Identifying the challenges and obstacles between your current state and your long-term vision is critical in strategic planning. Breaking down the journey into smaller, incremental, solvable challenges makes achieving the long-term vision more manageable, measurable, and likely. Companies ensure they steadily move closer to their envisioned future by tackling these challenges in the proper order with the right urgency.
The goal is mapping the path by identifying incremental challenges in achieving progress toward your vision.
Understanding the Landscape
If you don’t already have this, revisit the current operational, market, and competitive landscapes captured when creating the vision statement. Understand where you stand related to your vision regarding resources, market position, technological capabilities, and customer perceptions. This baseline understanding is crucial for identifying the gaps that need to be bridged.
Write down these assumptions, hypotheses, and beliefs. These will evolve continuously. The dysfunction of yearly analysis is its inability to cope with new information about the landscape as we learn and discover our beliefs were “less than correct.”
Break Down the Vision into Key Challenge Areas
Segment your long-term vision into key focus areas, for example, technology development, market expansion, customer experience, operational efficiency, and company culture. This segmentation allows for a more focused approach to identifying challenges and setting goals.
If you are operating a product company, the David Maclure pirate metrics can help identify the key areas that need simultaneous attention. Although intended to be metrics, they are also suitable for challenge areas in general for product and service companies:
Acquisition: Challenges in acquiring new customers
Activation: Challenges in getting people looking at your products, using and buying it
Retention: Challenges in getting customers to continue to use and pay
Referral: Challenges in getting customers to tell others
Revenue: Challenges in keeping and growing revenue
Having at least one challenge addressing each of these categories is the first goal for most product-led companies.
Identify Challenges and Obstacles
Identify specific challenges teams must solve for each key area to progress toward your vision. Challenges are obstacles between “now” and the “vision” of being successful. In the book Good Strategy, Bad Strategy, Richard Rumelt notes that bad strategy is often aspirational, a set of good things. This type of strategy doesn’t cause change. At some point, if those aspirations are universally deemed good, why haven’t we done it yet? Good strategy asks that exact question: why haven’t we achieved that yet? These are challenges and are the basis of a “challenge-based” strategy. Challenge-based strategy uncovers problems, and these challenges need to be solved – they turn aspirations into actions (or the ideas that lead to action).
For each of the challenge areas listed above, challenge your company and yourself to think about what is between now and progress towards the vision.
Clean questions help people clarify thoughts, feelings, and the details of situations without leading the respondent or adding the questioner’s assumptions. Here are some clean questions that could help facilitate challenge exploration:
- What changes would need to happen for [x] to happen?
- This question helps identify specific alterations in the current model that are necessary to align with the future vision.
- What obstacles could prevent [company, product, service] from becoming …?
- Identifying current barriers can help strategize how to overcome them.
- What would [we] need to learn to become … in … years?
- This question focuses on knowledge gaps or new competencies that teams and people need within the organization.
- What do we not know yet that is critical to this vision?
- Identifying unknowns helps in focusing research and development efforts effectively.
- What steps would [company] need to take in the next one, three, and five years to align with this vision?
- Helps in creating a roadmap with short, medium, and long-term goals.
- What impact would this change have on [company] existing business model?
- Reflecting on the impact helps assess the readiness and resilience of the business against the required transformation.
Prioritize Challenges
Not all challenges are of equal urgency or importance. Prioritize them based on their impact on your vision, the feasibility of overcoming them, and the effort needed to progress. By asking a wide audience for challenges, you will end up with a pretty sizable and scary list, both a positive and a negative. It is better to have identified a challenge than blindly stumble into it later.
Prioring these challenges doesn’t have to be exact. At this stage, there is so much speculation that near enough is the best anyone can hope for. There are three factors to consider:
Impact: The likely impact on progress towards the vision.
Confidence: The confidence that solving this challenge will lead to the impact speculated.
Effort: The effort involved relative to other challenges you could solve (some call this Ease).
A simple 5-point qualitative scale (low, low-medium, medium, medium-high, high) for each factor is enough to avoid missing anything urgent or opportunities too good to miss. The goal is quickly sorting the challenges from most to least critical.
This prioritization scheme is called ICE. In general, it combines and balances these three factors into a score using the general formula:
Priority = (Impact x Confidence) / Effort
This formula aims to choose the highest, most confident, and easiest challenges first. It is not exact, but it approximates and offers a way to quickly identify the diamonds in the rough.
Summary
A company’s journey towards a long-term vision has numerous challenges, each presenting an opportunity for growth and progress. By identifying, prioritizing, and methodically addressing these challenges, companies can ensure a steady advance toward their envisioned future. This strategic approach brings clarity and direction to the journey and fosters a culture of continuous improvement and resilience against unforeseen obstacles.