 Hello Stockholm! Great to be back! Third time lucky agile people conference. So let's talk about doing strategy the thing and of course what it is in the modern way in this new landscape of lean and agile and Kinevon and things. This VUCA world that we heard in the previous talk. Of course a few experiments that we've tried and see if we can find some patterns and we can have some insights and some learnings from these experiments. And this is speed talk so let's proceed with speed. So the story I will sort of try to convey is from strategy as chess. You know you have a grand chess master, you have set rules, fixed pieces and the chess board and you know quite slow game where someone is making all the moves and the pawns and the pieces on the chess board. They're just sort of executing what's the big brain has come up with. So let's move away from that and let's look at strategy as football. You know very fluid fast game with you know people who collaborate they play together and they win together and they lose together and they have their own individual moves based on an overall mission or purpose for their team. So that's a metaphor that I would like us to explore the coming few minutes. Okay so my name is Erik Høen. I happen to play football so that's why I like this metaphor and I worked at a few cool companies, Netent the online gaming company, Ericsson the Big Telco and Framfab, anyone remembers Framfab? Yeah from three to three thousand people in three years and then we crashed and burned. Something of an experience. Did we have a strategy? Yes we did. Why strategy? Well you know you heard the previous speaker talking about this Vuka world volatile uncertain complex and ambiguous and it was Vuka already in 18 something when when Hokusai the Japanese woodblock painter made this freak wave. So there's been things going on all throughout history but what is happening now with a digital thing that we are all aware of is that things go by three orders of magnitude higher speed. It's a factor one thousand with bits traveling much faster than atoms. So that's the big difference I would say. So then of course we need a strategy. We need to have an idea of where we're going and the direction and what choices we make to sustainably thrive in this world where the rate of change is never slower than today. What is strategy? I'm not going to ask you I'm going to answer because this is speed talk. So this is a brilliant lady called Melissa Perry and I really like this definition because it's totally in line with with what we have learned you know lean and agile and and Kinevin and all these things. So strategy it's a system you know achievable goals missions working together a line of team around desirable outcomes both for customers and the business and it emerges from experiments towards a goal or in a certain direction. So I think this is a very good modern working definition of what strategy is. So how do you do this? This could be seen as a very abstract right? How do you do it? Enough with definitions and theory let's get down to business right? How do you do it in a real business context? Who's this? Jack Welsh. Some people say he's the best CEO of the 20th century and let's hear from Jack. Real life strategy is very simple. General direction implement like hell. Would you agree? Is it that simple? Let's let's move on. Oh who's this guy? Another old gentleman. It's Dr. Deming the quality guru who inspired the Japanese industry and the second half of the 20th century and you know he's on the line and he looks pretty upset. Dr. Deming what's on your mind? I have only three words for you. By what method? And I guess he was talking to Jack here on this two-party call. Of course we need a method so thanks for the reminder Dr. Deming. We got a three-party call. Dr. Evil is on the line. What would you like to add? Nothing. Absolutely nothing. The strategy is top secret. Just do what I tell you. Anyone recognize that situation? Maybe not as extreme you know Dr. Evil and so on but I think in a lot of companies tend to forget that it's so important with the trust and collaboration primarily between the business side of things and the development side of things to working together with trust and collaboration. It's crucially important. So yeah top secret strategy just do what I tell you. Don't go there. Don't follow Dr. Evil. So how do you develop your strategy? How do you do that? How do you co-create a strategy that is valid? Let's explore that for a while. So this is an experiment you know talking about direction talking about end point you know needs long-term key performance indications. So what are our needs? So this is you know just setting the direction. More value to exceed customer expectations. Faster time to market to be more responsive. Better quality to secure trust. 75% engage people as the foundation. So this was a long-term thing. It was set five years into the future and this was pretty pretty cool actually and the key learnings for this was it was so good to have a stable long-term KBI or key performance indicators. Not having a fluffy long-term vision making it concrete and having it stable gives a lot of clarity and a lot of focus. It was ambitious you know 10 times 4 times 2 times so we realized we needed to do something radically different. It was balanced to secure that we avoided sub-optimization you know lead time at all costs sacrificing quality for instance and it was also really good and easy to show progress towards these quantified measures to give us energy to continue on the journey and of course show our stakeholders that we were making some progress but it was not the next quarter it was not the next month or even the next year it was coming five years and we actually did achieve those targets so I think it's good to start with the needs and setting direction or vision. Then another experiment finding you know a metaphor a simple iterative incremental way of doing or setting up your strategy as iterative choices so this is called playing to win it's a sports metaphor and people relate to sport much more easily than to military or war and stuff so here you talk about your winning proposition we're in this to win the hearts and minds of our customers how are we going to do that then you make choices where are we going to play what's the playing field are we going to play handball or football or ice hockey what choices do we make here based on those choices of where to play how are we going to win it's outside in starting from customers starting from the winning proposition what's the playing field how are we going to play there what choices do we make so strategy is about making choices what do we gonna what are we going to do and what are we not going to do super important and framing it in this sports metaphor helps a lot so based on where to play how to win then what capabilities do we need what capabilities do we have what capabilities do we need to build so this is iterative it's not linear so you go back and forth and you iterate and you learn when you do this and final step what kind of enabling structures you know what kind of systems and measures do we need for you know making this happens so the learnings here was that sports is a very useful metaphor people can relate to this and it really works on all levels talking about fractal things you know it works on individual level it works on team level it works on program level it works on organizational level so that's really cool and we got a very focused description of our strategy you know it could be written on five slides one for each of these areas not 50 pages of boring word or power points that was pretty cool moving on you know another experiment visualize your value offering so this fish bowl is should be red it's a red ocean a lot of fish that are eating each other and then you know we want to move want to fly to the next blue ocean so this is sort of blue ocean strategy where you want to find a brilliant spot where you sort of differentiate and you make yourself unique and how do you do that well use the storytelling of course like this having nice visualizations but you can also have this simple graph where on the horizontal sorry vertical axis you have your offering level is it high like five or low one say and on the the horizontal axis you pick a number of competing factors that are important for your industry or for your market and then you just plot you know in blue you plot yourself and in red you plot one or several of your competitors and the key thing here is of course that it triggers a conversation because all those hidden assumptions that people may have on what makes us unique and what is good for competition you put them out on on on a whiteboard it's you shouldn't really do this on a power point but you should be a number of people gathering around the whiteboard and do this together as a collaborative co-creative exercise so many insights on what you will do and what decisions and actions to take based on this common understanding when you plot this and of course it's hard to find those competing factors that's hard and it's sometimes hard to know exactly what your competitors are doing and how you are doing but that's a trigger for going out and getting data and having conversations with customers potentially as well okay another visualization and I'm not going to go through the details but this is also very very good to trigger conversations you know visualizing your value chain and how it evolves so you have a value chain you start with the customer at the top and the customer in this case needs you know play games console or mobile gaming pc mac or on a virtual reality headset then you can sort of follow those needs and capabilities that are needed to to build those needs via you know your game platform all the way down to power you know plug it in to the wall to get power so that's a chain of needs on the other axis you have sort of evolution from uncharted to industrialized you have some kind of genesis totally creative thing custom built product or commodity so once again this tool which is it's a tool but it triggers the conversations so you can agree on how your product or your service looks like so you shouldn't have a powerpoint once again you should be at the whiteboard drawing this together and having the conversation to get the insights on what are those needs then of course you can start making decisions on okay should we do this ourselves if it's a commodity well of course we don't build the power if it's a product should we buy it or should we build it or should we outsource the development to someone else so this is an extremely cool visualization that will help you to make those hard choices make those decisions and come up with your strategy by drawing it together starting from the customer taking it all the way down to to power and then you know get those consent decisions in a much quicker way because you're co-creating this picture and by doing that you get those hidden assumptions and those hidden insights because some people are very intuitive but you get it sort of up on the whiteboard it takes a lot of practice i can tell you that takes a lot of iteration takes some time those are the sort of negative learnings just to be open with that but it's so useful totally useful okay moving on how do you make your strategy happen and of course as this murbios strip shows it's it's related it's really two sides the same coin how do you develop your strategy and how do you make it happen it's yin and yang it's not you know you do one thing separately from the other but i think this is really really important this alignment and autonomy you may think that they are separate concept either you have total alignment or you have total autonomy but it's not it's not binary it's not either or you can have both so if you plot alignment on the intent the what and why on the vertical axis and you plot autonomy on the horizontal axis that's the actions the decisions the how so by co-creating alignment or coherence on the what and why you're going to do the principles then you can create a lot of freedom on the actions the decisions and and how to do things the methods or the tools so strong alignment gives you you the possibility to have a maximum autonomy and then that helps everyone in the organization to take the right action and to take the right decisions so you enable a lot of freedom and we all know freedom and autonomy through Dan Pink's work is super important but you also need some kind of alignment you want to direct the energy in a in a certain direction that's also very very important and that's should be coherent and it should be co-created so so this was an insight in our way of making strategy happening so long lead time from insights to action so we had those strategy updates in in q1 then we did some balance scorecard in q3 and then you updated the balance scorecard in q4 and then three quarters later you started reporting on those targets and well were they still valid because you know the rate of change will never be slower than today but this is where we started and it was terrible so the the rapidly changing world meant that our targets were quickly outdated so instead we did regular strategy retrospectives and that's you know quarterly you sit down together and involve the whole organization um by you know looking at our long-term key performance indicators looking at the current business situation looking at the current challenge and the current strategy and what we have learned from that and the the ongoing experiments and then you know setting a new challenge because a challenge is something that sort of triggers the whole organization to do experiments trials prototypes to improve and get better so you want to tap into the creative energy of the whole organization and that will take you to where your long-term key performance indicators so the learnings from this experiment was that it was really good to have this regular and positive reinforcement of of our strategy and of the the long-term wanted position and it was much faster of course to move from insights to action we had sort of a quarterly cycle and the progress was made visible on a quarterly basis so people could see that we were making much more progress and i don't have this on the slides but we actually took it down even to to sprints so we had three-week sprints so we had sort of strategy sessions every sprint not only every quarter sort of to to sort of help us with the experiments and and see how we were doing to make the strategy happening so it can be done and it's all about the cadence you go from yearly cadence down to quarters or even to sprints also for your strategy okay so this is a bit more on on how we did this so dig it a bit deeper so we had a challenge which is sort of one thing and this case it was every sprint delivered to a live network a live mobile telecom network and we had our our business leadership team and our development leadership team agreeing on this as a first step then we engaged the whole organization in half-day exercises half-day team exercise okay what are we going to do to contribute to making this happen we also said that you have 30 percent everyone has 30 percent to do experiments their most prototypes learning at their disposal to make this happen so this is what lin gurus called push the forum and pull the content so you give some some direction and you give the what and why and then you give autonomy on how to do it and the learnings here were really that it was good to have clear expectations but it was a bit hard to get bigger things to happen still with this okay final experiment sort of a simple operating system for making your strategy happen this called four disciplines of execution and don't care so much about the words discipline execution because this is really cool actually first thing is focus focus on the most important thing pick one maximum two things and this we we've learned from you know flow and kanban it's limit your your working programs or process this is really limiting the number of of targets you're working on next thing is act on your lead measures and this is something we've learned from startups and an even lean startup you shouldn't only you know look at the measure gloss what happened when it had rained but you need to look at your lead measures your your barometer to see where you're heading because otherwise you're always chasing the rabbit you're always after the rabbit because you measure when things are done so find your lead measures very early on and see how they relate to to your focused lag targets okay so that was number two number three compelling scoreboard once again a visualization and this is a compelling scoreboard for the team by the team it's not for for for managers or for other teams it's really to the team to show are we winning are we losing are we drawing how are our lead measures going how are the lag measures going so it should be done by the team and it could be a bit fun some metaphor some teams use lego and that's that's always cool and finally you create a cadence of accountability and this is similar to what we know from scrum you know daily stand up that's a good thing you create a sort of a cadence a habit and here it's at least weekly where you talk about commitments this is what i'm going to do this is what i've done this is psychology it's not commitment to your manager it's commitment to your mates your your colleagues in the team and of course it's about learning what did i learn from last year how did sort of for last week how did the did what i did contribute to the the lead measures and the lag measures so this experiment was also really really cool but it what we learned was that it's if you do all the four things then you get the the results then you get the outcomes if you start missing out on having this this cadence if you start doing every second week then you start to forget and then it's get boring so i think this that's another learning that that we saw so really go all in to all four and start from there that was the key key success factor and the teams that didn't they started to degrade okay so to wrap this up what were the sort of patterns that that we saw in these simple experiments and those learnings well visualization compelling scoreboards having those strategy canvases having this worldly map where you see the needs and that triggers a conversation which triggers collaboration so you involve people and you interact also the the alignment or to get the coherence how to co-create that and to get feedback loops quickly and uh you know get then the autonomy for people so the combination of alignment for autonomy so final question how do you want to do strategy thank you thank you eric