Walking through airport lounges, surfing channels in my hotel room, I’m struck by how many kung fu fights and ancient grand battles fill the screens. I suppose this is China, after all, native home of Bruce Lee and Sun Tzu.
I usually switch channels pretty quickly, hunting for some Bloomberg TV before I hit my bed, but on this scene I stop. There is a kung fu master flying through the air, showering his opponent with a flurry of fists too fast to see. The enemy, still reacting to the first strike while the second strike flies in, grows flustered and falls into the arms of his friends.
It strikes me that this is not unlike what we did all day in a conference room 26 floors below. I spent the day working with a group of technology executives developing a strategy to beat a dominant competitor out of a critical, emerging market segment. Over eight exhausting hours, we generated nearly 100 potential strategies, and from those, assembled a complex web of about 10 that we think will fluster the competition. As Sun Tzu wrote, you should set multiple traps so that if your adversary doesn’t step into one, they back up into another.
I’ve run such strategy sessions a few hundred times now, but I’ve never seen a team follow the process with such methodical patience. The outcome was lethal.
If you want to fluster your competition, you need to launch a flurry of disruptive strategies at them. Here are four steps to follow.
1. Pick four points of leverage:
Compare your business with your competitors’ across eight dimensions (the “8Ps,” as I call them in my new book): position, product, price, place, promotion, physical experience, processes, and people. For each P decide whether (a) you have an advantage, (b) your competitors have an advantage, or (c) you are evenly matched. Then pick four Ps that you think hold the greatest potential for you to surprise your competition.
2. Pick four stratagems:
You can go to my website, kaihan.net, click on the “stratagem selector,” and use this free tool to identify four strategic patterns, or stratagems, that you want to apply to your competitor. If you are not sure which to use, then use these four (which my research says are generally the most important to know now):
- Move early to the next battleground. Ask “where is the next battleground and how can we move there now?” This is like Apple creating iTunes knowing that record companies would soon need to start distributing content digitally.
- Lock up resources. Ask “what critical resources does my competitor need to compete with me and how can I increase my control over these?” This is like Apple signing exclusive agreements for the hard drives and, later, flash drives that a competitor would need to duplicate the iPod.
- Coordinate the uncoordinated. Ask “what can we coordinate to create power?” This is like Wikipedia kicking Microsoft out of the encyclopedia business by coordinating independent experts.
- Force a two-front battle. Ask “what is our core capability and how can we project that into a new market?” This is like Autodesk, the makers of AutoCAD, aiming its core capability—describing 3-D environments digitally—at unexpecting competitors. The company created Maya, the leading film animation software program.
3. Fill in the matrix:
You now have a 4x4 matrix: four “Ps” and four stratagems. Methodically fill in each cell in the matrix with three ideas. Ask, “Where is the next battleground in pricing,” “Where is the next battleground in product,” etc., then apply each stratagem to each leverage point (each P) you chose. This process will give you at least 48 ideas (4x4x3 ideas), but probably more.
4. Choose and execute:
Finally, choose the 7 to 10 ideas that are the easiest to execute and will prove most disruptive to your competition, and make them happen.
You competitor will have no idea what hit them.
If you already have my book, you can read more detailed directions in Part 4: Apply The Outthinker Process.
[Image: Flickr user huno]