Discussions on digital: How strategy is evolving—and staying the same—in the hypergrowth digital age

Strategy is evolving in unexpected ways, as Silicon Valley thought leaders discuss in McKinsey’s latest Discussions on Digital podcast.

This article was written in the context of a digital marketplace. Many of my brick & mortar clients feel digital market issues are not germane to them but I believe it is an excellent laboratory to study what the future will bring for all markets—faster and faster change

 Is a three-year strategy horizon a relic of a previous era? 

Jon Weinberg, head of strategy at Sephora: I think there’s a role for a three-year vision in any company at any phase, because you still need to have the North Star that you’re shooting for. But the old system, when strategy was an annual executive get-together, just doesn’t work anymore because things are changing so rapidly in the digital space over the course of that cycle. It has to be embedded throughout the year, offsite and otherwise, or through executive-team meetings on a periodic basis. You have to make sure you’re bringing strategic dialogue into those interactions on a monthly basis—at a minimum, quarterly—given how rapidly things can change 

Jacques Pommeraud, former SVP and general manager of cloud services at Salesforce: My view is that the role of strategist, first and foremost, is the mobilizer. People need to understand where the company is going and take autonomous decisions. The main value of a strategist is to understand the vision for three years and mobilize the organization around the vision and what people have to do to get there. Then management has to empower flexibility and reactivity to adapt to current events, essentially. 

Jacques Pommeraud: Yes, but at the same time the way to manage a company has changed a lot in the last couple of decades, from “top down, the leader knows it all, let’s execute,” to a model that’s more like a federation, where you expect empowered teams to make the right choices and follow in the general direction. So it’s even more important to have a strategy that allows that federation of little teams to do what they have to do and not refer up the chain every time 

Jon Weinberg: The analogy I would use, coming from retail, is that there are two real philosophies to the customer-service model. One is principles based, the other is rules based. The migration has been from rules based to principles. Once you know the framework, you can make decisions to reprioritize allocations at the lowest level, because you can’t have the C-Suite constantly reprioritizing every dollar 

Jacques Pommeraud: At Salesforce what matters first and foremost is what we call “customer trust.” Then it’s “customer success.” Once that’s clear, everybody can make the smart choices at their levels without having to go all the way to management. One of the exercises we use—actually a great management tool—is called V2MOM. It’s vision, values, methods, and metrics—that summarizes the management method. Twice a year, there’s a memo explaining the vision for the company. What are the values that matter, and what are the methods? For example, trust, customer success—how do we measure them? And that cascades all the way to every single employee. It’s in the system, so you can measure it in real time 

http://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/discussions-on-digital-how-strategy-is-evolving-and-staying-the-same-in-the-hypergrowth-digital-age?cid=other-eml-alt-mip-mck-oth-1701