Tuesday, September 21, 2010

What in the world is the "Strategy Pitch Equation"?

One of my friends who had paid a closer attention to the cartoons within one of our earlier blogs – jokingly said –“don’t stretch him any longer ... he is going to break apart”. With all the pun aside - as I thought more about it –the character within the cartoon is being stretched for a reason i.e. to reach the optimal length with the appropriate tension- so that he/she can pitch the purpose-profit balanced strategy for a maximum business outcome - very much like how a guitarist tunes his/her strings (by balancing the length and tension) artfully for bringing the maximum harmonious pitch to our ears.

C.K. Prahalad and Gary Hamel would argue that "creating stretch, a misfit between resources and aspirations, is the single most important task senior management faces" – which makes me to propose a hypothesis - that the stretch/causal analysis is the single most strategic activity within an organization, given the fact, that the number of resources (length) and their aspirations (tension) have a direct co-relation to the effective implementation of the strategy causal chain. Hence, aligning the length and tension of the strategy causal chain/string is the single most prerequisite task of the pitch masters to pitch or execute their strategies effectively.

A quick musical instrument primer would be appropriate here to move forward with our hypothesis – i.e. arriving at the optimum length along with the appropriate tension of the string are the two most important challenges for the stringed musical instrument designers to achieve the desired pitch level as outlined in the musical pitch equation below.

P=1/2L (T/m) 1/2

P= pitch frequency
L= length of the string
T= tension of the string
m= mass per unit string length

Now that we have understood the “what part” of the musical pitch equation, one can easily extend this equation to the business strategy pitch context as well- i.e. equating resources to the length of the string and aspiration to tension within the context of maximizing the strategy pitch outcome or the so called, competitive advantage . While the “what part” of the stretch/causal analysis will help us to “get even” with our competition, the “why/how part” of the analysis is what help us to create, the so called, competitive advantage to march ahead of our competition. To arrive at this “why/how part” of our analysis- we may have to revisit our strategy causal chain/string analogy, one more time, for some more inspiration.

As we dissect the variables within this musical pitch equation, we can clearly see a pattern evolving - when we keep the string's length constant, we need a higher mass “per unit string” to generate the appropriate amount of tension, which then, producing the desired pitch. On the other hand, if we keep the string's mass “per unit length” as constant, we need a longer length of string to generate the same tension, which then, producing the desired pitch.

Similarly, when we keep the number of resources constant (due to capital constraints), the talent “per unit resource” needs to be elevated higher to generate the right amount of aspiration needed to produce the desired strategic pitch outcome. For some reason, If we have to keep the talent “per unit resource” as constant (due to the lack of talented resources), we will, then need, more number of resources to generate the same amount of aspiration level, thereby achieving the same desired pitch effect - as outlined in the strategy pitch equation below.

P=1/2R (A/t) 1/2

P= strategy pitch execution frequency
R= resources of the strategy causal chain
A= aspirations of the strategy causal chain
t= talent per unit resource

As we can clearly see in this equation – it is not only strategist dilemma to balance the resource and aspiration dimensions of the strategy pitch equation for a maximum outcome, it is also the leadership dilemma to arrive at the right number of resources (with appropriate talent) with appropriate aspirations for the strategy to be pitched/executed effectively for a maximum business outcome. The next obvious question is -how can organizations with limited resources can achieve superior strategy pitch/execution performance within the context of this strategy pitch equation?
  • “Stretch” the aspirations of the resources to generate the optimum tension within the strategy causal chain/string.
  • “Leverage/Maximize” the talents of resources (or hire talented resources) to achieve the optimum length within the strategy causal chain/string.
  • Execute” the strategy with laser focus vigor to achieve this optimum pitch by balancing the variables of the strategy pitch equation.

1 comment:

  1. Hello Charles,

    With your talent that equation may become irrelevant.. In you, we have an overflow of talents (many talents in one) and so the talent-scarcity is no problem. We may stretch the talent part generously before tunning into the optimization issue.

    Honestly, this is a lovely post. I do not want to "over-stretch" my appreciation of it