HE CATERPILLAR doesn’t become a butterfly overnight. It evolves and evolves and evolves again. It is a purposeful metamorphosis from crawling creature to an entirely different being that can fly. At every stage, the caterpillar faces challenges and frictions. It overcomes them to become a different version of itself. That is the caterpillar’s edge.

Sid Mohasseb writes in The Caterpillars Edge that “to realize an improved future you must purposefully leave the past behind, and embrace the uncertainty ahead—constantly and without fear. You must evolve, then evolve again and thrive.”

The problem as Mohasseb sees it is that many leaders are stuck in their approach to planning and execution. “They are guided by old habits formed in an era when competition was more static.” The data you are using can’t be captured in a fixed plan or you’ll have an excellent strategy for the year before. Your planning and execution needs to be more dynamic than that.

We need a new and more agile approach. “The world will not wait while you contemplate, take time to gather enough data to be exhaustive in your analysis, and then build consensus around actions.” You can improve your “likelihood of winning by constantly reading and applying the incoming data points.” “You must learn and live and compete in an uncertain and always changing reality.” Prefer change to the comfort of stability.

There are three crucial rules to be applied here:

1. Align with Uncertainty—Adjust to the dynamic world around you. Be prepared to shift your focus at all times. The market is shifting. By the time you transform, the advantage you wanted may be long gone.

2. Appreciate Reality—Understand what is practical and achievable by you and your company. You can evolve over and over.

3. Aspire for More—Seek more data, more analysis, and more “Aha” moments or move faster to reach the moments of insight, where the solutions to problems become clear. McKinsey reports that eight out of ten times strategists focus on known hypothesis—opportunities that have been examined in the past or are already evident.

“Most people use analytics in the context of consumer-level transactions. But there is no lasting strategic advantage. When people claim that they are competitive because they are using analytics, that’s just the flavor of the day. Now unless you tell me that you have used data analytics in order to find a new product ground, a new design, and a new market, you are not strategic . . . as opposed to let’s sell more shoes to the guys who are buying shoes . . . what is being done for the most part today is a kind of a tit for tat, and that’s what I see most people calling gaining competitive advantage.” Optimizing today’s processes for greater efficiency does not necessarily offer an advantage for tomorrow. Use the force and create the future. Don’t use the data to justify your actions, use it to discover advantages.

It’s not the analytics, but the execution. Analytics is just and tool and soon will be found and used by everyone everywhere. As that occurs, the “business basics of good strategy and execution will, once again, drive the lasting victories.”

A winning strategy must be adaptable from the start. Be prepared to improvise.

Selected Caterpillar Edge advice:

  Every plan has to offer a wave of strategies—a collection of related strategies with identifiable pivot points; demand to see the signals that will be monitored to trigger a point.

  Avoid having independent plans by functions or business units—all plans must include internal and external shared signals that glue the organization together.

  View and leverage “data” as an asset—not a byproduct of your execution and a means to measure your past actions. Declare that data and analytics will be driving decisions; then actually let it.

  Avoid the urge to solve first and justify with data later. To gain new insight, always look to disprove yourself.

  Erase the line between planning and execution. Be upfront with the organization: you will change the plan when needed; the month of the year is not going to dictate your destiny and the ability to gain a timely advantage.

  Dynamic is different for every organization. Chose your initial pace and aim to beat it. Remember: being dynamic in planning and execution is different than being agile in executing against a static strategy.

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Posted by Michael McKinney at 12:34 PM
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