by: James Young
A Guide to Strategic Advantage for Associations and Nonprofits
This article provides an overview of a popular and widely applicable strategic framework called Integrated Cascade of Choices from the book Playing to Win: How Strategy Really Works by Roger Martin and A.G. Lafley.
The framework is flexible enough to be used association-wide, at the unit level (membership, learning, etc.), for an entire product portfolio, or for individual products (annual conference, publication, or course offerings).
Similar to our recent article on the concept of product, the word winning is not always a word that works for associations or nonprofits. It can convey impersonal business practice from bottomline-focused corporations.
I argue that creating a unique, airtight value proposition helps position our associations for distinctiveness, success, and growth. As I discussed in my article on positioning, winning is making bold choices to achieve superior positioning in a crowded marketplace.
And strategy is absolutely something that associations and nonprofits can do with success.
The Product Community is a product development learning community designed specifically for associations.
Why Associations Need Strategy
“Strategy is the answer to the question, “how are we going to become and remain unique?”
Investing in strategy is crucial for associations because it provides clarity of identity and a specific roadmap for achieving outcomes and staying competitive in a rapidly changing world. Here are some key reasons to prioritize strategy:
- Clear Direction. Strategy helps associations define their purpose, vision, and long-term goals. It provides clarity on where the association wants to go and helps align all activities towards that common direction. Without a well-defined strategy, associations can become directionless, making it difficult to make informed decisions.
- Resource Allocation. Strategy enables associations to allocate their financial, human, and technological resources in the most effective manner. It helps identify areas of opportunity, potential risks, and areas of investment. With a clear strategy, associations can avoid wasting resources on low-impact initiatives and focus on activities that generate the highest value.
- Competitive Advantage. In our increasingly unpredictable world, associations need to differentiate from their rivals. A well-crafted strategy helps identify unique value propositions, target specific market segments, and develop a sustainable competitive advantage.
- Adaptation to Change. Markets and industries are constantly evolving, driven by technological advancements, changing consumer preferences, and emerging trends. Associations that fail to adapt risk becoming obsolete. Strategy provides a framework to assess market dynamics, anticipate future trends, and proactively respond to them. It helps associations stay agile and resilient, enabling them to navigate uncertainties and seize emerging opportunities.
- Enhanced Decision-Making. Strategy provides a structured approach to decision-making. It helps associations evaluate alternatives, assess risks, and make informed choices based on a clear understanding of their goals and the available resources. A strategic mindset ensures that decisions align with the long-term vision, reducing short-sighted or reactive decision-making that may harm the association’s overall performance.
- Alignment and Engagement. A well-communicated strategy helps align employee and volunteer efforts. When staff and volunteers understand how their work contributes to the larger strategy, they feel a sense of purpose. Strategy provides a framework for cascading goals and objectives throughout the organization, fostering a cohesive and collaborative work environment.
- Measurement and Accountability. Strategy provides a basis for measuring progress and evaluating performance. Clear key performance indicators (KPIs) derived from strategy help monitor results, identify areas for improvement, and hold individuals and teams accountable. It enables associations to track success and make necessary adjustments to stay on track.
Investing in strategy is essential for associations to establish a clear direction, allocate resources effectively, gain a competitive advantage, adapt to change, improve decision-making, align employees, and measure progress. By doing so, we can increase our chances of succeeding in a new, unpredictable world.
Why We Need Both Strategy and Planning
“Everybody’s got a plan until they get punched in the mouth.”
Investing in strategy and developing a strategic plan are related concepts but have distinct differences. Here’s an explanation of each:
- Investing in Strategy. Investing in strategy is investing in a set of focused choices that define a shared, compelling future. The purpose is to develop a unique value proposition and to gain competitive advantage. It involves making deliberate choices on who we want to be, where and how we want to serve, how we plan on winning, and where to invest and allocate resources to achieve specific outcomes. Investing in strategy often involves committing capital, time, and effort to support execution. This can include activities such as acquiring new technologies, hiring talent, enhancing organizational capabilities, expanding infrastructure, reaching new markets, and/or growing research and development.
- Developing a Strategic Plan. Developing a strategic plan is a comprehensive process that involves defining an organization’s mission, vision, values, and long-term goals. It is a structured approach to establishing the direction and priorities of an organization. It can be considered an outgrowth of a focused, choice-driven strategy. Strategic planning typically includes conducting a situational analysis, identifying strategic objectives, formulating strategies to achieve those objectives, and defining action plans with specific timelines and responsibilities. The strategic plan provides an executable roadmap, outlining the desired future state and the steps required to reach it. It serves as a guide for decision-making, resource allocation, and performance measurement.
Investing in strategy is the act of making bold, specific choices while developing a strategic plan is the process of creating a roadmap to guide how the association will make these choices come true.
Integrated Cascade of Choices – The Playing to Win Framework
“Strategy is an idea that describes a journey to a position of advantage.”
Martin and Lafley’s Integrated Cascade of Choices is a framework that helps organizations position themselves to deliver unique value. Here is a quote from the book:
“The essence of great strategy is making choices – clear, tough choices, like what businesses to be in and which not to be in, where to play in the businesses you choose, how to win where you play, what capabilities and competencies you will turn into core strengths, and how your internal systems will turn those choices and capabilities into consistently excellent performance in the marketplace. And it all starts with an aspiration to win and a definition of what winning looks like.” (Lafley and Martin, Playing to Win: How Strategy Really Works, page 46).
It consists of five interconnected parts: winning aspiration, where to play, how to win, what capabilities must be in place, and what management systems are required.
Here we explore how this cascade can be applied to an association, providing a step-by-step guide to developing a winning strategy. Before we do so, it is wise to frame the exercise by clearly defining a problem to be solved. For example purposes, let’s use this generic one:
To strengthen our association’s position in the market by creating a specific and shared understanding of our destination and by outlining and committing to the choices needed to win.
Now onto the five integrated choices:
- Winning Aspiration. The winning aspiration is the first step in the strategic choice cascade. It involves defining the overarching goal or purpose of the association. This is a little confusing as winning aspiration sounds like a catchall for mission, vision, and values. I recommend thinking of the winning aspiration as the vision or the compelling yet focused description of a successful outcome. Here it’s important to focus on what makes your association unique. A winning aspiration is a future-oriented statement that focuses outward on winning with your most important customers and against your very best competitors. Avoid statements like “improve sales 10%.”
Define winning by painting a picture of a brilliant, successful future for your association. This should combine a strong desire with a high goal. If we use an apple growing association as an example, a great winning aspiration would be something as simple as “apples for everyone.” More specifically, it could be: to be the most-consumed fruit in the world. This aspiration should inspire and guide all strategic decisions made by the association. Here are questions that need to be answered to derive a winning aspiration:
- What is our purpose?
- What is our vision?
- What is our ambition, qualitatively and quantitatively?
- What does winning look like for our customers, stakeholders, volunteers, and employees? In their own words, how will we know we’ve realized our ambition?
- Where to Play. The second component of the cascade is determining where to play. This involves identifying the specific markets, segments, or areas of focus that the association will target. For an association, this could mean determining the specific professional disciplines or industries it aims to serve. By defining the scope of its activities, the association can allocate its resources effectively and create a strong value proposition for its members. This graphic lays out the fundamental constructs of ‘where to play’. Note the emphasis on differentiation and the whether or not we can win. Below are additional questions that should be answered to define an association’s where to play:
- What existing categories, territories, markets, etc. will we invest in to achieve our ambition?
- What adjacent (or new) categories, territories, customers, partners, markets, etc. should we prioritize and explore (if any)?
- How will we sequence investments over time across existing, adjacent and new opportunities?
- How will we reach out members?
- How to Win. Once the association has identified where to play, the next step is to determine how to win in those chosen areas. This involves making choices about the association’s competitive advantage and value proposition. It requires understanding the unique needs and desires of its members and offering compelling value, such as networking opportunities, continuing education, professional certifications, or advocacy. The association should aim to differentiate itself from competitors and provide exceptional value to its members. Here are questions that need to be answered to position an association’s how to win:
- What are the requirements to win in our priority businesses, categories, territories, or customers, etc.?
- Who is our competition?
- What is our differentiating value proposition?
- What are our sources of competitive advantage (capabilities, assets, etc.)?
- What synergies exist across our different businesses?
- What role should partnerships play in our choices?
- What cost profile do we need to achieve?
- What Capabilities Must Be in Place. The fourth component focuses on identifying the capabilities that an association needs to have in place to successfully execute its chosen strategy. This involves assessing the skills, resources, infrastructure, and org structure to deliver on the value proposition. For example, the association may need to invest in technology for online learning or networking, hire subject matter experts, or develop partnerships to enhance its offerings. By aligning its capabilities with its strategic choices, an association can ensure it has the necessary resources to achieve its goals.
- What new capabilities and competencies do we need to win?
- How can we leverage existing assets and capabilities as a source of competitive advantage?
- What other strategic investments are needed?
- How should our ways of working evolve? What new processes and protocols do we need in place?
- What new data, technology, systems, and tools are required to win?
- What Management Systems Are Required. The final component of the cascade involves determining the management systems necessary to support the chosen strategy. This includes the processes, metrics, incentives, and culture required to drive and sustain strategic execution. For an association, this could involve establishing governance structures, creating performance metrics to measure member satisfaction and engagement, implementing effective communication channels, and fostering a culture of continuous improvement and innovation. These management systems ensure that the strategy remains a priority and that the association can adapt to changing member needs and market dynamics. Here is a list of guiding questions:
- How will culture and norms need to evolve?
- What org structure and governance model are needed?
- What are the desirable internal attitudes and behaviors?
- How will we measure success?
- How do we align incentives to drive desirable behaviors?
- What training and development will be needed?
Now, let’s apply the integrated cascade of choices to an association focused on apple growing.
By following this integrated cascade of choices, an association can claim a bold yet focused winning aspiration, way to play, and how win as it aligns its activities, resources, and management systems to achieve success.
Winning is Differentiation
“Strategy is about making choices to win in the marketplace.”
The integrated cascade of choices provides a systematic approach to making integrated yet coherent choices. Here is why it is both vital and invaluable:
- Clear Focus on Winning. The strategic choice cascade helps associations maintain a clear, differentiated focus on winning in a chosen market. It encourages stakeholders to define what winning, which sets a clear direction. By articulating what it takes to win, associations can align their strategies, resources, and actions accordingly. This clarity enables them to make informed choices that increase their chances of success.
- Analytical Rigor. The strategic choice cascade promotes an analytical approach to decision-making. It guides associations through a series of key questions that address market dynamics, competitive advantages, and resource allocation. This analysis helps identify the most attractive opportunities and the required capabilities to effectively seize them. By considering multiple options, assessing risks, and evaluating potential outcomes, associations can make more informed choices. This analytical rigor also reduces the likelihood of making hasty or ill-informed decisions.
- Alignment and Accountability. The strategic choice cascade fosters alignment and accountability throughout the association. It provides a framework for cross-functional collaboration, ensuring that diverse stakeholders are involved in the strategy process. By involving key players, associations can leverage diverse perspectives and expertise, leading to a more focused, relevant strategy. The cascade also establishes clear metrics and milestones to track progress and hold individuals and teams accountable in executing the chosen strategy. This alignment and accountability enhance the chances of successful implementation.
The integrated cascade of choices is indispensable because it fosters a clear focus on winning, encourages analytical rigor in decision-making, and promotes alignment and accountability within the organization. By leveraging this approach, associations can improve their chances of long-term success in a competitive, rapidly changing, and unpredictable world.
Execution is Cultural
“Strategy is perpetually aligning the needs of the market with how you produce value.”
James B. Young
The concept of strategy is often misunderstood or misused.
People commonly confuse it with strategic planning or ascribe it is something that senior management is solely responsible for.
Though it is indeed difficult, strategy is a required, ongoing investment. Properly embedded and sufficiently implemented, strategy will result in a new daily rhythm focused on shared aims and new growth. Good strategy is rare; good strategy properly executed is rarer yet. This graphic from Leinwand and Mainardi frames how rare it is indeed.
This is why I believe strategy should be both widely owned and cultural in nature. That is, strategy needs to be distributed, sustained, socialized, and reinforced.
The integrated cascade of choices provides a systematic and logical framework for developing a winning strategy. By clarifying the winning aspiration, determining where to play, defining how to win, identifying necessary capabilities, and establishing appropriate management systems, associations can indeed build and succeed at a future of their choosing.
About the Author
James Young is founder and chief learning officer of the Product Community®. Jim is an engaging trainer and leading thinker in the worlds of associations, learning communities, and product development. Prior to starting the Product Community®, Jim served as Chief Learning Officer at both the American College of Chest Physicians and the Society of College and University Planning.