 We hear all the time something like, innovate or die, change or die, and then at some point looking back to my history of life and seeing all the challenges in some parts of the world and saying, is it responsible for you squeezing the wrong business forever and end up going bankruptcy, making hundreds of people losing their jobs not paying your tax, this is a massive value destruction. So we need to understand also when it's time to change and to move. And our next talk is exactly about your execution needs a strategy. So we are trying to walk on this bridge in different ways and to present that I want to invite back to the stage Martin Reeves, the director of BCG Henderson Institute. Martin, floor is yours. Thank you. So it's a beautiful ballroom, nice historic room we're in but it's also a very nice sunny day outside. So let's go for a walk together. We're going to go for a walk in the highlands of strategy and our objective is to scale the peak to B, this point which is higher than the low point A where we're currently standing. We like business strategy but we spend a lot of time being realistic today saying well basically the beautifully constructed plans don't always go according to plan. We may set off in the wrong direction, we may get lost in the woods, we may hit swampy ground that we didn't anticipate, we may not have packed enough resources for the journey. So really I'd like to delve using a hiking analogy what can go wrong during implementation. And I think it's a very real problem. I can't give you a number in general but I can say that about 75% of large-scale change programs, transformations, fail to meet their initial objective. So this is probably the biggest strategy problem we have, the fact that our strategists tend not to work in practice. So what do we mean by change and implementation? For me it conjures up images of a Gantt chart, a project management office, a project manager and goals that are specific and measurable and attainable and relevant and timely. Sounds very disciplined, sounds very systematic but my contention actually is that the machinery of project management may actually be in some cases part of the problem. But let's go hiking again and let's think about what some good tactics would be for negotiating the different types of terrain that we actually might encounter on the way to our strategic peak. So let's start off with the most straightforward example. Imagine it's a beautiful sunny day today. There's nothing obscuring our view so not only can we see the goal, the peak, but we can actually see every step of the way. So we can use what I call a planned itinerary approach which is a traditional project management approach. We can actually say we're going to go to A, A dash, B dash and we're going to plan every step of the way and then we're going to execute against that plan. And I think we mustn't overdo our stereotyping of planning. Planning sometimes work. Staple's a few years back had a project to take out $250 million of costs so the goal was clear and it knew that it needed to get those costs by renegotiating its supply contracts with vendors and it proceeded to do so and attained with a very high degree of predictability the the goal that it set out to achieve and they may even have said that was easy after they did it because it was a fairly straightforward exercise in project management. But of course it's not always so easy. Imagine that we're crossing a river. We certainly have a clear end in mind which is to reach the other side but we can't necessarily see the stones beneath the water. We may have to feel our way a deviate from a straight line to cross the river adapting as we go. Alex referred to this sort of change a lot, river crossing and of course this is very common in business nowadays. When Starbucks a few years back set out to increase its loyalty, custom loyalty by making it stores the centre of the neighbourhoods, the goal was pretty clear, loyalty and becoming a centre of each community that the shop was in. But really they had a limited conception of exactly how to do that. Finding out how to do that involved a lot of experimentation with social media and other levers and they eventually found the goal by a path which they didn't anticipate. No ganchards there. Let's look at the third of the five types of terrain we're going to look at. Anyone that has climbed a mountain in a temperate climate knows that you can't see the peak until you clear the tree line and so first you have to pass through some woods. So unclear goal, you have no direct sight of the goal but your legs will tell you or your eyes will tell you whether you're heading upwards or not. So really the question is, are we heading upwards? Hill climbing. Having some trouble with the technology today. It's a little like John Deere. John Deere is trying to put internet of things technology around its products so sensors, information, services. It actually knows that it doesn't have the end state of the IoT ecosystem in mind because it doesn't have one yet. Its industry doesn't have that reality yet. But what it does know is whether every service that it tests makes things better or worse. Profitable or unprofitable. Better customer satisfaction or worse customer satisfaction. So really it is iterating a step at a time. No ganchard here either. Terrain number four. Counterintuitive as it may seem. Sometimes having no strategy is actually the best strategy. Imagine that we're stuck in the middle of nowhere in an unfamiliar landscape with no map. Actually our best bet may be to scout and wander and gain familiarity with the landscape before we construct a more precise plan. And of course scouting and wandering is a perfectly precedented strategy for companies that are investigating new spaces. As with Google and some of its early stage moonshots for example. The last terrain I want to look at is if you get stuck in the swamp. About a third of companies at any given time in the last decade have experienced double digit total share of return declines from multi-year period. And many of them launch into what is usually called a transformation program. So really it's a business of trying to escape from their predicament before they hemorrhage cash and become unviable as a company. If you're stuck in a swamp your best bet is probably to temporarily forget about the eventual goal and focus on rapid and pragmatic steps to stop you from sinking into the mud. And there are really lots of examples of this. I picked Best Buy just because of some of the graphic statements that the CEO of the time made. So the CEO of the time of Best Buy's last transformation said if you try and ride a bicycle standing still you'll fall off. The meaning that sometimes there's no time for elaborate planning for the deduction of the best plan. Sometimes rapid pragmatic action to escape the current predicament is what it's all about. So what am I saying by laying out these many journeys? What I'm saying is that we shouldn't speak of change in the singular. We should really look at the particular type of change that we're bringing about. We should think about the clarity of ends and we should think about the clarity of means and we should adapt our strategies accordingly. And that's really important because what we actually do will depend upon what our strategy of change is. So if we're doing river crossing then it's all about iterative experimentation towards a defined goal and we need in this case we need we need decentralized action. We need to eliminate fairer failure. We need to measure what's working and what's not working. We need very fluid resource allocation and so on. In the case of hill climbing which superficially may seem quite similar because it also involves experimentation. Really it's an entirely different logic. It's not a logic of our experiments helping us proceed towards a known goal. It's more a logic of what is the effect of the last thing I did. Now of course this is a little bit of a simplification because any real hiking journey has to traverse probably all of or multiple terrains and so any transformation journey of a corporation also has to pass through many stages. We may need to fix something before we pivot to growth. We may need to envision something which the world has not seen yet and then adaptively figure out how that works. We may need to search an unexplored space and then adaptively change our tactics before the space matures and we can adopt a more classical plan and nowadays especially in anything to do with technology we may need actually to cycle through these strategies to continuously adapt because we never reach the steady state. We never reach the bottom of the learning curve because disruption puts us on another learning curve before we finish the current one. So this fantasy that we've had while hiking, what can it tell us about change management and implementation? I think it can tell us that change is not one thing. There are many species of change who really should use more precise words. I think it tells us that there's no such thing as strategy and implementation. Implementation needs strategic thinking. We need an implementation approach which reflects the challenge at hand. What we do varies accordingly. If we're addicted to PMO and Gantt chart maybe we need to diversify our tactics. We should de-average our programs. That's unlikely for a large corporation with a large trade change program to be one answer to the challenge at hand. We should divide it into pieces and employ the right strategy. In case you think I've got something about Gantt charts don't throw away your Gantt charts. They're actually very useful under certain circumstances but my strong message is unfortunately it's inconvenient because life's more complicated. Unfortunately they're no longer a panacea though.