Which Hard Problem?
There are lots of hard problems to solve. But choosing the right one to tackle during a strategic quagmire is hard. You need a wide-angle lens and a microscope.
👋🏻Hi. Amié here. Welcome to Beyond Better Blog. Every other week or so I share new ways of thinking about strategy, leadership and management to help you become an extraordinary founder, leader or contributor.
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Which Hard Problems
Every organization must choose which problems to solve now, later, and … maybe never. Often, the temptation is to go for the easiest win. And there are times when that makes sense—like when morale is low and the team needs to build confidence.
But low-hanging fruit rarely proves to be the most consequential or strategic problems to solve.
The Problem with Hard Problems
It isn't only low-hanging fruit that creates dilemmas. Long-term, challenging projects are hard—and in a chaotic environment, it's tough to know whether the finish line will come fast enough for the effort to pay off.
The hardest problems come in many forms. Some are worthy of the outsized investment they demand. But it's not easy to know which those are, and which will merely cannibalize resources from something more critical.
Nokia Decides To Not Decide
During the initial explosion of smartphone technology in the early 2000s, Nokia was the incumbent player with a lion's share of the market. But even in 2008, their Symbian operating system couldn't match the flexibility that iOS and Android were already demonstrating.
They had been working on their own new OS, MeeGo, to replace Symbian. But it had been plagued by developmental delays. They simply persisted.
MeeGo OS was finally released in 2011—well past the point at which it could possibly overtake Apple—especially since it was an underwhelming product.
It was too little and MUCH too late. The market had shifted. Android and iOS owned it.
Nokia made a last-ditch attempt to switch to Microsoft's mobile OS—but Microsoft had also missed the boat.
Ironically, in 2005, Nokia had released the N770, a tablet that ran on their Maemo OS, which was Linux-based. While it was less robust than an iPhone would be, it had the basic components, including a browser, email, and much more. It didn't get a great reception, but it was a strong start.
When the iPhone launched in 2007, Nokia was still the leader in mobile phones. But the iPhone gathered steam quickly. The most obvious signal was the rush of developers building for Apple's App Store.
Within 18 months there were over a billion downloads. Nokia had an App Store—after a fashion. But Nokia apps were primarily wallpaper and ringtones. iPhone users had a growing number of full-function, robust apps with a huge variety of functions. That created a virtuous cycle of more developers building for iPhone and Android, while Nokia found it harder to attract any.
Nokia wasn't blind to the changing market. They knew the numbers for both Apple and Android.
Wide Angle
Between 2007 and 2009, Nokia had options and might have become the third player in the smartphone ecosystem.
At that time, both Apple and Android were nascent. And each had significant challenges:
In the US, iPhone was only available to AT&T customers.
Android's UI was extremely rough.
The developer community was just beginning to program for mobile and was agnostic. Given comparable technology, they would have developed for Nokia too.
Nokia could have done any number of things:
They could have doubled down on their Maemo OS, and modified it for a phone. Their large carrier network would have led to competitive market penetration.
They could have put all their resources into the MeeGo OS—the intended replacement for Symbian—hired better product leads and accelerated the slow development process.
They could have partnered with other hardware manufacturers and provided their Maemo OS in a joint venture (as Android did).
They could have partnered with Google or Apple to manufacture hardware for them.
There were likely many other possible strategic pivots they could have made. But each one would require choosing the right hard problem and then focusing on it.
Instead, they attempted to do several very hard things at once. Unsurprisingly, none went well.
The calculus is emotionally hard. But it isn't statistically difficult.
Betting it All
In hindsight, we can see that Nokia should have chosen a different approach. But whichever they chose would have been a huge bet.
Huge bets come with high risk.
But achieving something extraordinary can't happen without a massive investment of energy and focus. And attempting to hedge amid a huge strategic inflection point is asking for a slow death.
That's hard to absorb in the moment, and the pressures are daunting.
"…a Counter-Positioned incumbent comes under tremendous pressure to do something; at the same time, they face great pressure to not upset the apple cart of the legacy business model. A frequent outcome of this duality? Let's call it dabbling: toe in the water, somehow, but refuses to commit in a way that meaningfully answers the challenge." [Hamilton Helmer]
Nokia led the field as the incumbent. When they faced challenges from Apple and Google, they did exactly as Helmer describes—they dabbled.
Levels of Magnification
Is there a way that Nokia (or you and I) can approach these dilemmas and make better decisions about which problem to attack?
It pays to change perspective and look at the issues from more than the weedy close-up angle.
Zoom out to 30,000 feet or 25 years. Use all the data available to consider the market, your customers, and the position your project occupies from that distant perspective. [Click to tweet]
Nokia didn't. While they were still viewing the world through the map of 1999, the world had progressed.
If they had taken 20,000 steps back and looked at the landscape through fresh eyes, they might have more clearly seen the danger looming. They had the same information that you and I have now. But because they were looking at it through the lens of their domination, they couldn't see the reality.
We can see their dilemma more clearly now, not just because we have hindsight, but also because we are looking at it through a wide-angle lens.
I thought this Gary Larson cartoon captured it well!
AI Strategist?
From far enough away, Nokia could have understood the entire state of play. They needed to see the relative positions of every player and their roadmaps.
But looking at the "big picture" isn't enough to identify which gnarly problems to solve.
Sometimes, we need to look more closely—through a microscope.
One of the big debates going on right now is the extent to which AI can produce strategy.
If strategy is nothing more than looking analytically at the big picture—assessing the macroeconomics, competitive landscape, technological progress, and projections about all of it—then yes, AI can do that.
Here's the rub.
Without the microscopic view, it's impossible to identify the best possibilities—and more importantly, the most wicked threats.
Often, when strategies fail, it is because of those granular details, not because the macro plan was wrong. But the granular details tend to be harder to access without human-level observation and experience.
Microscopy
When Lou Gerstner became IBM's CEO in 1993, most strategic analysis focused on IBM's declining hardware margins and software competition. That was the macro view, and it seemed to imply a need for new products or customers to produce higher margins.
But, prior to that moment, Dennie Welsh had been running IBM's Integrated Systems Services Corporation (ISSC). In 1992, they landed their biggest contract—the outsourcing of all of Sears' data center operations.
During Gerstner's first private meeting with Welsh, Welsh shared some insights about what he saw was possible in the Sears contract—and possibly in many future contracts.
One source of his insight came from his observations of IBM sales associates. They were more than just account managers. They were also confidantes and technical advisors.
Welsh could see IBM running every aspect of an enterprise's IT infrastructure. Gerstner had been mulling something similar. But from the outside, it was impossible to understand how seamless such a pivot could be.
That insight became the foundation for IBM Global Services. During Gerstner's tenure, it became IBM's largest and most profitable division, helping to take their market cap from $29 billion to $168 billion.
It took looking at the human side to see exactly how IBM worked with its clients—and how clients were experiencing the rising role of computers in their enterprises. At 20,000 feet, that was invisible.
Human Hearts
These microscopic items can also kill a company. A client company of mine was led by two founders, one of whom had coded the software product 20 years earlier, in UNIX.
At the time they founded the company, it offered an extraordinary breakthrough in productivity to their customers. That edge lasted 19 years. But as cloud computing and SaaS gained currency, the UNIX-based product lost market share. First slowly, but then fast.
The long-term strategy that I had helped their team create called for a complete reinvention of the product—with a game-changing approach that would eclipse every existing rival.
The roadmap was created, and the outside engineering firm had begun to release the beta.
But when it finally came time to start deprecating the old system, the founder became oddly obstructive. He hid passwords, disabled systems, and was too "busy" to meet.
When the company was acquired by private equity (for cheap) a year later, the old product was still in use.
I had noticed how attached he was to his creation early in our work together. But as the strategy got underway and the engineers began releasing the new product, I felt like my fears were misplaced. I was shocked when I saw how well he scuttled the strategy.
Long, Short, Far, Close
Take advantage of every level of magnification and microscopy. The different perspectives we get by seeing things from great distance and high magnification deliver unexpected strategic insights. But they also act as a fine measure of worth.
Take the historical view of whatever you are most concerned about right now. When seen from the vantage point of 30 years in the future, is solving it trivial or a breakthrough?
At the same time, scrupulously sweat the small stuff. Is there a hitch in the spokes that seems too innocuous to fret over? What mischief could occur if you ignore it?
These two very different ways of seeing can transform your strategy and your enterprise.
Thanks,
Amie’
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Well said - that ability to zoom in and telescope out is critical to great strategy. But it's hard to bring off.
Sometimes I think it's just a matter of luck, but a structured process can improve the odds that the process is rigorous, and more likely to yield breakthrough thinking.