

This is more than semantics. To think more deeply about disruption or opposition leads to the discussion of how essential creative destruction is to genuine innovation in organizations, industries and markets. Even more, though, to speak of creative leadership or innovation in terms of piracy and rebellion should necessarily take account of the boundaries of those organizations, industries and markets -- and also acknowledge the hackers, pirates, rogue traders, dark pools, black markets and more that exist beyond them. Their global rise over the last two to three decades of technological change and globalization has been every bit as dramatic - and illuminating about the nature of innovation - as that of loyal opposition whose work remains internal to corporations or industries.