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Tony Hsieh’s Strategic Pattern

As many of you know, we recently said goodbye to an amazing leader, former CEO of Zappos, Tony Hsieh. We learned many lessons from Tony, the most important one being that the key question in strategy is to ask, “What business are we really in?” On Zappos’ success, he told us, “We were doing pretty well as a shoe company, but our growth really took off when we realized we’re a customer service company that happens to sell shoes.”

Keep reading to discover three free resources to help you answer this essential question and set your 2021 strategy.

Peter Drucker highlighted this principle when he said, “‘What is our business?’ is almost always a difficult question which can be answered only after hard thinking and studying. And the right answer is anything but obvious.”

Strategy comes down to finding the answer and making decisions consistent with what business you are in. I give more examples in this free webinar.

How Microbreweries Get Customers to Drive 100 Miles

This year my family spent Thanksgiving in Louisiana. During the trip, a friend from home asked me to pick up some of his favorite beer from a microbrewery a couple hours outside of the city. I found myself journeying past swamps, farms, and alligators to visit the brewery and fulfill his request.

If he were simply looking for beer, my friend could have stopped by his local grocery store, but this craft brewery promised something more specific. Customers buy from microbreweries because they want uniqueness, local custom, and quality that is not watered-down by mass production. The hundred-mile quest for my friend’s favorite brew was not only a search for beer, but for a reminder of the taste and culture of Louisiana.

In our latest Insight to Impact Adventure, Seeing Around Corners, Rita McGrath discusses how this insight into what customers really like about your product or service will help you develop a strategy that positions you for success in an uncertain future.

If you want to learn how to identify critical needs that will motivate your customers to drive hundreds of miles to find you, join our I2I Adventure with Rita McGrath. Use code OUTTHINKER39 for a free $39 Traveler ticket (or $39 off any other ticket).

Micro-factories and Proximity

Just like microbreweries compete with their big name counterparts by meeting customers closer to the point of demand, Arrival, a UK-based electric vehicle manufacturer, is planning to produce customized commercial vehicles in “micro-factories”. These factories allow for design customization and require less capital to set up and scale locally. The company has proven its ability to meet customer requests by logging its first order from UPS at $1.2 billion for custom vehicles. As you design your 2021 strategy, ask, “How can we win through proximity to our customers?”

The examples of Zappos, microbreweries and micro-factories show us the power of organizations who are listening to customer needs and remaining agile to pivot quickly in response. Learn more about becoming agile by joining me for the 25th Human Resources Summit: How to be Agile without being Fragile. As a member of the Outthinker community, you can register free of charge with the code OUTTHINKER25.

Three Strategic Questions and Next Steps

To make 2021 a great year, ask:

  1. “What business are we really in?” Sign up for my free webinar and if you want to learn more, consider joining the full course, which kicks off later this month.
  2. “What need will make customers drive 100 miles?” Join our I2I Adventure (use code OUTTHINKER39 for a free $39 ticket).
  3. “How can we win by delivering value closer to customers?”

Photo by Skitterphoto from Pexels

“8Ps” of StrategyOpportunity
for Disruption
Recommended Leverage Points
Position- The farmers, individual and corporate, that you are targeting.

- The need of the agricultural industry that you seek to fill.
3- What technologies do you control that can help you tap into market
segments that you previously thought unreachable?

- What are the potential business alliances you could think about with key players in the segment to serve your customers with integrated solutions? (Serving customers with more integrated solutions example: serving farmers with fertilizers, crop protection and other).
Product- The products you offer, and the characteristics that affect their value to customers.

- The technology you develop for producing those products.
8- What moves are your organization taking to implement Big Data and analytics to your operations? What IoT and blockchain applications can you use?

- What tools and technology could you utilize or develop to improve food quality, traceability, and

- How can you develop a more sustainable production model to accommodate constraints on arable

- What is the future business model needed to serve new differentiated products to your customers?
Promotion- How you connect with farmers and consumers across a variety of locations and industries.
- How to make consumers, producers, and other stakeholders aware of your products and services.
8- How are you connecting your product with individual and corporate farms who could utilize it?
- How could you anticipate market and customer needs to make customers interested in accessing your differentiated products?
PriceHow consumers and other members of the agricultural supply chain pay for access to agricultural products.7- What elements of value comprise your pricing? How do each of those elements satisfy the varying needs of your customers?
Placement- How food products reach consumers. How the technologies, data, and services reach stakeholders in the supply chain.9- What new paths might exist for helping consumers access the food they desire?
- How are you adapting your operations and supply chain to accommodate consumers’ desire for proximity to the food they eat?
- How could you anticipate customer expectation to make products more
accessible to customers/agile supply chain?
- Have you considered urbanization as a part of your growth strategy?
- How your food satisfies the needs and desires of your customer.
- How the services you provide to agribusiness fulfill their needs.
9- Where does your food rate on a taste, appearance, and freshness
- Could the services you provide to companies and farms in the agriculture industry be expanded to meet more needs?
- What senses does your food affect besides hunger? How does your
customer extract value from your food in addition to consumption?
Processes- Guiding your food production operations in a manner cognizant of social pressure.8- How can you manage the supply chain differently to improve traceability and reduce waste?
- How can you innovate systems in production, processing, storing, shipping, retailing, etc.?
- What are new capabilities to increase sustainability (impact on the environment, or ESG) components?
People- The choices you make regarding hiring, organizing, and incentivizing your people and your culture.- How are you leveraging the agricultural experience of your staff bottom-up to achieve your vision?
- How do you anticipate new organizational capabilities needed to perform your future strategy (innovation, exponential technologies needed, agile customer relationship, innovative supply chain)?
- How do you manage your talents to assure suitable development with exposure in the agrifood main challenges/allowing a more sustainable view of the opportunities/cross-sectors?