"Complex problems do not always need complex solutions." Many of the problems we consider to be complex only ever need us to scratch further down the surface.
In the business world, it is not uncommon to find leaders who go the extra mile while shaping their strategy. But history (and the present) has proven that less is often more. In this article, we discuss the benefits to be found in simplifying your strategy. We'll also show you how to do it.
What is it?
As its name suggests, the concept of "strategy as simple rules" revolves around simplifying business strategies. It seeks to remove the complex nature of strategy formulation so that execution becomes easier and goals are achieved faster.
"Simple rules help us focus our attention on the things that matter most, saving us time and effort."
In their book "Strategy as simple Rules," Kathleen M. Eisenhardt and Donald Sull state that strategies become simpler in response to businesses becoming more complicated. They recommend that strategy be crafted out of a set of rules. This is averse to traditional strategy formulation, where we have many levers to be pulled across the organizational value chain.
For the strategy to be simplified, it must comprise rules with certain qualities. The rules must be explicit, time-sensitive, and logical. They must also establish a scale of priority and cover alternative use cases.
When do we use it?
Business leaders, managers, and others responsible for strategy formulation have found beneficial uses for simplifying their strategies. They include:
In developing core competencies
The freedom to explore new possibilities and use new techniques can only be afforded in an unconstrained work environment. By simplifying your rules, you can give your team the liberty to exert themselves more.
For better decision-making
You'll not always have all the time and information needed to make decisions on the go. But if you have a strategy built on simple rules, it becomes easier to make the right decisions. You don't have to think too much about the bureaucratic bottlenecks.
To create competitive advantages
Simple rules make it easier to meet targets, deploy resources, execute strategy, and create a better customer experience. It gives room for people to express themselves and leverage their capabilities.
To explore new possibilities
Some managers create hedges around their strategy framework, thus making it difficult to break new ground effectively. The "strategy as simple rule" method does the opposite. Its flexible boundary rules can allow your business to flow into any new prospects and adapt as required.
What business questions is it helping us to answer?
The " Strategy as simple rules" model comprises simplified rules that address certain business arguments, as shown below.
The what questions
The answers to these questions can help you decongest your work table to focus on your biggest issues.
What are our goals and major objectives?
What tasks or targets are critical, and what capabilities must be leveraged on these tasks?
What course of action can yield the desired impact?
The How-To questions
The main questions pertain to the processes, methods, and actions taken to fulfill your objectives.
How can we achieve our goals and actualize our strategic vision?
How can we deploy and coordinate our efforts, skills, and resources to achieve these goals?
The Do/Don't questions
The questions here are: what will you do and what will you not do to achieve your targets?
And while they appear pretty basic, these questions can help you save a lot of time and effort. This method can help you lay out your plans in clear terms and clear all the debris on your path to achieving them.
How do we use it?
Below are a few guidelines to help you simplify the rules associated with your business strategy.
Define the objective
Your objective must offer a clear lead and glimpse into your goals. It must be simple, specific, and measurable. You can include these objectives in your strategy draft.
Identify the bottlenecks
The bottlenecks include those challenges that can prevent your objectives from being fulfilled. They can come from internal and external sources. You'll have to create a plan to mitigate these challenges in your strategy.
Craft the rules
After itemizing your objectives and the challenges ahead, you can create the rules to guide your business strategy. Here are a few tips for creating your rules.
Let the rules be "Simple," logical, and well-defined
Use between 3-7 rules per defined activity.
Let the rules come with alternatives.
Let the rules have an execution timeframe.
Practical Example
Think of the biggest names in the business world and how they've grown their enterprise without blowing off rocket fire. Think of Amazon and its focus on providing the ultimate customer experience.
As one of the world's biggest retailers(some folks say it is the biggest), Amazon still manages to meet its customer's needs. It has built a massive ecosystem of services around affiliate enterprises. They only need to draw you in once, and you'll find every other thing you're looking for.
Advantages
It can save time spent in strategy execution
You can shorten the journey to achieving real change in your business by removing some of the barriers in your strategy roadmap. If your strategy blueprint has too many blurred lines (or rules), it can confuse the people charged with executing it.
It simplifies the goals and the communication process
Setting too many goals can put undue pressure on your staff at best and render them helpless at worst. The solution is quite simple. Sum up those goals and objectives with similar blueprints. It'll be easier to process at first glance and execute.
It creates room for improvement
People can sometimes be held back by the complex rules and processes laid out to follow in the workplace. Give your workers the freedom to express themselves and cut back on the red tape.
It helps businesses adapt to fast-changing market conditions
Today's market conditions are becoming increasingly dynamic. And it is only by being flexible that you can thrive under such conditions. Using simple rules to define your strategy means you'll not need any serious reshuffling in reaction to the market flux.
Disadvantages
There is an inherent risk of missing out on key issues
Oversimplifying your operational strategy can often come with the risk of omitting key issues. You don't want to leave out crucial work details all in a bid to simplify the process. Hence, the need for thorough introspection while using this strategy.
The simplification process is not always straightforward
Some companies have so much organizational clutter that it'll take some time to dispose of. You'll have to find ways to capture the key message and lay them out in clear, practical terms. And this is no easy task.
Continue to explore strategy tools here.
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