Ending the Love Affair with Strategy's Sacred Cows
Sacred cows more often than not, lead to a narrow and rigid approach to strategy that stifles the creativity, flexibility, and agility necessary to respond to a fast-paced business environment.
To be clear, sacred cows are not cash cows. The latter is a high-performing and profitable product / business unit that not only contributes to a company's financial stability, but typically often fund other areas of growth and innovation while requiring minimal investment for maintenance. The latter is a process, practice, product that is protected from scrutiny due to past successes / historical significance / sentimental value.
While every organisation has their unique herd of sacred cows, it it likely one of the following seven sacred cow can be found happily grazing in your organisational pasture.
❶ Growth at all costs - The pursuit of growth is often seen as the ultimate goal of a successful business, but this can lead to a short-term focus on revenue growth at the expense of long-term sustainability and profitability. Examples of companies that have profitably pursued degrowth strategies include Patagonia, Mondragon, and Basecamp. Read more about the difference between profit and growth here.
❷ A unique selling proposition is a prerequisite to growth - While having a unique selling proposition - understood as something that your competitor cannot and/or will not do - can be an advantage, it's not always necessary. Sometimes, being really good at what you do and providing a great customer experience can be just as effective.
❸ Market share is everything - Market share is often seen as a key indicator of success, but it's not always the most important metric. A smaller market share with high margins and customer loyalty can be just as valuable as a large market share with low margins and little loyalty.
❹ Innovation is the key to success - Innovation is important, but it's not the only driver of success. Sometimes, execution and operational excellence can be just as important as innovative products or services.
❺ Best practice is a kingmaker - There's no magic recipe. Best practices are like costumes - they fit some better than others. Context, not best practice, is the kingmaker.
❻ Can't grow without market research - Market research can provide valuable insights, but it's not always accurate or predictive, especially when the quality of question is meh. Sometimes, it's more important to experiment, test, and learn.
❼ Productivity is king - While important, it shouldn't come at the expense of flexibility, agility, or the ability to adapt to changing circumstances. Well documented examples of companies benefiting from "non-productive" time include 3M, Auchan, and Google.
If you see one of the above sacred cows in your pasture, it's time to ask yourself, "is it time to part ways?"
Yes, it is not easy. An organisation's relationship with its sacred cows can sometimes feel like a love affair - inexplicable and complex. Like most love affair, the beginning is "successful" and exciting. Then a comfortable routine is established. And as familiarity gradually makes the routine invisible, the protective instinct kicks in. Even when fracture lines start appearing as a result of environmental changes, the company may be unwilling to acknowledge the increasing tension, even when faced with failures. Because fundamentally, the fear of losing what we already have often outweighs the excitement of potential benefits.
So, how can an organisation part ways with its sacred cows? Connect with me to begin the conversation.
What to read next? Try Recipe For Strategic Disaster: Start With (?).
To be clear, sacred cows are not cash cows. The latter is a high-performing and profitable product / business unit that not only contributes to a company's financial stability, but typically often fund other areas of growth and innovation while requiring minimal investment for maintenance. The latter is a process, practice, product that is protected from scrutiny due to past successes / historical significance / sentimental value.
While every organisation has their unique herd of sacred cows, it it likely one of the following seven sacred cow can be found happily grazing in your organisational pasture.
❶ Growth at all costs - The pursuit of growth is often seen as the ultimate goal of a successful business, but this can lead to a short-term focus on revenue growth at the expense of long-term sustainability and profitability. Examples of companies that have profitably pursued degrowth strategies include Patagonia, Mondragon, and Basecamp. Read more about the difference between profit and growth here.
❷ A unique selling proposition is a prerequisite to growth - While having a unique selling proposition - understood as something that your competitor cannot and/or will not do - can be an advantage, it's not always necessary. Sometimes, being really good at what you do and providing a great customer experience can be just as effective.
❸ Market share is everything - Market share is often seen as a key indicator of success, but it's not always the most important metric. A smaller market share with high margins and customer loyalty can be just as valuable as a large market share with low margins and little loyalty.
❹ Innovation is the key to success - Innovation is important, but it's not the only driver of success. Sometimes, execution and operational excellence can be just as important as innovative products or services.
❺ Best practice is a kingmaker - There's no magic recipe. Best practices are like costumes - they fit some better than others. Context, not best practice, is the kingmaker.
❻ Can't grow without market research - Market research can provide valuable insights, but it's not always accurate or predictive, especially when the quality of question is meh. Sometimes, it's more important to experiment, test, and learn.
❼ Productivity is king - While important, it shouldn't come at the expense of flexibility, agility, or the ability to adapt to changing circumstances. Well documented examples of companies benefiting from "non-productive" time include 3M, Auchan, and Google.
If you see one of the above sacred cows in your pasture, it's time to ask yourself, "is it time to part ways?"
Yes, it is not easy. An organisation's relationship with its sacred cows can sometimes feel like a love affair - inexplicable and complex. Like most love affair, the beginning is "successful" and exciting. Then a comfortable routine is established. And as familiarity gradually makes the routine invisible, the protective instinct kicks in. Even when fracture lines start appearing as a result of environmental changes, the company may be unwilling to acknowledge the increasing tension, even when faced with failures. Because fundamentally, the fear of losing what we already have often outweighs the excitement of potential benefits.
So, how can an organisation part ways with its sacred cows? Connect with me to begin the conversation.
What to read next? Try Recipe For Strategic Disaster: Start With (?).