Your marketing strategy needs attention now! Especially THE WAY you develop it.

The current Corona crisis forces many companies to redefine themselves to become more essential to their customers. Now is the time to be more disruptive than before. Now is the time to help people through the crisis and be more relevant after the pandemic. Given the current burning platform and the exponential rate of change we’re up against, this requires a whole new way of developing strategies.

The development of marketing strategy has traditionally been a top-down, mostly annual exercise. It is designed as a thoughtful multi-stakeholder process and based on careful deliberation based on a maximum amount of information. In many large, traditional corporations, strategy development is still the exclusive domain of the strategy department, supporting the C-suite and senior management. But this way of working may  no longer fit present very volatile, uncertain, complex, ambiguous times. 

(Marketing) strategy is fundamentally about fit: How organizations adapt to their changing environment. It involves plans to achieve well-defined objectives by creating value that the customers are willing to pay for and capture a significant part of this value to the company.

So strategy is all about creating value propositions by anticipating external circumstances and trends. External circumstances that are subject to exponential change. As the need for agility and local knowledge in strategy increases, a broader involvement of employees  within the organization is required. Local knowledge and insights means involvement of marketing teams in the countries or regions. Agility requires a way of working that breaks down the traditional silos of strategy development and execution. And last but not least, the quality of testing and execution of strategy has become instrumental to the success rate of a strategy.

So nowadays, strategy that delivers superior and sustainable performance requires many (layers of) employees working together as peers. Hence I call this way-of-working peer-to-peer strategy development. Now is the moment to make strategy development more democratic than it was before. This article outlines the key components of what this more inclusive strategy development could look like in 2020 and beyond, allowing us to react with great agility to our challenging world. Peer-to-peer strategy development consists of 5 essential components, abbreviated to P-E-E-E-R:

1.     Purpose

2.     Experimentation

3.     Execution

4.     Education

5.     Repetition

Each of these components are described below.

1. Purpose

The basic condition for democratic strategy development to work is that there should be an inspiring starting point that provides a strong fundament. Offering basic stability is key. This helps developing an overall aligned sense of direction and generates an shared understanding of the impact the company wants to make on all stakeholders and the world around them. The best companies will be those that treat their customers and employees with respect and kindness. Businesses must serve all their stakeholders well, but customers, employees and local communities should come first— and the owners last. This Corona crisis has produced some great examples of businesses showing their true face.

The Dutch brewer Bavaria has emptied the tanks with unsold beer at their Dutch hotel and catering entrepreneurs. They will reuse this beer to make disinfectants in the brewery which then will be distributed free of charge to hospitals, general practitioners and nursing homes in the Netherlands and abroad. Purpose inspires new ideas that start from value creation for customers or society. It is a beacon that keeps the organization on course.

2. Experimentation

There is big value in an in-depth discovery phase (comprehensive, quantitative, and qualitative research, stakeholder interviews, scenario planning). But companies have less and less time for these analyses. And how often a three- or five-year strategic plan has been crafted with a lot of time invested, only to become obsolete after a few months?

To develop successful and innovative strategies, companies need to make experimentation an integral part of everyday business. This means creating an environment where experimentation is valued over opinion, especially when it concerns the opinion of the highest paid person. An environment where employees’ curiosity is nurtured, data trumps opinion and anyone can conduct or commission a test. A great example of a company that has truly embraced the value of experimentation is Booking.com. They run more than 1.000 tests simultaneously.

Experimentation is mostly associated with execution and optimizations, such as running A/B tests on websites to improve conversion (as with Booking.com). But it’s important to start with experimentation early in the strategy process, since it allows you to eliminate strategic options ASAP and thus put more attention and focus to the other more relevant/powerful strategic directions. This requires a lot from senior leaders:

• They need to show discipline by, for example, terminating projects they personally championed or demonstrating a willingness to change their minds in the face of the data from an experiment.
• Failed experiments should be something to be valued by leaders, not something that should be avoided. Valuing failures will discourage employees to focus too much on familiar solutions and promote testing ideas that might fail. This will keep the company in the optimization trap instead of exploring breakthrough innovations and propositions.
• Resources and funds should be made available in a flexible way for emerging opportunities.
• They should develop a grand ambitious challenge that can be broken into testable hypotheses and key performance metrics.

If a CEO or CMO has an opinion on what is good for business, employees should be reply by saying  “Ok, we are going to test it and see if you are right.” 

3. Execution

Start executing immediately. In the digital era half a year could mean 40 updates from a competitor and external circumstances can change in a blink of an eye, as we have experienced with the current pandemic. Effective strategy processes will provide "just enough" planning to launch executable MVPs (Minimal Viable Products) or initiatives early, focusing less on exhaustive long-term planning and more on early execution as a matter of regular business rhythms. Based on the outcomes the strategic cycle starts again.

Given the larger number of employees involved in strategy, there is ample execution power available with thorough understanding of the strategy. The comparison with DevOps in software development is illustrative, since those practices are also intended to speed up delivery and development and ops teams are no longer “siloed”.

4. Education

Marketing capability development remains the top marketing knowledge priority according to the CMO survey. Mid-level managers and teams need to be able to devise strategy close to the action, based on local data and know-how. This is one of the core capabilities that I indicated earlier in my article Marketing Generalist 2.0 (in Dutch). In order to realize true democratization of strategy development, multiple centers of expertise should be formed throughout the company, both on corporate and local business unit level. These multidisciplinary teams will improve collaboration and contribute to the development of a common language.

The biggest change in way-of-working needs to come from mid-level managers, since they will have to coach junior teams to be strategic AND purpose driven AND to deliver executional excellence while learning new skills. At the same time this cohort of leaders may be the same people who are least comfortable taking personal risks.

The senior leadership team needs to give mandate and lead by example. It needs to ensure that the strategic investment approval process allows for multiple business models and create multidisciplinary “fit for purpose” teams for all approved strategic initiatives.

Moreover, senior leaders need to be humble in order to make this new way of strategy development work: see the world with a fresh perspective, redefine markets (in such a way that you have max 3% market share) and collaborate effectively.

5. Routines

New workflows and routines are required to ensure alignment between the dozens of self-organizing marketing strategy teams and the overarching goals and directions of the company. Strategy needs to be ongoing and supported by processes that balance the need for speed and flexibility with alignment. Processes are the new structure instead of hierarchy and traditional roles. This autonomy requires high discipline and accountability for everyone involved. The formulation of sharp hypotheses and rigorous experimentation procedures help making the strategic choices as objective as possible. When everyone embraces this high discipline and hypotheses are challenged on their value early in the processes, a flywheel will be set in motion that accelerates the company well ahead of competition.

Conclusion

Given the current Corona crisis situation we’re in, everyone by now recognizes the need for new, innovative  strategies for the new normal after the pandemic. The world is experiencing a serious burning platform. But we also need to make sure that we are ready for the next crisis, the one after that, and any other unforeseen exponential changes that the digital era has in store for us. Peer-to-peer strategy development provides a company with much more agility and executional firepower to anticipate and respond to changing external circumstances successfully.