You always suspected it, and I’m here to tell you it’s true.
The art of general management and strategic consulting lies in the mastery of a few simple tools. Now, despite the inevitable threats against my person made by parties who do not want to see the Truth revealed, I am about to share with you, Trust Matters readers, the Three Strategic Secret Sauces. Guard them carefully.
Secret Sauce One: The Rule of the Axes.
Short form: Draw two axes. Now decide what to label them.
You’ve seen this rule before, though perhaps you never noticed it for what it was. Consider:
- • The Laffer Curve: tax rates by governmental revenue
- • The classic Business Barnyard Matrix: market share by growth rate of a business
- • Newspaper headline font levels on disaster stories by distance between the paper’s home town and the location of the disaster
- • New York Magazine’s Approval Matrix (highbrow/lowbrow by brilliant/despicable)
Why is the Rule of the Axes such a hit? Because it simplifies complexity, immediately giving the axes-author the appearance of wisdom.
(Close cousins: Occam’s razor, and the rule of “always use 3-4 bullet points”)
Secret Sauce Two: The 80-20 Rule.
Short form: Look for concentration—in anything.
Classic formulations of the 80-20 rule include:
- • 80% of the revenue/profit comes from 20% of the clients
- • 80% of the taxes are paid by 20% of the citizens
- • 80% of the crimes are committed by 20% of the population
- • 80% of the Ivy League admissions come from 20% of the population
The 80-20 rule works because it forces the mind toward points of leverage. A good strategist always looks for maximum effect with minimum resources—just like a military general, or a change manager. (Note: it doesn’t have to actually be 80/20, in fact it rarely is. Anywhere above 60/40 can work.)
Secret Sauce Three: Vicious and Virtuous Circles.
Short form: Find what works, or doesn’t; add a few interim steps, draw them in a circle to make it appear permanent.
Here are some examples:
- • Parental abuse drives fear, which drives aggression, which drives pre-emptive defense, which drives abuse
- • US auto companies give up low-margin segment, which drives market share for low-margin Asian competitors, which increases their volume, which lowers price, which lowers margins, which causes US auto companies to give up the next-lower margin segment
- • You empower what you fear
- • The fastest way to make a man trustworthy is to trust him.
The Circles are powerful because they force us out of traditional linear models, and because they make sense of what often appears contradictory. The Circles offer a narrative, and usually suggest points at which to intervene to change the narrative. They also sound amazingly like rules and laws of nature, even when they’re bogus.
So there you have it. And guess what:
- • If you chart usage of these three tools against business success, you’ll find a clear correlation;
- • In fact, 80% of general management and strategic consulting goes to the 20% who have mastered these three tools;
- • The more these three tools get used, the better known they get, the more clients learn to recognize excellent tool mastery on the part of consultants, the more they get hired for excellent use of these three tools, and the more they get used.
Now you too can be quoted, command high rates, and gain that aura of the oracle that surrounds the Great Strategists. Just use the three tools.
Your financial tokens of gratitude for this revelation may be sent to me at trustedadvisor.com. Credit cards and PayPal are accepted. You’re welcome.