Saturday, September 26, 2009

Strategy as surfing a wave #4: What do successful surfers do?

We saw in previous articles how Internet wave hit Grossman at IBM and how he teamed up with Patrick to surf the wave. Skeptics asked the question, “How will we make money from this?” Unfortunately, neither Grossman nor Patrick had any numbers to back up in the beginning. What do successful surfers do in such situations? Let’s see how Stephen Denning helps us understand the surfing through “storytelling” goggle. (source: The leader’s guide to storytelling by Stephen Denning)

According to Steve, successful surfers like Grossman, Patrick and Gerstner are good at 4 things: They have (1) the ability to perceive a new story of business opportunity (2) the courage to believe passionately in that future story and act on it (3) the flexibility to adapt the story in the light of market realities and above all (4) the ability to persuade others to believe in the story. Let’s see each of these in brief below.

  1. Perceive a new story: When Grossman showed Internet demo to 3 people, only one of them, Patrick got excited. Patrick recalls - Two people can see the same thing, but have a very different understanding of the implications. A lot of people did say, “What’s the big deal about the Web?” but I could see that people would do their banking here and get access to all kinds of information. I had been using online systems like CompuServ for a long time. So for people who weren’t already using online systems, it was harder for them to see. (source: Gary Hamel case study)

  1. Believe in the story: Patrick didn’t stop at perceiving the story. He hired Grossman and together with Singer they started building a primitive corporate intranet. Patrick wrote a nine page manifesto extolling the Web titled “Get Connected”. It included things like: Replace paper communications with e-mail, Make top executives available to customers and investors online, Use the home-page for e-commerce. It’s only when you believe in a story passionately does it translate into actions of these sort.

  1. Adapt the story: Much of the technology that Grossman and his crew first prototyped would later make its way into industrial-strength products. For example, The Web server software developed for 1996 Olympics evolved into a product called Websphere and much of what they learned formed the basis for a Web-hosting business today supports tens of thousands of websites.

  1. Persuade others: Both Patrick and Grossman continuously looked for opportunities to spread the movement within IBM. Patrick would present the story in senior management forums and trade shows while Grossman would work with engineers spread across multiple businesses. Within months more than 300 enthusiasts had joined virtual Get Connected team.

We looked at Joan Magretta’s 2-critical tests to check if your business model is sound. (1) Narrative test: Check if the story makes sense and (2) Numbers test: Do some basic math and see if the numbers add up. Grossman-Patrick story tells us that when big waves hit, numbers are not available. Successful surfers learn to master the narrative test.

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