Unconstraining thinking through 10x
September 19, 2020 Greg Brown
One of the big challenges of any strategy or operating model design is to get the right balance of certainty of delivery and driving for outperformance. Aim too high and you could end up with nothing; play it safe and you risk plateauing as a ‘me too’ player in the market.
Traditional approaches to business challenges try to find this balance in various ways. Competitor analysis provides some calibration, and external experts, like talent from other industries, can bring stories of success.
However, none of these solutions truly unconstrain thinking. When the starting point is growing from the status quo or within the existing paradigm, there is still a high chance of delivering average performance, and not outperformance.
The solution – ‘10x’
To deliver outperformance, we find it helpful to think about what ‘10x’ would look like.
In simple terms, this means asking management what they would need to do to deliver a ’10x better result’. If you are designing a new growth strategy, don’t just think about how to grow $100m p.a. but how to grow $1bn. If you are trying to take out 10% of cost from your operating model, think about how to take out 50% – because of course 10x is a figurative multiplier.
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The target is deliberately designed to be well beyond your comfort zone and to trigger new thoughts. Should we be thinking about our advertising budget, or should we be thinking about transformational new routes to market? Should we be using management time to talk about the number of FTEs in our pricing function, or should we think about how to automate 50% of our portfolio through a new approach to data and analytics?
Ultimately you would not expect to implement many of the 10x ideas, but they should have stretched the thinking – and ideally should have materially influenced at least one part of the approach. In other words, by combining this methodology with the more ‘traditional’ elements of their plan, clients can balance risk and certainty – and achieve outperformance.
How does it work?
There are four simple steps to apply 10x thinking:
1. Define the 10x target or targets. For example that could be 10x GWP growth ambition, 10x cost reduction target, 10x customer growth, 10x faster delivery? Simplicity is key.
2. Design the 10x model. Set out what it would take to achieve the 10x target. Where applicable this should cover external factors (e.g. distribution channels) and internal delivery (e.g. organisation structure and size). As this is a thinking exercise, the approach should not be constrained by achievability at this point.
3. Compare against the 1x model. Perform a side-by-side comparison of the 10x and 1x models. In what areas of the 1x model have you been unambitious?
4. Refine the 1x better model. Incorporate any relevant aspects of the 10x model into the 1x model. It is possible that your 1x model does not change but you can be confident that you have considered your options.
The Oxbow Partners experience
We often adopt the 10x methodology in our projects, whether or not our clients are aware. It gives us confidence that we explore the true boundaries of the challenge and deliver a differentiated solution. We are pleased that many clients tell us that we challenged their thinking and helped them find outperformance.