Strategie = Execution
Winning combination: Minimal design (MVP) paired with appropriate scaling
One of the questions professionals most frequently ask about strategy execution is how Minimum Viable Products (MVPs) and Scaling Methods are interrelated. I discussed these two topics separately in my book Strategy = Execution, but did not explain in detail how they’re linked to each other. Hence this blog post.
Designing and working with Minimum Viable Products (MVPs).
Although there were already newer concepts out there, like the Minimum
Awesome Product (MAP) and Minimum Viable Experience (MVE), which focus on the first customer experience rather than the first functionality you want to offer, I devoted an earlier blog post to the basic notion of the MVP. I also discussed MVPs in Strategy = Execution (2020), Building Block 6: Breakthrough. Figure 1 shows exactly what I mean: you want to come up with a concise design that is not perfect, but good enough to start.
Picking and applying a scaling method. This was the topic of my blog post titled Scaling Requires a Modern Mindset in Change Management. In this post, I wrote about the variables that determine what the most appropriate scaling method is: 1. Urgency 2. Ambition 3. Absorption Capacity 4. Execution Capacity 5. Risk of Reputation Damage. These determine which of the six scaling methods I discussed is best. You can read more about this in Strategy = Execution (2020). See Figure 2: Choose your scaling method carefully: which chunks in which waves? Small can be big.
In strategy execution, the winning combination is the combination between (1) Designing Minimum Viable Products and (2) Carefully selecting the best scaling method.
These days, businesses aim high. Not only do they want to add ever more features to their MVP, they also want to execute each iteration of their MVP to every last nook and cranny of their organization in order to realize the benefits. This shows—yet again—that the hardest part of strategy execution is execution, not strategy: executing an MVP is much harder than designing it. It requires you to use every single strategy execution skill you have. Get it right, and you have a winning combination! But how do you get it right? To answer this question, Turner Consultancy has pooled its resources and expertise in Turner Next, peopled by innovation leads like Frits Korthals Altes, Tessa Rombouts – van Puijenbroek, and Jeroen Visscher.
This figure is key to an effective Strategy = Execution approach.
Figure 3: Small can be big: Working from small to big along two axes. Systematically analyze and decide which change will be designed when, and executed when and by whom, and which scaling method is most appropriate. Decide how to build content (Y-axis) and how to scale it (X-axis) and do this for each strategic priority and each individual line of action.
Organizational scaling (X-axis) is more critical than building content (Y-axis):
your X-axis represents true execution and scaling. Let me give you an example. At a business service provider, most products eventually needed to be rolled out to 400 professionals and their clients. Designing a new release of the MVP (Y-axis) does not really have an impact on the organization’s—critical—execution capacity.
It’s not so hard to have your design teams come up with MVPs and deliver a new version every 3 weeks (Y-axis). But be aware that this is of limited use. At best, it might be helpful to have a small pool of MVPs waiting, to have some execution jobs waiting to be carried out. But avoid creating a huge backlog of MVPs. After all, Strategy Equals Execution. The first execution wave of your 1st MVP provides immediate feedback on this MVP and therefore has an impact on your 2nd and 3rd MVPs and so on. Looking at Figure 3, bear in mind that you should begin by working from left to right (on the X-axis), and only then start working vertically (Y-axis).
The key issue is always how much scaling capacity (X-axis) your organization has for each individual design (MVP version). Obviously, the answer to this question partly depends on whether a given MVP involves the same or different organizational units. The larger the overlap, the more impact the scaling process will have (X-axis). The smaller the overlap, the more designs and scaling processes can be done in parallel. Agile program management can be used to manage this. If designing and executing your top 3 MVPs doesn’t fully utilize your execution and scaling capacity, you could add numbers 4, 5 and 6 from your list of MVPs. But take a reality check here. In all my years of experience, this has never, ever happened. Scaling capacity is the bottleneck of execution capacity. Always.
The complexity of both axes depends on several variables. As a side note, things are not always black and white. I just wrote that you should start on the X-axis and then move on to the Y-axis represented in Figure 3. However, as my colleague and innovation specialist Frits Korthals Altes pointed out, in many cases the organizational side of the equation is not so complicated (X-axis), because the MVPs are mainly geared toward adding functionality in order to improve the business’s customer value proposition (Y-axis). In such cases, for example in digital customer value propositions and business models, the challenge is not so much organizational, but rather a matter of prioritization. The key question is how to decide which functionality to add first, depending on the (next) projected step in value creation. Sales then needs to weigh the importance of adding features aimed at retaining the business’s existing customer base versus adding features aimed at attracting new customers. Such choices can only be made based on an overall sales strategy that takes into account attracting new customers, as well as churn and customer value.
Know the controls. You’ll always have to deal with limitations and contradictions. To do so, you’ll need to use whatever controls there are. And fortunately, there are some: 1. Portfolio Management 2. Size of your MVPs 3. Capacity in your bottlenecks 4. Scope; and 5. Input/Output/Throughput management.
Strategy = Execution. Renew and innovate faster in the digital age.
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And how can they learn to improve, renew and innovate faster? That’s the topic of the book Strategy = Execution. Based on Turner Consultancy’s research citing 60 organizational leaders, 75 case studies and 300 published sources, which answers the central question: What makes or breaks modern day strategy execution and innovation?
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