For those of you who are regular followers of the Dear Strategy podcast and blog, you know that, beginning with this episode, we will be moving away from answering direct strategy questions, and moving toward discussing real-world applications of some of the concepts that we’ve been discussing here over the past 4 years. Perhaps this is a subtle change, but my hope is that, in making this change, I will have an opportunity to share more observational stories of what I’ve seen work, what I’ve seen not work, and even a few things that I haven’t seen at all but certainly wish that I had!
With all of that said, I’ll also be making a few changes to the blog portion of the podcast. In the past, every podcast episode was supported by its own separately written article. And although the articles related back to their corresponding podcast episodes, they were also designed to be used as a stand-alone resource – meaning that the blog followed the podcast, but certainly did not rely upon it.
Shifting to our new format, the plan is to make the podcast more of the central focus of Dear Strategy (which, by the way, it was always meant to be), and use the blog posts to provide a brief synopsis of the key points that were covered in each corresponding episode. In this way, the blog posts will be a bit shorter, a bit punchier, and a bit more referential back to the podcast.
So, without further ado, I give you the blog post for this month’s episode, which talks about how you can align your product strategy to your corporate strategy, and why it’s so important to alert your company’s leaders when that alignment doesn’t quite exist.
On this month’s podcast (Episode 129), I provided some tips on how to align your product strategy to your company’s overall corporate strategy. But that’s actually not quite as easy to do as it may sound!
Like it or not, most companies’ strategies tend to mimic whatever talking points happen to be popular with their customer and investor base at any given time. Currently, this includes things like providing unrivaled customer service, fostering unparalleled employee work environments, and embracing corporate sustainability initiatives that would make even the most ardent environmental activists stand up and take notice. But as noble as these initiatives may appear on the surface, the only way they can ever be truly realized is if they make their way down into the product and portfolio strategies that collectively represent not what a company says it wants to do, but what it actually does. And it’s at that critical junction where all those lofty initiatives run up against the reality of what they are actually going to cost in terms of shorter-term revenue, profit, share, or, sometimes, all three.
Let’s look at a hypothetical example. Let’s say that a company has a high-level goal to reduce its carbon footprint, and it has developed a strategy to do that through a number of initiatives including reducing factory emissions, adopting sustainability measures in the back-office environment, and building sustainable products that utilize fewer resources. Nothing to argue about there. But then we get down to the product strategies:
- Reducing factory emissions means that manufacturing costs are going to go up.
- Adopting sustainability measures in the back-office means that we should be encouraging product teams to work remotely, which could potentially cause productivity to go down.
- Building sustainable products – and I mean truly sustainable products – translates into developing products that last longer so they don’t have to be frequently disposed of. And that means revenue (especially in the short to mid-term) could be negatively affected.
The reality is that every strategy is going to come at some cost. If the strategy is sound, those costs will eventually pay dividends. But how many companies are actually willing to hedge that bet? How many companies are willing to increase costs today, not only because it’s the right thing to do, but also because it is expected to pay dividends five to ten years down the line? How many companies are willing to make sacrifices to their short-term revenue or profitability targets in order to affect real change at some point in the future?
The answer, I’m afraid, is “not many.” And that’s exactly the disconnect that I’m talking about.
So how can we reconcile this gap and attain better alignment between what leaders says they want to do at the corporate level, and what they’re actually willing to accept at the product and portfolio levels? On the podcast episode, I talk about three basic ideas that can be embraced:
- If you are a corporate leader, you need to make sure that your strategies are a) fully developed, b) fully communicated, and c) fully thought through with respect to the true impact that they are going to have on your organization’s top and bottom lines. And I would put a particular emphasis on that last one because, as I’ve said over and over again on this blog – no strategy is free. Long-term gains will absolutely come with some type of short-term sacrifice. So, if you are the type of leader who thinks you can have it all just by barking at people – er, sorry – by “pushing people to be the best that they can be” – then I’m afraid you’re really not much of a leader at all. Great leaders don’t demand goals; they support them. And that’s a lesson that you can pretty much take to the bank.
- If you are a product manager, make sure that you have a firm understanding of exactly what your corporate strategy is. Even if your leadership hasn’t fully communicated the corporate strategy, it is incumbent upon each product leader to seek out and understand the company’s overall strategic goals and initiatives so that individual product and portfolio strategies can be aligned accordingly. Said differently – the burden of understanding the corporate strategy is on the product team, not the other way around.
- Once the corporate strategy is understood, product leaders have to be ready to have honest, and sometimes difficult conversations with their leadership about what can and cannot be accomplished in relation to that strategy. And this may be the most important point to remember. Altruistic corporate strategies may make for good press, but they almost always come at a cost. And that cost may not be fully understood by the corporate leaders who develop those strategies. Yes, it is up to executive leaders to listen – but it is also up to product leaders to speak up and not commit to strategic goals and initiatives that could potentially be at odds with one another.
To learn more and to dive deeper into these points, please tune into the podcast episode by clicking on the link below.
Listen to the podcast episode
Dear Strategy: Episode 129
Are you interested in strategy workshops and skill-building classes for your product managers or business leaders? If so, please be sure to visit Strategy Generation Company by clicking the link below:
Bob Caporale is the founder of Strategy Generation Company, the author of Creative Strategy Generation and the host of the Dear Strategy podcast. You can learn more about his work by visiting bobcaporale.com.