Good Strategy Bad Strategy 06: Using Leverage (Richard Rumelt)

Good strategy discovers or creates power, and then applies it where it will have the greatest effect. 

We use policies, actions and resources to maximize our chances of winning, while constraining the powers of our competitors. 

Strategy focuses resources, actions and policies on a select few objectives that will help us win. The secret of a winning strategy is finding the sweet spot where applying a small amount of leverage will result in the greatest outcomes.

Anticipation:

Strategy is not just based on your own actions, but also in anticipating how the environment around you will react, customers, competitors, legislation, etc.

Always think about, plan for, and prepare for things to not work out the way you anticipate. Whether that means developing backup plans or rolling back the changes you've just made. The warns against using lazy methods when doing strategy work. In your scenario planning, avoid creating graphs with three lines labeled high, medium and low, and then planning for medium chaos, medium profitability, or medium uptake of your new offer. Rather plan for what happens when the uptake starts high and then suddenly drops to lower than low. Do you have enough in the tank to keep going? Do you have enough reserves to recover?

Rumelt says, "Anticipation simply means considering the habits, preferences and policies of others, as well as various inertias and constraints on change."

"To achieve leverage, the strategist must have insight into a pivot point that will magnify the effects of focused energy and resources."

He goes on to say that, "A pivot point magnifies the effect of effort. It is a natural or created imbalance in a situation, a place where a relatively small adjustment can unleash much larger pent-up forces."

Much like the saying, "A chain is only as strong as it's weakest link." Find the weak spot and attack it. 

Focusing efforts on a narrow set of objectives usually generates larger payoffs. This kind of focus or concentration is always necessary in strategy, unless you have unlimited resources to waste. 

Sometimes a minimum amount of effort or investment is required. Anything less than that will just be a waste of time. Rumelt makes the example of such threshold effects in advertising, citing that a very small amount of advertising will produce no result at all. You must first get over the threshold if you wish to see any returns at all. So, if your budget is tight, you may want to roll out your new products region by region, and only advertising in the new territory you've just entered. Adopt a plan that delivers a clear benefit to a small segment, instead of benefits that are spread thinly over a larger segment. 

And there you have your answer. Multitasking is not effective. Concentrate and focus your efforts on a particular activity until it's done. Until you can point at something that is fully completed and ready to be sold, versus many things that are half done and can't be sold.