All opportunities have uncertainty. Use a map to navigate it.
The past two years were as disruptive as they get for both society and business. So how do you plan for the next year when the past two were so uncertain?
Success today requires hedging bets, keeping your options open, and constantly pivoting. Forget 10-year visions. Forget five-year road maps. Forget three-year plans. Long-term is a year. Short-term is a month.
Some people think being agile is a mindset. Other think it’s an innate leadership skill. If you have the right tools, anyone can both build agility into how you think and make it the foundation of your business processes. The goal is to create the capacity for resilience, no matter what’s thrown at you.
A Strategy Uncertainty Map is a visual representation of your top opportunities, which can include products, services, projects, or business strategies. It’s not just a list. It’s a map, organized by the level of uncertainty of the external environment along with the internal capabilities needed to successfully implement your opportunities. For example, when you assess your projects on the basis of your uncertainty in these two areas, you get a relative view of which projects carry the most risk so you can invest more wisely.
Assess each of your opportunities using two categories: External Environment and Internal Capabilities. For each of these two categories, determine up to three specific variables that are the most important success criteria for your organization. First do it for the External Environment. The success criteria for the external environment might include customer acceptance, competitive differentiation, market trends, or anything else external to your organization that you don’t control. Then, identify the success criteria related to the Internal Capabilities you would need to create or leverage as you implement your opportunities, like having the right talent on your team and technology, and building a winning business model.
Here’s an example of what this could look like if you have a product portfolio and want to evaluate your options for taking the best products forward. For each of your products, score the variables from 1 (low certainty) to 5 (high certainty).
- Customers — How certain are we that customers will want the product?
- Competitors — How certain are we that the product is differentiated from the competition?
- Industry Trends — How certain are we that external trends will help create and grow the market for the product?
- People and Talent — How certain are we that we have the right talent to develop, market, and sell the product?
- Technology — How certain are we that we have the right technologies for the product?
- Business Model — How certain are we that we understand and have defined the winning business model for the product?
When you score each variable on a scale of 1 to 5, the highest score a product could receive would be 15 within either of the categories (unless you decide to weight the variables, which is the case in the Excel file link provided above). A score of 30 would mean you have complete certainty that all the success factors are in place externally and internally for that specific product. On the flip side, a low certainty score would mean that significant uncertainty exists for that product’s success, which also equates to a lot of risk.
Here’s the best way to use the Strategy Uncertainty Map:
- Get a team to define the variables that will be your success criteria
- Discuss whatever data you have, and score each of your opportunities on the criteria
- Tally the scores and map opportunities on a matrix or chart using online software, a spreadsheet, or a presentation slide
Once you have your map, choose the opportunities that you will pursue. You might want to select of mix of low-risk and high-risk projects so you can hedge bets. Also, be sure to keep the Strategy Uncertainty Map alive. Don’t do the activity and then wait a year to see how you’re doing. Revisit the map, rescore your opportunities, and reevaluate your projects regularly. That’s how you remain resilient in today’s disruptive world.
This article was originally published on Inc.com and has been syndicated for this blog.
Soren Kaplan is the best-selling and award-winning author of Leapfrogging and The Invisible Advantage, an affiliate at USC’s Center for Effective Organizations, a columnist for Inc. Magazine, a leading keynote speaker and the founder of Praxie.com. Business Insider and the Thinkers50 have named him one of the world’s top management experts and consultants.