Inside-out or outside-in? A strategy warmup

In case you have been wondering why it has been quieter than usual here, we had four night’s worth of respite break last week (long story but it was great, the longest break we’ve had since the pandemic started). Refreshed and energised, by the power of Zoom I was in New Zealand early in the morning of my first day back for a Limited WIP Society meetup and I thought it would be fun to try an experiment.

As per most of my meetup appearances we did a IdOO (“I do”) pattern exercise, three breakouts discussing the Ideal, Obstacles, and Outcomes for a given challenge. Composed for the event, here’s the challenge we used:

Imagine…

…reaching the right customers, meeting their strategic needs*, achieving results in the way to which we aspire

*strategic needs: their needs, our strategy

(And here is that challenge plugged into the IdOO Breakout Generator announced last month)

There are several things going on that challenge, and I was careful not to steer people towards any particular element. In the debrief afterwards:

To which part did you most respond? Right customers and their strategic needs, or how we achieve them? If right customers and their strategic needs, chat “outside-in”. If you responded mainly to the how part, “inside-out.

Interestingly, the split was roughly 50:50.

Inside-out and outside-in describe two important and complementary approaches to strategy. If you start with developing capability, performance, or culture, it’s inside-out. Whether or not it qualifies as effective strategy depends on a few things: if you identify one or more meaningful objectives (not too many of those – you need focus), some measures of success (how to know that you’re winning), the most important obstacles you’ll likely need to overcome (no point focussing on the wrong obstacles or obstacles that don’t really exist), and other sources of uncertainty (be honest now), you’ve made a good start, but still you’re set up for failure if you can’t back that up with the necessary commitments.

You can get all of that right and still waste a lot of time finding out that it’s all completely irrelevant from the customer’s perspective – a potentially catastrophic problem if left unaddressed. The alternative? Outside-in means starting from the customer and other actors in the changing business environment, and working inwards. In the process, it creates meaning and context for what happens inside, a powerful exercise in alignment when done right.

Don’t get me wrong, organisations absolutely need to balance both perspectives, and it’s good to be skilled in facilitating both approaches. It’s good also to know which one you’re doing, and to recognise when the other is what’s needed or is happening anyway (trust me, it happens, and it can be a good thing).

If you know you have an urgent need to look at things from both ends, my firm advice is to start outside-in. With the right kind of structure you’ll get quickly to a point where you can bounce back out again, and the whole exercise will make so much more sense. Agreeing instead on a load of improvement work that later turns out to be irrelevant is at best wasteful, and at worst, demoralising.

Back from my break I have started recording Outside-in Strategy with Outcomes, the outside-in complement to the self-paced training Leading with Outcomes with which we launched the Agendashift Academy last month. Together with our signature interactive workshops – see Upcoming below for dates – we’re building a comprehensive training programme, all designed to help organisations, their leaders, and their expert practitioners thrive together in a changing environment. For us that means some motivating objectives for the year consistent with our mission, and some new capabilities to develop. And don’t worry, no shortage of commitment!

The IdOO pattern as leadership model (May)
What do I mean by ‘generative pattern’? (May)
Towards the wholehearted organisation, outside in (May 2018)

Resources (agendashift.com/resources)

What if we put agreement on outcomes ahead of solutions?

Agendashift

Share this:

Like this: