STRATEGY As A First Principle

6ai Technologies, Making Strategy Better and Easier

We’ve all heard about the epic flame-outs of companies like Kodak and Blockbuster, Lehman Brothers, Worldcom, and most recently, Red Lobster, which seems to be entering bankruptcy. All are different companies with similar characteristics. They failed to focus on the most important things strategy and change, rendering them unable to identify and navigate changing environments; future opportunities and risks.

Strategy, therefore, is about identifying growth and opportunity and also managing risk. If there is no defined strategy process in place risk can increase exponentially without you even recognizing it, and the organization becomes a sitting duck.

Therefore, an embedded strategy mechanism within the organization can help leaders examine the landscape and form a POV, which then will allow teams to identify areas of opportunity and risk. Empowering the organization to leverage quantitative analysis effectively for optimal decisioning.

Risk is necessary for winning, and if we don’t take risks we’ll never know what winning looks like, but it’s often very risky to take risks without first good analysis and strategy. Effectively, you end up shooting in the dark. Taking risks intelligently, however, with a scientific methodology is the only way organizations can separate real opportunities for winning from a mirage. In the Information Age, it comes down to continually creating value through intelligent innovation. So the applied intelligence (ai) process is a scientific strategy method for leaders and teams to build the winning conditions for future success.

The world is becoming increasingly more complex, with ever-increasing amounts of information flows, with new AI-based technologies leading the way. Generally, everyone has the same access to information. So what we do differently with that information will separate us from the herd, which is key to differentiating ourselves in the marketplace. Context is key to deciphering and determining whether or not the information received can be useful in forming a good strategy. Accordingly, contextualizing and turning information into strategy is central to the applied intelligence process.

The leading organizations are the ones that can mitigate risk through technology by embracing transformation. So intelligent technology, no doubt, is important to efficient strategy development. But technology leading the process is not the right sequence. Strategy first, as a first principle of business development is the proper sequence.

In a survey of 3,910 business and risk leaders, big consulting firm PWC emphasizes how technology is increasingly important in helping organizations protect value by mitigating and managing downside risk more effectively.

“The age of the benign risk environment is over for the foreseeable future, amplified by the increasing pace and impact of technology change. These threats mean taking risk intelligently — powered by technology and framed by growth and opportunity.”

— Simon Perry, Head of Markets & Services, Risk, PwC UK

However, consultants as usual, don’t tell you the whole story, only the part that leads to them receiving big consulting contracts to tell people what they already know, or can find out themselves with a little effort. Therefore, PwC is wrong and self-serving when it says to put technology first instead of strategy.

Technology, at the end of the day, is a good tool when properly applied, however, many organizations are putting technology first, not understanding the proper flow or sequence in the application of both strategy and technology. And of course, they are being told by consultants that they have to apply complex AI and data solutions, so they can gain large contracts to show them what they already know.

The result of all this, according to Harvard Business Review (HBR); is that companies are pouring millions into “digital transformation” initiatives but a high percentage of those fail to pay off. That’s because companies are putting the cart before the horse, says Harvard, focusing on a specific technology (“We need a machine-learning strategy!”) rather than doing the hard work of fitting the change into the overall business strategy. HBR, in a Change Management article titled Digital Transformation Is Not About Technology, by Behnam Tabrizi, Ed Lam, Kirk Girard, and Vernon Irvin, points to the proper sequence: strategy supported by technology.

The article’s research, surveying directors, CEOs, and senior executives found that 70% of all digital transformation (DT) initiatives do not reach their goals. Of the $1.3 trillion that was spent on DT in the year of the survey, it was estimated that $900 billion went to waste. So why do some DT efforts succeed and others fail? The report found that those who failed lacked any upfront coherent strategy, and misapplied technology in the process.

Further, the research highlighted that most digital technologies provide possibilities for efficiency gains and customer intimacy. But if people lack the right strategic mindset to change and the organizational practices are misguided, digital transformation efforts will only magnify the existing problems.

Here are some noted lessons found in the article:

Lesson 1: Figure out your business strategy before you invest in anything, digital transformation should be guided by the broader business strategy, first.

Lesson 2: Leverage insiders. Organizations that seek transformations (digital and otherwise) frequently bring in an army of outside consultants who tend to apply one-size-fits-all solutions in the name of “best practices.”

Lesson 3: Design customer experience from the outside in. If the goal of digital transformation is to improve customer satisfaction and intimacy, then any effort must be preceded by a diagnostic and strategy phase with in-depth input from customers. A further understanding of the market and a forward-looking strategy before any technology is applied.

Leaders often wrongly expect that the implementation of one single technology tool or app will enhance customer satisfaction on its own. The reality is that without any defined strategy process in place to guide, successful digital transformation becomes elusive.

Lesson 4: Recognize employees’ fear of being replaced. When employees perceive that digital transformation could threaten their jobs, they may consciously or unconsciously resist the changes. If the digital transformation then turns out to be ineffective, management will eventually abandon the effort and their jobs will be saved (or so the thinking goes). Therefore, it is critical for leaders to recognize those fears and to emphasize that the digital transformation process is an opportunity for employees to upgrade their expertise to suit the marketplace of the future.

So bringing in consultants to teach, assist, or replace employees can be counterproductive, even self-sabotaging.

Lesson 5: Bring Silicon Valley start-up culture inside. Silicon Valley start-ups are known for their agile decision-making, rapid prototyping and flat structures. The process of digital transformation is inherently uncertain: changes need to be made provisionally and then adjusted; decisions need to be made quickly; and groups from all over the organization need to get involved.

Accordingly, strategy is holistic, not static, so strategy development can be all-encompassing in application to business transformation and overall organizational value creation. And in this incredibly complex Information Age, strategy is even more critical because you can’t apply anything if you don’t understand the context. Strategy, therefore, is fundamental, a first principle and a cornerstone to building any sustainable growth organization. Without it, as the evidence shows, failure can be inevitable.

In summary, the article’s central theme is that digital transformation works for organizations where leaders go back to the fundamentals, and focus on strategy first. Focusing on changing the mindset of its members as well as the organizational culture and processes, before deciding what digital tools to use and how to use them effectively. The member’s strategic vision must be the main driver of the organization’s future, not the technology.

Michael Goitein, in an article titled, Here’s why Strategy, not Agile, is the missing key to Business Agility. The author makes clear that even organizations that can be agile can still fail because agility is reactive, and strategy, on the other hand, is proactive. So being proactive is significantly more conducive to good growth outcomes.

Goitein gives the example of Nokia, the Finnish company that had reinvented itself enough times throughout its 147-year history and prided itself on its “Business Agility.” However, times and technology change and often very quickly. So when the Apple iPhone came on the scene with a meaningful long-term value proposition of making their products easy for consumers to use. Nokia found itself flatfooted! Its “reactive agility” was no longer good enough to overcome the well-thought-out long-term engaging strategy Apple was deploying. Nokia was caught without a strategy and in the end, it was just a matter of time for failure.

So in 2006, about five years after the first iPhone launch, Nokia finally responded with a so-called next-gen “MeeGo” device featuring a touchscreen graphic interface to “leapfrog Apple,” but it fell flat on its face. Firstly, the product’s long-delayed reaction made it no longer relevant. The fatal belief that a new shiny piece of technology without a meaningful story behind it would somehow beat out Apple’s well-crafted strategy of Why Apple products have meaning in your life. People began to define their technology use by defining themselves as Apple users.

By 2007, as the iPhone debuted, Nokia was valued at over $150 billion. The following year, in 2008, Apple and Google launched their iOS, and Nokia lost over 60% of its value. By 2009, Nokia had shed ⅔ of its value, down by over $100 billion — Nokia’s MeeGo was too little, too late. Its reaction life was four years behind Apple’s high-end iPhone and three years behind Android’s, low-end offerings. Nokia offered no compelling or differentiating user value proposition — no strategy!

So in 2013, Nokia sold what was left of its flagship mobile phone business to Microsoft for $7.2 billion, a fraction of its original worth.

There is a wrong but widespread belief that companies can be “Agile” and respond to shifting customer needs by just being reactive with new technology releases to counter competitors. They just have to be agile and build valuable products and services faster, better, and cheaper, and maintain market share. However, the data says differently, the truth is that Agile Transformations have a 46–96% failure rate.

So as with Nokia, not having a forward-looking strategy prevents you from examining the landscape objectively, and identifying and focusing on the next most important problem to solve. So what’s best for companies is putting strategy development first, as a first principle, then powering it with applied intelligence (ai) technology; a series of six steps (6ai).

The First step is Identifying the Problem, which requires data sourcing and aggregation. Second, is Framing the Strategic Question, requiring generating insights and targets. Third, Idea Generation, for strategy and planning. Fourth, Finding the Objective Truth, which centres around data quality control, i.e., garbage in garbage out. The fifth, Execution and the Sixth and final step is Iteration and Testing. Please See below.

The 6 steps to the 6ai strategy process are foundational because first and foremost, they help us identify the right problems to solve. And unites us around a scientific and data analytics and AI-driven process, that is a reliable generator of insights.

For 6ai, technology is a powerful enabler and when harnessed to human ingenuity and innovation can bring strategy to life, identifying the right opportunities and risks along the way. 6ai, therefore, offers a SaaS-based software solution to build and execute strategy with speed and accuracy, which humans can’t do, but the computational power of machines can. Nevertheless, together they’re an awesome force!

Deciding which problems to solve — what strategy path to take, market size and fit, can now all be done more efficiently, effectively, and incredibly cheaper with 6ai and at a very fraction of the cost of hiring overpriced consultants.

The continuous discovery and cross-functional functionality of 6ai, powers executives and managers to compete effectively in an ever-increasing digital and AI-driven world. 6ai provides a disciplined framework for analysis and iteration, using intelligence-based functions and systems that can be taken as empirically warrantable. For leaders to build and execute strategy with confidence.

6ai is inclusive, having team functionality allowing team members to step up into key design and tech roles because 6ai software doesn’t require any training or the use of any complex technology tools. It enhances team approaches to development and manages risk effectively because the more eyes on a project the more diverse and objective contributors there are. Servicing for optimal iteration and managed risk.

Great products are always a function of great strategy and great strategy is a function of optimal inputs, so strategy is inherent to design thinking and creativity. Allowing the entire team to participate and add value helps them to empathize with clients’ needs, align with market fits, and better focus on every product decision to be made.

“When there’s clarity around which problems to solve, and the strategy is simple, clear, and well-understood across the organization, product-level decisions become simpler, without the need to resort to the “band-aid” of prioritization frameworks.”

— Michael Goitein

6ai software also brings strategy in-house and creates another dimensional level for sustainable organizational growth. Raising awareness around strategy development and removing the fallacy that consultants alone can build strategy. 6ai builds business resilience for success even in continuously changing or volatile markets.

In the recent PwC Global Risk Survey, the majority of respondents said “Artificial intelligence automation can help us improve efficiency, while data analysis capabilities can help us make more accurate judgments and mitigate risks.” However, they couldn’t point to a comprehensive strategy-technology tool that properly enables that process — 6ai provides that solution through software.

6ai software’s core value proposition is accessibility for EVERYONE: from small and

medium-sized enterprises (SMEs) to organizations, institutions, government, and individuals. 6ai uses GenAI properly and responsibly, providing a higher dimensional level of useful, robust, and reliable insights for do-it-yourself strategy development. Enabling those without technical backgrounds with the ability to develop highly effective strategies without having to learn complex software or digital tools.

In the 21st century, organizations can no longer afford to rely on a manual or pure human reactive process exclusively, nor is an all-technology approach the solution. 6ai is the balanced commonsensical and sequenced approach to identifying opportunity and managing risk for winning organizations of the future.

The world is becoming more complex each day, which now goes beyond the traditional micro-enterprise factors of business. Complexity and risk are also macro in scope. From climate change mitigation and ESG to geopolitical and global macroeconomic volatility, which are all connected in a globalized business environment. And so too, no enterprise large or small is free from the disruptive power of technology. Transformation and change are a must for survival, and organizations that employ strategy as a first principle. Those who can rethink and reframe in real-time, with relevant information and insight generation, will not only survive but will strive in the 21st century.

Throughout history, the ability to adapt, change and reinvent has been a common factor for sustainable growth, prosperity and continued opportunity. What is also true is that those who experienced such success also utilized technology effectively, and put strategy first!