Category Archives: Strategy

Creating Space for Strategic Thinking in Business and Life

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Clients often engage us to help them think differently, often more expansively. All come in with a desire, idea, or plan – could be for a next gen product or better user experience, tapping into a new market, developing a go-to-market launch campaign, improving their brand strategy, or something else.

They generally believe the essence of their idea or plan is good, but have a niggling feeling that their idea or plan may somehow be “off” or missing something, but can’t really put their finger on what’s going on or why.

It’s kind of like, on a personal level, when you start to do something and some deep knowing inside says “wait!” or “think again” or “there’s more here.” We’ve all experienced this uncertainty in business and life, countless times. You might notice it as tightness in your gut, or cloudiness in your mind, or a drop in your energy. At that point, you have to choose – you can just keep going anyway and ignore that internal guidance system; or you can stop, step back, and think strategically about your idea or plan from a much larger perspective.

In business and life, stepping back to think from a larger perspective is what I mean by “creating space” for strategic thinking. Now I recognize that to some of you this may sound “woo woo” and very California (hey I live in San Diego!). But hang in there with me.

Because when you do create a bigger space for strategic thinking, all kinds of new possibilities emerge. The result may be a major pivot, a slight adjustment, or no change at all. The other really important outcome is your acceptance at a deep level and without reservation that you are on the right track and doing the right thing.

Here’s what happens: By creating space to think strategically from a much larger perspective, you are letting go of the how (for the moment) to focus on the what. You become aware of any self-justifying but discomfiting loop you were in. You see where your creative exploration of possibilities and strategic thinking was constrained in non-productive ways.

What very quickly becomes clear is whether your desire, idea, or plan is in alignment with the mission and purpose of your company or business unit. In other words, you will know if, from your internal perspective, your what delivers on your why. Then as a next step, you might choose to do research with your stakeholders and customers to see how they perceive the alignment between your desire, idea, or plan, what they expect of your company, and what they want and will buy and use.

Most importantly when you create a bigger space for strategic thinking, you are demonstrating to yourself and others in your company to trust and act upon the inner guidance we all have. Which is very different than deferring to the critical voice we all have as well. You can tell the difference because when you move business decisions into a more expansive space though your inner guidance system, there is no judgment involved. The higher level of strategic thinking emerges naturally and with little effort. When your critical voice is the driver, the experience is full of judgment and diminishment. Not fun, not productive.

Next time you are faced with making a decision on a desire, idea, or plan, and some deep knowing inside says “wait!” or “think again,”… then listen. Do it. Give yourself and your team the opportunity to step back, make space for fresh, strategic thinking. Emerge knowing with clarity the right next steps.

Acknowledgement: Thanks to author Jim Case for inspiring this post.

Healthcare Trends: What Customers Want – and Don’t Want – From Insurers vs. Providers

There are three significant and interrelated trends we are seeing from our research with health insurers and their members, providers and patients, and payer-provider systems. Taken together, these trends point to specific directions for health plans and healthcare provider organizations to take in order to better engage and satisfy their customers.

Improving Health: 3 Trends in What People Want

  1. More people want personalized health advice on what’s right for them.
  2. They expect doctors to provide them advice on their physical health and medications. But for lifestyle issues like stress management, weight loss, sleep–they seek solutions elsewhere.
  3. For lifestyle changes, they are open to advice from insurers–as long as it’s tied to how to use their health plan to stay healthy.

One key driver of the differences in what people want from their health plan vs. from their providers is mindset. Generally, people take on a “patient” mindset when they are sick and actively needing care from providers. They take on a “consumer” mindset when making lifestyle choices for chronic conditions and when dealing with their insurance company. These different mindsets lead them to want, expect, and accept different things from insurers than from providers. Understanding these two mindsets is critical for insurers and providers to develop the right programs and services people want and will use.

What People Want From Providers: The Patient Mindset

When a person has an acute illness or injury, they are in patient mode. What do patients want, and from whom? Patients want advice from their provider on their condition, symptoms, medication, treatment, and prognosis. Patients believe providers have the training and expertise to help them and should have their best interest in mind. After all, that’s what doctors, nurses, and other providers are meant to do.

Patients do not want advice from their insurance company about what care is appropriate for acute illness or injury. Right or wrong, patients often see insurers as obstacles to optimal care, not enablers. In the heat of the moment, they may lose sight of the fact that their health plan provides them with significant benefits and instead they focus on what they don’t get.

For many health conditions, patients sort of have to trust. As my friend and lifetime health educator, the late Dr. Shimon Camiel, said: “Sure, if I have high blood pressure, I want to be empowered and involved. But if I have an ax in my head, I just want the ER doc to take it out and save my life!”

So in the traditional patient/provider acute care relationship, the “contract” is this: patients trust, providers fix.

What People Want From Payers: The Consumer Mindset

When a person is dealing with coverage or benefits, they are in consumer mode. They expect to go to their insurance company – not their provider – about coverage decisions, or determining what providers they can see, or where to get their prescription filled. Similarly, they are open to getting advice about how to improve their lifestyle or better manage a chronic condition from their insurance company, as long as the advice is tied to using their benefits better. Consumers are not particularly wanting or expecting health improvement advice from their insurance company if it is not tied to benefits. To consumers, it makes sense and is reasonable that their insurance company will help them do things that both improve health for the individual and save money for the payer. That’s the heart of the win-win.

Consumers do not expect advice from their providers about benefits utilization or coverage. And many don’t turn to providers for help with health habits and lifestyle management unless it is tied to particular conditions like high blood pressure, obesity, or diabetes. Note that when dealing with long-term chronic conditions, people tend to be more in a consumer mindset than a patient mindset– even when interacting with their providers. I’ll cover this complexity in a separate post.

Like sick patients do, consumers sort of have to trust in the system. What is and is not paid for is governed by what their health plan covers, or what they are willing to pay for out of pocket. So the “contract” between consumers and insurers is this: Consumers make good choices, insurers pay for them.

Acting on the Trends for Better Business

Leverage these three trends as a starting point when you think about what your organization can and should offer to your customers. Then do the research to make sure you’re solving meaningful problems that people want your organization to solve.

The result is happier and more engaged patients and consumers and a far better user experience. That translates into brand loyalty and ultimately improved health and reduced costs.

Happiness as Competitive Advantage? A Challenge for Health Companies

company_happinessYou may be familiar with the Kingdom of Bhutan’s Gross National Happiness (GNH) index. This small Himalayan nation is the only country in the world that measures and aims for national happiness as its most important objective. The intent is to build an economy and culture based on spiritual values more than on material wealth. It prioritizes GNH over GDP. Bhutan’s commitment inspired the United Nations to pass a resolution that placed “happiness” on the global development agenda.

What does this have to do with you and the success of your company that’s in the business of health?? Potentially, a lot. As you read what follows, consider the notion of balancing both profitability and happiness as guiding values and major indicators of success.

Bhutan’s young King Khesar put it this way in his coronation address: Yet we must always remember that as our country, in these changing times finds immense new challenges and opportunities, whatever work we do, whatever goals we have – and no matter how these may change in this changing world – ultimately without peace, security and happiness we have nothing. That is the essence of the philosophy of Gross National Happiness. Our most important goal is the peace and happiness of our people and the security and sovereignty of the nation.

Most companies in the health industry base major business decisions on financial metrics like ROI to shareholders, quarterly numbers, and EBIDTA. Which makes sense. You need to be successfully financially and deliver a return to investors to be a going concern.

Money matters, no matter how dedicated your company is to improving health and saving lives. “No margin, no mission,” as the late Sister Irene Kraus, former CEO of the $3 billion Daughters of Charity National Health System, is credited as saying.

And, and… maybe happiness can matter just as much as money, and measurably contribute to your company’s financial success.  Especially since you’re in the business of health. Many start with employee happiness and well-being. Kaiser, Genentech, Mayo Clinic are a few of the health companies that have a reputation for really investing in the well-being –  and thereby the happiness – of their employees.  And there’s much further to go.

Let’s do a thought experiment: What would if happiness of your employees was a measure of your organization’s well-being? What about delivering  happiness to your customers?  Can you imagine happiness as part of your brand promise? Part of your unchanging core values? A key differentiator in highly competitive market? A metric you proudly talk about to shareholders and investors?

Be happy??

Companies in Healthcare: What Could Make You Disappear??

The healthcare industry is changing at an incredible pace. That means winners and losers. New companies emerging and existing companies going away. What could make your company disappear?

To be clear, by “make your company disappear” I don’t mean some super-powered ray gun or a natural disaster that would ‘poof!’ make your company suddenly vanish, dissolve, or fade away.  I’m asking seriously what could make your products, services, or company irrelevant, obsolete, or undesirable?

And I apologize. I know disappearing can be an unpleasant thing to think about. But it’s really important to think about, especially when you’re doing well. As you know, there is a plethora of products, services, and companies that were once great, and then succumbed to forces that made them disappear.

In today’s healthcare environment, just consider the impact of Meaningful Use or the MEDTECH Act; the shift toward value-based reimbursement or growing influence of GPOs; the proliferation of wearables and monitoring devices; and the health plays of leading tech companies like Apple and Google.

Any of these forces can position a few as market leaders, necessitate radical restructuring for many, make other companies disappear, and launch countless new startups to replace them. You want to stay strong. Be proactive. Don’t be one of the disappearing companies or a victim of circumstances.

First consider your company’s relationship with the market and healthcare business environment. Start with these five questions:

  1. What change in the market can make my products or services irrelevant, obsolete, or undesirable?
  2. What technological innovation can make my products or services irrelevant, obsolete, or undesirable?
  3. What shift in consumer behavior can make my products or services irrelevant, obsolete, or undesirable?
  4. What policy or regulation can make my products or services irrelevant, obsolete, or undesirable?
  5. What competitor can make my products or services irrelevant, obsolete, or undesirable?

Your answers should help you look beyond the present, see threats to your long-term viability, and proactively make plans to preserve your company’s existence and well-being. Think big picture, not just about what might replace your offerings, but what might integrate your technology into something bigger, like smartphones have integrated the functions of MP3 players. Consider too getting input from KOLs and customers to give you a more well-rounded perspective and greater certainty in your conclusions.

Now take a look at your own internal practices and beliefs, that if unchecked, can prevent you from being agile and responsive, and ultimately make you disappear. But don’t do this assessment unilaterally, get feedback from your team. Drawing on the innovation work of Dartmouth professor Vijay Govindarajan, think about these three traps that can make even highly successful companies flop. Do any apply to you?

  1. Major investments in systems or technologies can make it prohibitively expensive for you to move to newer and better tools. But the longer you stay with what you have, the harder it is to switch. Some call this the “sunk costs” fallacy.
  2. Fixation on what brought you success blinds you to new things that can threaten or displace you. You don’t see it until it’s too late. Then you respond with desperation. Sometimes “if it ain’t broken, don’t fix it” just does not apply.
  3. Hyperfocus on today’s marketplace can lead you to ignore new trends and market forces, and future opportunities and threats. You may be too wrapped up in the business to focus on the business. You’re all about today, and lose out on forward thinking.

Combine your answers to the first set of questions about your company’s relationship with the market and external environment, with your assessment of traps based on internal practices and beliefs. Be honest.

Stay strong. Don’t disappear!

Let’s Stop Confusing Strategy and Tactics in Healthcare

strategyI can’t tell you how many times we’ve seen very smart healthcare companies – med tech companies, payers, provider organizations, etc., confuse strategy and tactics. And it reduces their effectiveness every time.

Why do strategy and tactics get confused? First, sometimes there is not clarity about what the real objective is and why. This subjects companies to the paradox Lewis Carroll described this way: “If you don’t know where you’re going, any road will get you there.”  Without a clear end point in mind, develop meaningful strategy to get there is very difficult.

Second, there is so much pressure to get new things to market, it makes it hard to carve out time and think strategically. There’s only time to “do” — even if what is being done doesn’t make good sense.

So what’s the difference? Strategy determines how you will achieve your goal. It represents which map you will use to get where you are going. Tactics are the map details and are all about the doing.

Let’s start with a couple military examples: 1) Divide and conquer is a strategy. Sending half the troops in a frontal assault and half on flanking maneuvers are the tactics that executes on the strategy. 2) Go big, go long, or go home, were the three strategies being considered in the Iraq war. How many troops would be where and when were the tactics, and that’s what got all the media coverage.

Marketing examples: 1) Be first to market is a strategy. Be a fast follower is an alternative strategy. The specific products or services you take to market, the resources you allocate, and the timing are all tactics. 2) First get prospects in the door with a low barrier to entry, then engage them to be customers is a strategy. How you will go about getting them in the door and converting them into customers are the tactics.

 

Don’t be one of the many companies that spend millions of dollars and years of effort on something only because their competitors are doing it. Have a good compelling reason. That way you know where you’re going and why.

Next be clear about what your strategy is, and why. Make sure your strategy is really strategy — and not tactics with the word  strategy attached. Then get into the tactics that execute on the strategy.

Lastly, make sure your team knows the difference between strategy and tactics and why it matters.

Bottom(s) Up! How a Benefits Ladder Can Help You Get Your Marketing Right

Medtech companies, health insurers, and healthcare systems talk a lot about data. My belief is no healthcare executives, providers, or consumers really care about “data.” What they do care about is making good decisions that will measurably improve healthcare and health outcomes, and make or save money. And they see data as a means to those ends, a tool for making those things happen.

So how do you meaningfully connect data with decisions and decisions with outcomes? How do you work in the interim outcomes like improved workflow and increased productivity? How do you know which features and benefits to emphasize and which not to emphasize or even mention? How do you determine what elements to consider including in your value proposition?

One powerful technique we use to identify and prioritize benefits is laddering. We use it in deep dives with clients, and in testing or validating hypotheses during customer research.

Here’s how it works:

At the bottom of the ladder is the essential feature. At the top is the highest level benefit or result.

But first, let’s clarify the difference between features and benefits: Features=description. Benefits=satisfaction. Data is a feature. Good decisions, better workflow, improved quality of care – those are benefits. Those are results that provide satisfaction.

And there are different kinds of benefits (some overlapping): There are core benefits, functional benefits, aesthetic benefits, self-expressive benefits, emotional benefits, and more.

Benefits are what customers care about. But sometimes inside the company, executives, product managers, and marketing managers care more about features. That’s a problem that laddering can help ameliorate.

Here’s what a simple benefits ladder might look like for streaming analytics within health IT, to appeal to healthcare providers.

TOP

  • Improved Outcomes
  • Safer Patients
  • Enhanced Reputation
  • Better Care
  • Faster Decisions
  • Prediction
  • Analytics
  • Data

BOTTOM

Note that the core fundamental feature – data – is on the bottom. Just above that is the next level feature – analytics. Next we move up into benefits, starting with the functional benefit of prediction, which then leads to faster decisions. This set of four captures very concretely what the product is and does. And if we were to unpack these four further, we would get into workflow, efficiency, and productivity.

However as a set, the bottom four rungs on the ladder do not convey aspirations or emotions. And they do not express higher order benefits or results. For that, we need to go higher up the ladder.

A result of faster and therefore better decisions is better care. Which leads to multiple higher order benefits – like enhanced reputation, healthier patients, and better outcomes. And again, unpack these further and you’ll find patient satisfaction, HEDIS scores, etc. Some of these benefits may be produced concurrently, but for simplicity the ladder shows them in linear fashion.

When we go through this process in internal deep dives, we’ll invite clients to attach a heart to the one benefit they believe is the most compelling emotional hook for the product. For providers and streaming analytics… is it faster decisions, enhanced reputation, better outcomes? Is it improved workflow or its outgrowth, saving time?

The ladder they create and the emotional hook they select are well-educated hypotheses. We rely on the voice of the customer for validation or correction.

Bottom line, laddering is a great way to think through what your product or service delivers that matters to customers so you can improve your marketing. Do one for each of your main target audiences. When you do, you’ll notice the bottom rungs of the ladder are the same, it’s typically the higher order benefits that change.

Whether you’re bringing a new product or service to market or need to get better uptake with what you’re already selling, try laddering. It will enable you to transform your thinking, empathize with your customer point of view, inform your value proposition, and set yourself up for marketing success.

What’s your ladder??

Overcoming the CEO Attitude: “We’re So Good We Don’t Need Marketing!”

I was talking with a friend recently who heads up business development for a small technology development company that specializes in solving really complex engineering problems.

She faces a big and not uncommon challenge: Her leadership team has the unfortunate belief that a) because the company’s problem solving skills are so unique, and b) because they’re so good within their specialization, they don’t need to invest in marketing. By extension, the supposition is that customers must inherently understand what the company does and know why they’re the right choice. Therefore, the logic goes, the company doesn’t need to work on their marketing strategy, or brand positioning, or what their value proposition is. (Feedback to the contrary and underwhelming sale figures be damned!).

From an inside-in perspective– that is, how people within the company think about the company– the reasoning is understandable. From an outside-in or customer perspective, it is clearly and dangerously flawed thinking.

What to do about it?

First, let’s dive into the underlying dynamic. We all know there’s often conflict between engineers and marketers at technology companies. Engineers want to push the limits of that can be done with technology, while marketers want to focus on what customers want and will buy. When well-managed, the tension between these two equally important and valid perspectives can be productive and lead to significant and highly desired innovation.

But when a technology-centric mindset invades how company leaders think and how business development happens, it becomes a big problem. When this occurs, company culture evolves within an often unspoken and rather insidious “if we build it, they will come” philosophy. This myopic perspective leads CEOs to denounce the need for marketing, or for that matter to reject investing anything to understand what customers think and want.

There are three likely outcomes in this kind of scenario when management puts technology ahead of customers: 1) The company keeps doing what they’re doing and may show incremental growth (usually in fits and starts), but clearly fails to meet expectations, 2) The company stagnates and dies without ever getting to root cause, 3) The company suffers from underperformance until investors or other power brokers demand new leadership and a more customer-centric mindset takes hold.

The other and much less likely outcome is for the company to get lucky, hit a home run with a new technology, and win success in spite of themselves. This fairy tale ending happens just enough, and is so seductive, that it can sustain a CEO’s self-deception that the company does not need to put customers first and does not need real marketing strategy. It’s kind of like the allure of slot machines – maybe the next pull will hit the jackpot!

The good news is that there is a way (besides deep pain!) to overcome a CEO’s dismissal of marketing as an unnecessary investment and the corresponding presumption (i.e. hope) that customers will just “get it.”

It stems from an often overlooked common ground: Both engineers and marketers fundamentally believe that with the right tools, any problem can be solved. The key is to leverage this powerful and shared worldview. This can be accomplished in several ways that I’ll cover in detail in a future post. One of the most compelling is to set up experiments in which management a) hypothesizes what customers know, and b) commits to taking corrective action if their hypotheses are proven wrong. Then you do the customer research to confirm or correct the hypotheses and bring the results back to the team. This approach seems to bypass egos and importantly, reframes the problem in a way that better matches the CEO’s more technical mindset.

Tell us. How have you seen the problem of company leadership denying the need for customer-centered marketing strategy successfully overcome?

Developing Your New Market Entry Strategy: The 3Cs Framework

Imagine you’re a large medical technology company carrying a wide range of healthcare products. You see huge opportunity in a new market. How do you decide what innovation to lead with, what products to offer, and what your market entry strategy should be?three_c_V2

Here’s a framework that can help you narrow the universe of possibilities. We call it the 3 Cs, which stands for Company, Customer, and Competition. All three are critical factors that converge to reveal the sweet spot for market entry.

Company: This is often the starting point for med tech companies. They see a lucrative market, want a piece of it, and figure they have something good that will sell there. The driver is the company’s desire for growth and their belief in the solutions they offer. The “company” factor narrows the universe by identifying three things: 1) Core competencies and existing assets that can be leveraged for entry into a new market, 2) New competencies the company wants to develop, and 3) New care areas they want to expand into.

Customer: This is about identifying and understanding unmet needs and meaningful problems customers care about, as well as needs and problems they may not be aware of yet. The driver is what customers desire and will pay for. Determining these things requires being really tuned in to your customers. The “customer” factors narrow the universe by revealing 1) what customers want and need and will buy, 2) what their hidden desires and aspirations are and  what better state they envision, and 3) what customers don’t want, don’t value, and won’t pay for.

Competition: The competition factor focuses on identifying what customer needs are and are not adequately met by competitors, and what solutions you have that are already provided by others in the market you want to enter. The driver is finding an open niche of sufficient size for your innovation to take hold. Generally, companies will stay away from markets where there is domination by one or two competitors – unless they are willing to make a huge investment to unseat market leaders. The “competition” factors narrows the universe by specifying 1) where there is space for innovation, 2) what solutions exist and which are still needed, and 3) where there is good growth potential.

The danger is that the company’s hunger to enter a new market can lead to rash decisions and action without a guiding strategy. To mitigate that risk, give serious consideration to customer desire and to the competitive space. That way you avoid being driven by company solutions and wishes, rather than customer problems and desires.

What’s your experience developing new market entry strategy? What were your decision drivers? What lessons did you learn?

More resources:

How to Grow Your Business with Customer-Centric Innovation

How to Get to Breakthrough Innovation: Desirability First!

New Product Innovation: How to Determine the Winners