I had breakfast with two of my ex-students from Singapore who were building a really interesting startup. They were deep into Customer Discovery and presented a ton of customer data on the validity of their initial hypothesis – target customers, pricing, stickiness, etc. I was unprepared for what they said next. “We’re going to do a big launch of our product in three weeks.” I almost dropped my coffee. “Wait a minute, what about the rest of Customer Development? Aren’t you going to validate your hypotheses by first getting some customers?”
Without any sense of irony they said, “Oh, our investors convinced us to skip that part, because our customer feedback was all over the map and our schedule showed us launching in three weeks and they were worried that we’d run out of cash. They told us to stay on schedule.” Now I was confused, and I asked, “Well what do you guys believe – Customer Development or launch on a schedule?” Without missing a beat they said, “Oh, we believe both are right.”
I realized I was listening to them treat Customer Development as an item on their
To Do list.
Suddenly, I had a massive case of déjà vu.
Can You Pull This Off
I was VP of marketing at Ardent, a supercomputer company where a year earlier I had a painful and permanent lesson about Customer Discovery. I was smart, aggressive, young and a very tactical marketer who really hadn’t a clue about what strategy actually meant.
One day the CEO called me into his office and asked, “Steve I’ve been thinking about this as our strategy going forward. What do you think?” And he proceeded to lay out a fairly complex and innovative sales and marketing strategy for our next 18 months. “Yeah, that sounds great,” I said. He nodded and then offered up, “Well what do you think of this other strategy?” I listened intently as he spun an equally complex alternative strategy. “Can you pull both of these off?” he asked looking right at me. By the angelic look on his face I should have known that I was being set up. I replied naively, “Sure, I’ll get right on it.”
Ambushed
25 years later I still remember what happened next. All of sudden the air temperature in the room dropped by about 40 degrees. Out of nowhere the CEO started screaming at me, “You stupid x?!x. These strategies are mutually exclusive. Executing both of them would put us out of business. You don’t have a clue about what the purpose of marketing is because all you are doing is executing a series of tasks like they’re like a big To Do list. Without understanding why you’re doing them, you’re dangerous as the VP of Marketing, in fact you’re just a glorified head of marketing communications.”
I left in daze angry and confused. There was no doubt my boss was a jerk, but unlike the other time I got my butt kicked, I didn’t immediately understand the point. I was a great marketer. I was getting feedback from customers, and I’d pass on every list of what customers wanted to engineering and tell them that’s the features our customers needed. I could implement any marketing plan sales handed to me regardless of how complex. In fact I was implementing three different ones. Oh…hmm… perhaps I was missing something.
I was doing a lot of marketing “things” but why was I doing them? I had approached my activities as simply as a task-list to get through. With my tail between my legs I was left to ponder; what was the function of marketing in a startup?
Strategy is Not a To Do List, It Drives a To Do List
It took me awhile, but I began to realize that the strategic part of my job was two-fold. First, (in today’s jargon) we were still searching for a scalable and repeatable business model. My job was to test our hypotheses about who were potential customers, what problems they had and what their needs were. Second, when we found these customers, marketing’s job was to put together the tactical marketing programs (ads, pr, tradeshows, white papers, data sheets) to drive end user demand into our direct sales channel and to educate our channel about how to sell our product.
Once I understood the strategy, the To Do list became clear. It allowed me to prioritize what I did, when I did it and instantly understand what would be mutually exclusive.
Good Luck and Thanks For the Fish
My students were going through the motions of Customer Development rather than understanding the purpose behind it. It was trendy, they had read my book and to them it was just another step on the list of things they had to do. They had no deep understanding of why they were doing it. So they were at a crossroads. Since their investors had asked them to launch now, what happened if their initial assumptions were wrong?
As they left I hoped they would be really lucky.
Lessons Learned
- Entrepreneurs get lots of great advice.
- Most of it is mutually exclusive.
- Don’t do it if you can’t explain why you’re doing it.
- Or else it all becomes a To Do list.
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Filed under: Ardent, Customer Development |
Thanks for sharing this story, it has been quite enlightening. I hope they got it, too: without customers how do you know what customers (really) want?
Cheers,
Ruben
Great post. I help small, artist-repreneurs learn the fundamental requirements of applying goals, strategies and tactics (in that order) to their startup businesses and, because they are always so excited about “doing” it, they have a real hard time developing the discipline to determine what their ultimately trying to achieve and why. You story is an excellent example of how not having a finish line for your efforts means you can’t ever really accomplish anything. I call this the “Hula-hoop Syndrome” – where you haven’t lost as long as you keep it spinning. (Pay no attention to the fact that you’ll never succeed doing that, either). With your permission and credit to you, I’d love to start using this story in my workshops.
jeff JOCHUM
http://startup-strategy.com
sorry, proof-read fail – their s/b they’re
Permission granted.
steve
Excellent post.
A lot of people that are thrown by the strategy thing actually make great tacticians. At the time you were chewed out, and yes the guy was a total jerk, you probably fell into that category. A good company would recognize the different skill sets and allocate positions and tasks accordingly.
Unless of course, what the boss is doing is to prepare him for the task, setting the right expectation etc.
Of course, its a rather “jerkish” way to do it, but it will be a lesson learned that is not going to be easy to forget.
I completely agree with this “Don’t do it if you can’t explain why you’re doing it.”….there has to be some useful motive.
Certainly it’s hopeless if an entrepreneur is just following a todo list…and the todo list is surely wrong because there is no thought behind it.
However, the challenge at many startups is getting things done. Getting the todo list completed is absolutely critical – basics like hiring people, fixing bugs, delivering the next set of features, etc.
This is especially true when a company is doing well. The most critical thing is getting done what we know needs to get done.
You bring up many points that require separate responses:
1) What Sun Tzu has to do with creating a marketing plan
2) Learning experiences: often painful
3) What team members are required and when
1) “Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.” –SUN TSU
Sun Tzu had it figured out thousands of years ago and his lessons are taught and ignored by MBA students every day. I continually work with very bright, highly educated clients that find it too onerous to develop a plan and too easy to rush to tactics, which are often expensive and wasteful.
Tim Calkins of the Kellogg School of Management at Northwestern crafted a methodology for creating 12-month marketing plans that is elegant in its simplicity. He’s broken the process down to 4 steps – G-O-S-T:
• GOALS: Determine from a business perspective what the company is trying to achieve over the next 12 months (market share, new markets, profitability, etc.)
• OBJECTIVES: Translate these into Specific, Measurable, Aggressive, Realistic and Time-bound objectives. Analyze the KPIs, ROIs, Customer Acquisition Costs, etc. of your offerings
• STRATEGIC INITIATIVES: Narrowly profile the key stakeholders you need to influence and then determine the strategic initiatives required to influence these stakeholders
• TACTICS: Determine the tactics required to execute each initiative and the costs associated with each tactic.
The end result of this exercise is that all marketing spends will be correlated to company Goals and Objectives. Additionally, rather than just a ‘gut-feel’, marketing budgets and spends are business decisions as opposed to emotional decisions.
We work through this process with our clients. They resist it at first but are always glad they’ve gone through it at the end.
2) Steve, while it may have been painful, you learned a valuable lesson and you obviously never forgot it. I guess one of the benefits have having grown up in the NYC Metro area is that I recognize that he was just efficiently communicating with you rather than softening the blow.
3) My guess is that Ardent was well funded. Back in the day when there weren’t many marketing choices for B2B companies it was a fairly straight-forward process for introducing a new product. Today however there are countless choices and one must first identify who the stakeholders are and then identify where and how these stakeholders get their information.
One prospective client of mine recently said, “Bill, the burdened cost of getting a good VP of Marketing in Silicon Valley is $250K/year, plus equity; and the first thing they’ll do is hire you…” Essentially, founders recruit VP’s of Marketing to act as intermediaries between the CEO, VP of Product, etc. and the agencies tasked with execution the strategy (if there is indeed a strategy.) Geoffrey Moore of “Crossing the Chasm” fame recently told me that “The VP of Marketing for a B2B start-up is a part-time job.” And he’s right. This model is broken and needs repair.
The moral of the story is carefully consider the roles you need to fill, how to fill them and when to fill them.
–Bill Ross
P.S. I’m looking forward to hearing you speak next week.
Steve, you’ve hit on a point that has been completely overrun in the valley: what is the definition of strategy? Most people define strategy as complex plan of action — you hear marketing professionals and sales professionals talking about the company strategy when in actuality they’re talking about a strategy to execute their particular domain. The definition of strategy that I like is: Strategy is creating or improving your key competitive assets. A competitive asset can be a number of things that enable you to win the marketplace: quality software, great go-to-market organization, well-known brand, etc… Figuring out what the key components are for your venture and in what combination they are required and how you can execute to a point that is difficult for others to match is the key to strategy. Once you’ve defined your assets, the To-Do list is how to build them (hire great programmers, build a great salesforce, invest in branding, etc…).
For startups, the issue is if you are really changing your strategy constantly, you are thrashing your To-Do list. If you’re just searching for the best implementation of a strategy, you’re refining the To-Do list.
But hey, I also believe in the social construction of reality…if everyone else wants to use the term incorrectly, who am I to correct them?
I define strategy as a 50,000 ft overview of how to accomplish your goals. Then the tactics and todo lists can be built to support the strategy. But you have to do a ton of work with research and discovery to figure out a great strategy that has a chance of actually working. To me, that is the Escence of custdev. It’s tricky to find the right prospects to interview. What if you’re barking up the wrong tree and everything you learn will not apply to the real marketplace? Even after up think you’ve picked a great strategy, you have to test your hypothesis about the strategy. Start with small tactics, you don’t want to waste time making a huge to do list only to have it all be a waste if the strategy turns out to be wrong. Itseems a comon thread is that funding sucks & causes founders to be forced to make mistakes. I dontwant that kind of funding. Give me visa or mastercard
the hardest lesson to apply: common sense applied to business things
Great post Steve! I used to work for an education technology startup in marketing where the VP actually believed that the only function of marketing was to execute a to-do list (tradeshows, expos, collateral etc.) and did not understand the concept of strategy or product-market fit as a gate before rushing in with heavy duty marketing communications. Since the roles were reversed, I could not convince him otherwise and had to leave.
[…] Strategy is Not a To Do List I had breakfast with two of my ex-students from Singapore who were building a really interesting startup. They were […] […]
[…] Blank’s excellent blog includes this post: Strategy is Not a To Do List, It Drives a To Do List It took me awhile, but I began to realize […]
I love this quote:
“Strategy is not a to-do list, it drives a to-do list”.
Just Tweeted it with link to the article and am quoting in my next ezine. Also relaying to some selected client contacts 🙂
Jonathan Bernstein
President
Bernstein Crisis Management, Inc.
Steve, I think you told a zillion times it’s founder/CEO job to do Customer Discovery. Why then the jerk was not doing it instead of you?
[…] Strategy is Not a To Do List via @nilofer […]
Thanks for stating these distinctions so clearly. Most of the people that I meet in business still have only ideas about tactics, and think that they are strategies.
Steve – You’ve identified a fundamental marketing truth — and one heck of a book title.
As marketers who lead business, it is our job to keep our business leaders and our companies on target by helping the business identify and answer key questions that will help us nail down the marketing strategy — which should be based on business objectives. Then it is our job to recommend the tactics that will help us execute this strategy. We should not be looking to our business leaders to develop marketing strategy — we should absolutely be recommending and leading this area of the business, serving in a consulting role within our companies.
The business should have sound faith in our experience and expertise to make sound recommendations and to execute with precision and success.
[…] Blank erinnert uns in seinem Blogpost Strategy is Not a To Do List daran, dass Strategie etwas ist, das eine ToDo-Liste antreibt, aber niemals selbst einfach nur ein […]
[…] All of which, of course, goes back to what we’re trying to do – product/market fit. Courtesy of Steve Blank… Strategy is not a To Do List. […]