Strategy means charting the right course. This implies – without exception – charting your own course.
If you have caught anything that I write in this blog then you must’ve noticed that I am not in favor of a “herd mentality” – blindly following other sheep to slaughter is a better way to describe this thinking.
In business differentiation is king. People should be less “herd minded” in business than in their personal lives yet they seem to be more of that inclination. Boards ape other boards; CEOs ape other CEOs; CIOs jump headfirst onto the “flavor of the month” bandwagon.
Quite often, like following a crowd out of a burning building, this is the right strategy. Quite often the exact opposite is true. I would argue that big gains come from bucking the trend not following it. Following the crowd, by definition, leads to average returns!
Sometimes lessons in life come from outside our immediate circle of knowledge and operation. Here is one such example that illustrated the point I am trying to make.
Goldman Sachs is perhaps the only big boy on the street that did not go down in this home mortgage hailstorm. Why? Because it realized early on that there was a storm gathering and had the courage of conviction to chart its own course to safety.
The storm is not over yet and this story might still take an ugly turn. But as we stand here today, this “go it alone” strategy seems to have paid rich dividends for Goldman’s investors – not to mention employees!
The lesson for every strategist is a really simple one: do your homework and then even if the answer is not what you or your competitors expected have the courage of conviction to not steer away from it. This is staying the course not following any random self-serving thought that comes to your ignorant brain and suits your lazy disposition.
