What does Strategy have to do with it?

How to develop your strategy stack - Part 1

I could make this the shortest newsletter ever and simply say - everything. Instead let’s dive into the how-to’s of creating an effective strategy stack.

Today I am going to cover Part 1 of how to create a strategy stack for your organization and product team. The focus will be on the Mission, North Star and Vision. In Part 2, we’ll cover the Organization’s Strategy and Goals. Part 3 brings together the Product specific Vision, Roadmap and Goals

Quick refresher

I’m a strong believer in the importance of a well defined strategy. Your strategy creates alignment across your organization and team, not just for today - but for tomorrow and beyond. Want everyone to understand the “why”? Establish a clear strategy. Want everyone to be heading off into different, unrelated directions? Ignore your strategy.

I shared a preview into my thinking in Leadership lessons: Ted Lasso's winning way. In the article, I introduced the product portion of strategy development. I referenced an article from the Product Coalition titled ‘How-To’ Guide for Crafting Your First Product Vision’ and Marty Cagan’s work, specifically Empowered.

I also provided another tip of the hat to Reforge’s The Product Strategy Stack which brings in the company elements at the top of the strategy stack.

As with pretty much everything in the life of a PM, there are multiple ways to get to your goal. What I am describing here is the approach I have taken and considerations I faced. You can use my learnings to jumpstart your own strategy stack development.

Mission statement and things to keep in mind

At the tippy top of the strategy stack are the company (organization) elements - Mission, Vision, North Star, and Goals. 

Even at an early stage start-up, there are typically assets (documents, notes written on napkins, Figma sketches, videos, etc) which provide a view into ‘why’ the company exists. As a starting point, I recommend seeking out these assets as they can help to frame your organization’s reason for being - specifically its Mission. The Mission also will be referred to as the Mission statement. If they don’t exist, no worries. Interview individuals across the organization who have been there since the beginning. Within the discussion, ask about the reason for starting the company (why) and facets they knew they could do differently than others (how).

The Mission is often defined by the CEO and/or Leadership team. It has an indefinite timeframe of applicability and is aspirational in nature. Given these characteristics, a Mission is not measurable or action oriented. Instead characteristics of a Mission statement include the following:

• Company value and purpose for being.

• Typically does not change.

• Designed to be outward facing.

• Short and to the point.

NOBL provides the following guidance:

Mission: An ambitious yet achievable position in the market or in your customers’ lives that recognizes your Purpose. It should make clear which business you’re in, and often starts with the phrase “Be the most…”

In a similar manner, Reforge defines a Mission as the following:

The world your company sees and the change it wants to bring to that world

Examples of Mission statements include:

• Google: "To organize the world's information and make it universally accessible and useful."

• Microsoft: "To empower every person and every organization on the planet to achieve more."

• Apple: "To make the best products on earth, and to leave the world better than we found it."

• Meta: "To give people the power to build community and bring the world closer together."

• Shopify: "To enable anyone to set up an online store and sell their products."

You’ll notice, all the Mission statements share a common goal: to make a positive impact on the world. They also reflect the unique values and culture of each company.

Based on the insight above, remember what caused you to join your current company. What about the company spoke to you? What type of impact is your organization seeking to have? If nothing comes to mind, don’t give up. Use this article to reestablish your company’s position in the market for yourself, your team and organization.

North Star is the metric around which all company priorities are aligned

Partnering up with the Mission, is the North Star. The North Star is a single critical rate, count, or ratio that represents your company’s strategy. As there is one North Star in the sky, an organization should have one North Star.

The North Star should be achievable, not quickly, but over a timeframe often between five to 10 years. Why? If a North Star is not achievable, people in the organization will start to wonder what they are striving to achieve. Motivation will drop, teams will start heading off in different directions, and goals will be ignored. Instead an achievable North Star enables everyone to understand, track, and acknowledge their contributions in support of the Mission.

The Silicon Valley Product Group shares, every product team, no matter what area they are working on, should understand how their work contributes to the larger whole through their contributions to, and focus on, reaching the North Star.

This metric is a leading indicator that defines the relationship between the customer problems that we are trying to solve and sustainable, long-term business impact.

What happens once your organization has achieved its North Star? Celebrate! Throw a party. Do a happy dance. While the Mission does not change, the North Star does. And, once it’s been achieved… guess what… You get to define your next North Star and pump up your team to strive for the next taller mountain and enjoy the view once they reach the top.

Don’t have a North Star today? No worries. Amplitude (courtesy of John Cutler aka Cutlefish) has a playbook which can be used to help define your organization’s North Star. It has excellent guidance including criteria to call upon to define the North Star.

• Expresses value

• Represents vision and strategy

• Is a leading indicator

• Is actionable

• Can be easily understood

• Is quantifiable

• Informs mid / long term business impact and customer value

Work at a philanthropy? The preference may be to have the North Star be a guiding principle or aspirational aim instead of a metric. In such cases, the focus is on the inputs - a small set (3-5) of influential, complementary factors that must be directionally aligned to affect the North Star which are referred to as “constellations”. I like to think of them as rocketships. You know what you’re aiming for is a long way off (aka in a galaxy far, far away). To reach your destination, all the rocketships must be heading (and making progress) in the same direction.

To define the North Star and “constellations”, I recommend forming a small cross-functional working group of Data Science, Design, Operations / Strategy, and Product. As you brainstorm and diverge / converge through the following steps together, you can use Miro, Mural, or FigJam. At my company, we’re fans of Figma and FigJam.

Step 1: User value

• Brainstorm potential user values for each customer group (aka audience) - aka diverge.

• Agree on one key value for each audience - aka converge.

• Note: Depending on your organization, you might have one or multiple audiences you’re targeting. That’s fine. Narrow it down by starting with your ideal customer profile (or persona) first. Then, time permitting, jump to secondary or supporting audiences.

Step 2: Key metrics

• Brainstorm possible metrics for each key value identified in Step 1 - aka diverge

• Narrow in on 1 key metric for each audience - aka converge

Step 3: North Star Metric

• Bring together key metrics identified in Step 2 into one proposed North Star metric

Vision is what the company most hopes to be and achieve

While the Mission does not change, the Vision evolves over time. As markets, competitors, and customer needs change so does the Vision. If it stayed the same forever, a company would be stuck in the past. Iterating on the Vision ensures an eye towards the future which is inspirational and motivational, both internally and externally.

The Harvard Business Review has an excellent article on Building Your Company’s Vision. Key points being:

• Vision provides guidance on what foundational (core) elements to preserve and what aspirational future characteristics or goals the company hopes to achieve.

• A well-conceived Vision consists of two major components: core ideology and envisioned future.

Core ideology defines the characteristics of the organization - e.g. what makes it unique. It provides the glue that holds an organization together as it evolves. The two main components are:

1. Core values - timeless principles guiding the organization.

2. Core purpose - soul of the organization, its reason for being

Envisioned future includes a 10-to-30-year audacious goal called a BHAG (big hairy audacious goal). Just like the word “audacious”, you want the BHAGs to be inspirational, challenging, and compelling. To put a ribbon around the goal, it should have a clear and agreed outcome or target.

Vivid description captures all the feelings of achieving the BHAG. It makes the BHAG (and reasons for celebration) tangible in people’s minds.

Building a visionary company requires 1% vision and 99% alignment.

Visionary companies preserve their core reason for being through times good and bad. It is the Vision that provides the context, the music or movie that everyone has playing in their head as they move forward together. Going back to rocketships, a visitor from outer space should be able to grasp your company Vision simply by observing how your company works and acts.

Can you combine the Mission and Vision?

Some organizations will combine the Mission and Vision. If your organization has taken this approach, the statement should reflect the combined characteristics of a Vision and Mission, and at the same time include all the values that drive the company and its employees day by day. Sound like a lot to stuff into one statement? Yep, that’s one of the reasons I do not recommend this path. Here are a few more reasons:

• Clarity: A Mission statement should be clear, concise, and easy to understand. A Vision statement should be more aspirational. Combining the two makes it difficult to communicate both effectively.

• Focus: Combining the two can make it difficult to stay focused on both the short-term and long-term goals of the organization.

• Adaptability: A Mission statement should be relatively stable, while a Vision statement can and should evolve. Combining the two can makes it difficult to adapt the organization's strategy to changes in the environment.

• Inspiration: A Vision statement should be inspiring and motivating for employees. A Mission statement is more factual and informative. Covering both inspiring and informative can be difficult to do effectively.

Key learnings and looking ahead to Part 2

Now pat yourself on the back. You have an excellent foundation upon which to build the top of your company strategy stack.

Let’s take a minute to reflect on things we’ve learned so far.

• Mission: The company's reason for being. It is aspirational and does not change.

• North Star: A metric around which all company priorities are aligned. It should be achievable, measurable, and actionable. Once reached, a new North Star is defined.

• Vision: What the company hopes to be and achieve in the future. It evolves over time.

Here are some key takeaways:

• A well-crafted Mission statement is clear, concise, and easy to understand. It should be outward facing and reflect the company's values and culture.

• The North Star is a critical metric that helps to align product teams and measure their contributions in support of the Mission.

• The Vision statement should be aspirational and inspiring. It should provide guidance about what core to preserve and what future to stimulate progress toward.

• Mission, North Star, and Vision are the top three components of a strategy stack. They provide the foundation for all other strategic planning and decision-making.

In Part 2, we will cover the Company Strategy and Goals. We look forward to seeing you in Part 2.

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