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Article
How to confront uncertainty
in your strategy
Article - McKinsey Quarterly
The halo effect, and other
managerial delusions
Article - McKinsey Quarterly
Strategy to beat the odds
Article - McKinsey Quarterly
Eight shifts that will take your strategy into high gear
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Take a fifty-minute deeper dive
Now that you’ve
read the Five …
Article - McKinsey Quarterly
Eight shifts that will take your strategy into high gear
Dive deeper
Dive deeper
Test the plan by breaking your strategy into six-month increments: if the first step isn’t doable, the rest of the plan is bunk.
Take the
first step
Discard “base case” assumptions that veil unrealistic aspirations. Instead, presume the business’s current performance will continue, then find the strategic moves needed to change that trajectory.
Go
baseless
To shift resources to
the best opportunities, develop a detailed curve of 50 or so specific, investible opportunities one level down from the business unit.
Dig
deeper
Force discussion about combinations of moves and scenarios with different levels of resources and risk.
Make
choices
Ditch the annual for
a rolling planning process that checks assumptions, revisits context, and refreshes strategy.
Roll
with it
Take the
first step
Go
baseless
Dig
deeper
Make
choices
Roll
with it
Does your strategy embrace those long odds, and the uncertainty they imply?
If not, revisit the way you make strategy in the first place.
Rethink it
Article - McKinsey Quarterly
Strategy to beat the odds
Dive deeper
Dive deeper
Moved
to bottom quintile
Moved to top quintile
Middle quintiles, economic profit
Economic profit: % of companies that exited middle 3 quintiles
Playing the probabilities means understanding the odds of success. Just 1 in 12 companies manages to jump from the middle to the top quintile of performance.
The 8 percent
Article - McKinsey Quarterly
The halo effect, and other managerial delusions
Dive deeper
Dive deeper
Robert E. Rubin
“
Once you’ve internalized the concept that you can’t prove anything in absolute terms, life becomes all the more about odds, chances, and trade-offs.”
But former US treasury secretary and Goldman Sachs executive Robert E. Rubin advises us to embrace probability rather than avoid uncertainty.
That’s life
Article
How to confront uncertainty in your strategy
Dive deeper
Dive deeper
We pretend to deal with it
When strategists actually discuss scenarios, they usually select one as the “base case,” and that’s the end of the debate.
We treat it as
an afterthought
Just look for the slide called “Potential risks and how to mitigate them” on page 149 of a 150-page deck.
We ignore it
“I can’t handle multiple realities,” one CEO said. “I’d rather pick the world I live in.”
We pretend to deal with it
We treat it as
an afterthought
We ignore it
“Predictions are difficult, especially about the future,” quipped Yogi Berra (and, before him, physicist Niels Bohr). Maybe that’s why most of us avoid uncertainty instead.
Avoidance
A quick briefing in five—
or a fifty-minute deeper dive
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Good strategists manage uncertainty by playing the probabilities. But most of us use wishful thinking instead.
Confronting uncertainty
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