It sometimes appears that the traditional rules of business are being upended by today’s mega-trends of multisided platforms, big data, machine learning and AI, crowdsourcing, the internet of things (IoT), and more. These trends have transformed the world of business immeasurably. But they have certainly not repealed the timeless rules of strategy.
Yet for too many entrepreneurs, especially those steeped in tech and devoted to product, strategy often seems to be an afterthought. Experiment and create a great product, the thinking goes, then scale, and then figure out the business model once you’ve succeeded. It’s true that nothing beats having a compelling product that customers badly want. However, while good products and good “shopkeeping” are surely good business, they are no substitute for clear-minded strategy.
Savvy entrepreneurs and business founders might come across any number of tool kits and frameworks — from jobs to be done to business model canvases to disruptive business models and industry forces, all while seeking blue oceans, and so on. Each of these has value and can be the source of useful ideas, but each represents only part of what strategy can offer.
The challenge of strategy is to develop an integrated view of the workings of your business and how it creates and captures value within its operating environment. So, rather than develop allegiance to one piece of the strategy puzzle, founders are best served by familiarizing themselves with the basic tenets of the field.
What’s more, my academic research on strategy in the contexts of multisided platforms, crowds, big data, machine learning, and IoT shows that it is only when timeless tenets are applied that entrepreneurs can sensibly plot strategy. Today’s strategy is just too complex, dynamic, and demanding to rely on partial storylines.
As a professor teaching strategy, most recently at Harvard Business School and Northeastern University, I have tried to offer the minimum essential explanation of an integrated view of strategy, to combine the best of the many frameworks that exist, show how they relate to one another, and distill the field to the essentials that entrepreneurs need to know to get started.
I’ve published my notes to that effect in a hundred-page working paper, and I won’t try to sum up the entire effort here. Strategy is hard work, and there are no magic shortcuts. What I offer here is a starting point: the most basic questions that every successful business must answer. Entrepreneurs who design their business around these questions will have a leg up when it comes to crafting strategy.
To begin, you can sketch out your answers to these questions on a single index card.