Strategy is not a to-do list!

Steve Blank says: One day I was having breakfast in Singapore with two of my former students who were launching a very exciting startup. They were deeply engaged in discovering their customers, and from among the thousands of customers they had talked to they were looking for answers for their strategy:

• Target customer

• Pricing

• Customer loyalty to the product

• And so on

Steve Blank says: I was not prepared for what they said, and I was shocked. They said they wanted a big launch and a big start for their product in 3 weeks.

I remember putting my coffee down on the table when I heard that.

I told them: Wait a minute — what about the rest of customer development? Don’t you want to get a few early customers and prove your assumptions?

They quickly replied that their investor had allowed them to skip this stage because they had put all the feedback they got from users into their work plan, and in the end their planning showed they could have a big launch in three weeks. Their investors were also worried about running out of cash and told them to stay on their plan.

Completely confused, I asked them: So which of these two things do you believe in? Customer development and discovery, or launching on a plan? They said they thought both were right.

Hearing that answer, I realized that they saw customer development as one item on a list of things they had to do.

Which strategy should we continue?

I remember when I was VP of marketing at Ardent, I had a painful experience of customer discovery. At that point in my life I was a smart, bold, young, technical marketer who had no idea what strategy was.

One day the CEO called me into his office and asked: “Steve, I’ve been thinking about our strategy for going to market. What do you think?” Then he laid out a complex, innovative sales and marketing strategy for the next 18 months.

I said: Yeah, that sounds good. Then he paused a little and said, what about this other strategy? I listened to a new strategy that was an alternative, and equally complex. When he finished he looked at me sharply and asked: So can you take both of these forward? I said of course.

He was just waiting for my answer

Twenty-five years later I still remember what happened. Instantly the temperature in the room dropped 40 degrees and the CEO started shouting. You’re an idiot! These strategies are pairwise incompatible. Executing both of them will take us out of the business and out of the market. You have no view or idea of marketing, which is your actual job, because all you do is pull a set of tasks off your to-do list. Without understanding why you want to do something. As VP of marketing you will be a dangerous person. In fact you are only a marketing manager for communications and planning, not a VP of marketing who sets strategy.

I left the room immediately. There is no doubt that my boss was an angry, inadequate person, but I did not grasp exactly what he meant.

I was a great marketer because:

• I took feedback from the company’s customers, then passed a list of features customers needed to the engineering team and said customers had asked for these features.

• I could execute any sales and marketing program that was given to me, no matter how complex.

I was busy doing a lot of work in my area of activity and responsibility. But why was I doing that work? My view of the work was a checklist I had to finish.

That is when a question appeared in my mind: What is the use of marketing in a startup?

Strategy is not a checklist of things that must be done; it creates the checklist.

It took me a long time to understand this, but I finally realized that the strategic part of my job had 2 layers:

1 We were still looking for a scalable, repeatable business model. My job was to test and examine assumptions about potential customers and their problems and needs.

2 After we found those customers, marketing’s job of putting together a technical plan to reach them begins (advertising, PR, trade shows, publishing specialized scientific articles, statistical reports, and so on) so we can bring customer need into our marketing channels and create ways to sell the product to them.

Once I understood strategy, I understood the meaning of a to-do checklist. Strategy allowed me to prioritize the work I had to do. By doing that prioritization I understood what the CEO meant by those two strategies being incompatible.

Those two students were engaged in customer development and discovery without understanding the purpose of the work. Maybe because customer discovery was one of the important trends in startups. Maybe because they had read my books. In fact, for them it was like one of the items on a checklist they had to complete. They had no deep understanding of why they were doing this work. Their situation was like standing in the middle of a crossroads. The investor had asked them to launch their product on a 3-week plan and enter the market quickly. But what happens to them if their assumptions are wrong?

The biggest lesson I took from this was: Don’t follow other people’s advice until you know why you should do that work.

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Written by Steve Blank, the father of modern entrepreneurship, ThinkGrowth