5 Slides to Win

《Winning》by Jack Welch

The first step of making strategy real is figuring out the big aha to gain sustainable competitive advantage—in other words, a significant, meaningful insight about how to win. To do that, you need to debate, grapple with, wallow in, and finally answer five sets of questions.

Slide 1: What the Playing Field Looks Like Now?

· Who are the competitors in this business, large and small, new and old?
· Who has what share, globally and in each market? Where do we fit in?
· What are the characteristics of this business? Is it commodity or high value or somewhere in between? Is it long cycle or short? Where is it on the growth curve? What are the drivers of profitability?
· What are the strengths and weaknesses of each competitor? How good are its products? How much does each one spend on R&D? How big is each sales force? How performance-driven is each culture?
· Who are this business’s main customers, and how do they buy?

Over the years, I have been amazed at how much debate this simple grounding exercise can spawn. In fact, it’s not unusual for people who share the same office space to have widely different views of the same competitive environment. Many people have a terrible time admitting their business is a true commodity.

Another of the many important issues this slide surfaces is market size. Too often, people like to call themselves the market leader, so they end up limiting the scope of their playing field to make that happen. In our case, the No. 1 or No. 2 mantra inadvertently had that exact effect. After more than a decade, we realized that businesses were increasingly tightening their overall market definition so that their shares were enormous.

We fixed that by saying that businesses had to define their market in such a way that their share of any market they were in could not be more than 10%. With that restriction, people were forced into a whole new mindset, and opportunities for growth were suddenly everywhere.

Slide 2: What the Competition Has Been Up To?

· What has each competitor done in the past year to change the playing field?
· Has anyone introduced game-changing new products, new technologies, or a new distribution channel?
· Are there any new entrants, and what have they been up to in the past year?

Slide 3 What You’ve Been Up To?

· What have you done in the past year to change the competitive playing field?
· Have you bought a company, introduced a new product, stolen a competitor’s key salesperson, or licensed a new technology from a startup?
· Have you lost any competitive advantages that you once had—a great salesperson, a special product, a proprietary technology?

The comparison of slides two and three tells you if you are leading the market or chasing it. Sometimes these two slides show you that your competitors are doing a whole heck of a lot more than you are. You’d better find out why.

Slide 4: What’s Around the Corner?

· What scares you most in the year ahead—what one or two things could a competitor do to nail you?
· What new products or technologies could your competitors launch that might change the game?
· What M&A deals would knock you off your feet?

Most people answering this set of questions underestimate the power and capabilities of their competitors. Too often, the assumption going in is that competitors will always look the way they do in slide one—they’ll never change.

Getting the right strategy means you have to assume your competitors are damn good, or at the very least as good as you are, and that they are moving just as fast or faster.

When it comes to peering into the future, you just can’t be paranoid enough.

Slide 5: What’s Your Winning Move?

· What can you do to change the playing field—is it an acquisition, a new product, globalization?
· What can you do to make customers stick to you more than ever before and more than to anyone else?

This is the moment to leap from analysis to action. You decide to launch the new product, make the acquisition, double the sales force, or invest in major new capacity.

By the time you’ve finished this set of questions, the effectiveness of your strategy should be pretty clear. Your big aha is winning, or it needs to change. Even if you didn’t have a strategy before, this process should help you get one.

But either way, you’ve only just begun.