1. Specify Conditions

Once a diverse set of possibilities is established, the team then needs to reverse engineer the logic of each possibility. That is, it needs to specify what must be true for the possibility to be a terrific choice. Notice, this step is decidedly not for arguing about what is true, but rather for laying out the logic of what would have to be true for the group to collectively commit to a choice...

This process is a form of reverse engineering because the starting point is the (tentative) assumption that the conclusion is valid—namely, that this is a great possibility. The team then works to understand the conditions under which that assumption is correct. It works backward to declare the various conditions that would have to hold for this to be a great possibility. Figure 8-3 shows the logic flow of this reverse-engineering exercise. In each of the seven boxes, you can list what would have to be true along that dimension for the option in question to be valid.

1. Identify Barriers to Choice

The fourth step in the process constitutes a 180-degree flip. The previous step stayed assiduously away from opinions on whether the conditions would hold true. This creates an environment that enables each team member to explore the logic behind the possibility and to codify and organize it. Now, and only now, you can cast a critical eye on the conditions your team has identified. The task is to assess which of the conditions your team believes are the least likely to hold true. In other words, now that you’ve specified what would have to be true for this possibility to be a great idea, which of those conditions worry the team the most and seem the least likely to be true? These conditions constitute the barriers that keep you and the team from choosing that possibility. Until you know if they are true or not, you can’t move ahead. In this step, it is extremely important to pay close attention to the group member who is the most skeptical that a condition will hold true; a skeptic can provide extremely valuable insurance against making a bad choice. So

skeptical group members must be encouraged to raise, not suppress, concerns at this point in the process. Even if only one person has concerns about a given condition, it should remain on the list of key barriers.

1. Conduct Tests

The test design process leads to the actual testing phase and the analysis of results. Here,

we recommend taking what we sometimes call the lazy person’s approach to strategy. Simply put, first test the things you’re most dubious about. Take the condition the team feels is the least likely to hold up, and test it first. If the team’s suspicion is right, that possibility will be eliminated without the need to test any of the other conditions. The possibility has already failed an essential test, so no more tests are necessary. If, on the other hand, the possibility passes the first test, move on to the condition with the next- lowest confidence level, and so on...

To generate choice and commitment, companies actually need analysis that is an inch wide and a mile deep—focused precisely on the concerns that prevent the team from choosing and going deep enough in that particular area to meet the team’s standard of proof. That is what reverse engineering enables you to do: probe precisely and deeply into the barriers to choice.

That, in sum, is the process for choosing between possibilities for where to play and how to win. First, frame a choice. Second, explore possibilities to broaden the set of mutually exclusive possibilities. Third, for each possibility, ask, what would have to be true for this to be a great idea, using the logic flow framework to structure your thinking. Fourth, determine which of the conditions is the least likely to actually hold true. Fifth, design tests against those crucial barriers to choice. Six, conduct tests. Finally, in light of the outcome of the tests and how those outcomes stack up against predetermined standards of proof, select the best strategic choice possibility. This process broadens the possibilities up front and then systematically narrows the field. It leverages different perspectives to enrich the discussion, rather than bogging it down.

“REVERSE-ENGINEERING DOS AND DON’TS

• Don’t spend a lot of time up front analyzing everything you can; instead, use reverse

engineering to pinpoint only what you really need to know.

• Do frame a clear and important choice up front; make it real and significant.

• Do explore a wide range of where-to-play and how-to-win possibilities, rather than narrowing the list early on to those that feel realistic; unexpected possibilities often have interesting and helpful elements that can otherwise be dismissed out of hand. Learn from them.

• Do stay focused on the most important question (what would have to be true for this to be a winning possibility?), listing the conditions under which this possibility would be a really good one.

• Don’t forget to go back and eliminate any nice-to-have conditions; every condition should be truly binding—if it weren’t true, you wouldn’t pursue the possibility.

• Do encourage skeptics to express concerns at the specify-barriers stage; have them articulate the precise nature of their concerns about specific conditions.

• Don’t have proponents of a given possibility set and perform the tests; ask the

skeptics to do it. If the skeptics are satisfied in the end, everyone else will be too.

• Do test the biggest barrier first. Start with the condition the group feels is least likely to be true. If it isn’t true, the conditions required do not hold and you can stop testing.

• Do use a facilitator to run the reverse-engineering process; it helps to have someone to attend to process and group dynamics as you work through the thinking tasks.