Thinking strategically by asking Why and How
“How do I develop my strategic thinking?”
This is a question I’ve wondered for many years and often get asked by junior PMs. It is an intangible concept that non-traditionally-MBA-trained product leaders tend to struggle with.
To me, strategies are just solutions to problems. And any solution can be labeled as a “strategy” once its scope includes understanding of competitors and the tactics to beat them. So if you are a PM aspiring to think more “strategically,” try this simple exercise of asking “why” to everything you do.
Let’s say you are the Checkout PM at an online furniture marketplace and you’ve been asked to integrate Apple Pay. Start by asking yourself: why do we need Apple Pay?
Answer: users are dropping off at the payment step of checkout on iPhones because they don’t want to spend the time to enter their credit card info.
Ok, so this integration project is a product solution that helps reduce friction with online payment.
At this point, you understand how to apply product solutions to solve user problems, but still not how to think strategically. So don’t stop there, ask “why” again: why do we need to collect payment and have a checkout at all?
Answer: users don’t want to just find vintage / antique furniture online, they also want to buy it online instead of going to stores.
Now we are getting to strategy! Having Checkout on a furniture listing site is a product strategy that helps beat competitors: facilitating e-commerce is a competitive advantage over Craigslist and individual antique dealer homepages.
Keep going! Ask yourself “why” one more time: why does our site exist at all?
Answer: people want to find and buy the most iconic vintage / antique furniture online.
Now we are getting into the minds of business executives and investors. Creating a marketplace where antique dealers around the globe can sell directly to customers in another part of the world is a business opportunity, not currently fulfilled by Amazon and poorly by eBay. This marketplace creates value for both the dealers (helps find new customers) and the buyers (helps find furniture) and in turn you can charge one or both parties for that value.
Voila! From a simple Apple Pay project, you have derived an entire strategic thought process. Bonus points also for understanding how your work fits into the larger vision of your company.
This exercise should help you flex your “strategic thinking” muscle and overtime, you’ll be able to quickly unravel the larger strategy behind any feature change.
“How do I create my own strategy from scratch?”
At some point in your PM career, you’ll be asked to create your own product/business strategy. Before you reach that point, practice this exercise where you ask “how” to all of your product / business ideas to develop your creativity.
Suppose you want to build the best online antique furniture purchasing destination.
Start by asking yourself: how will this website become the best one, versus all the other competitors?
Answer: provide the fastest and cheapest shipping for antique furniture.
Ask “how” again: how will my business provide the fastest and cheapest shipping?
Answer: build a proprietary global shipping network that is better optimized to deliver antique furniture than any existing shipping carrier.
Let’s keep going: how will I create that shipping network?
Answer: consign inventory from antique dealers and hold them in warehouses around the world, negotiate down carrier costs via outsized shipping volume and supplement reach in remote areas with my own fleet of delivery trucks.
And so forth. Repeat to achieve the granularity of the answer you want. Obviously, this is just a back-of-the-envelope brainstorming exercise to stretch your thinking, to actually create a practical strategy worth investing in requires much more diligence and research.
Curious to learn more? Try these sources:
- https://stratechery.com/— a popular blog that dissects the business strategies of tech companies.
- Good Strategy / Bad Strategy — good primer in business strategy
