An alternative to the traditional SWOT analysis.

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A White Paper from Singularity Group
Strategy Prototyping
Beyond The SWOT Analysis: Leap into the Future and Look Around — Another Way of
Thinking About Strategy
By
Michael D. Maginn
Singularity Group, Inc.
Hamilton, MA 01936
An anecdote from Len Schlesinger, President of Babson College
The President-Elect of a venerable university stood with the Provost as they prepared to
march out in procession for the inaugural ceremony. The Provost was chatting with the
President-to-be.
“The faculty is ready and eager to embark on the journey of analysis to our new strategy.
We are ready for a full year’s work, and we look forward to getting started next
Saturday,“ said the Provost proudly, resplendent in his ceremonial academic robe.
“Yes, I am glad they are ready. And yes, we will get started next Saturday,” said the new
President as they started to walk, “but we will be done by Tuesday. There is no time to
wait.”
The leaders of most organizations probably feel the same way; there is no time to wait to
decide how to move into the future. As markets and technologies evolve, all sizes and
kinds of organizations need to learn to flex with the changes. The challenge for all these
entities is to define what the future means for them. How can organizations remain
sustainable and viable in achieving their missions? What does growth mean? How
should they change?
The strategic questions that organizations face are difficult, and, at first, seem like
compromises with no obviously correct choice. The answers often reflect potential
payoffs, but also uncertain and seemingly unknowable consequences.
How does a business expand? Should a business add new services for existing clients or
go into new demographic areas to serve more clients? Will the client base support a new
direction? Will the brand stay intact after stretching beyond its original image?
© 2009 Singularity Group, Inc. All rights reserved

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In small- or medium-size businesses, these decisions are often explored in informal
discussions, at the end of busy days or at periodic retreats or “blue sky meetings”, if at all.
Strategic decision making in smaller companies may not be as high a priority as fulfilling
orders, sales, and operational efficiency. Some decisions might be considered as
strategic, when they really aren’t. New hires that stem from growth, investing in new
equipment, changing vendors are decisions that will help an organization grow, to be
sure, but they don’t really involve new forays of thinking about products, markets and
processes.
In larger organizations, the problem isn’t so much developing direction—coming up with
new strategies is a major C-Suite’s function-- but making certain that everyone in the
organization shares a consistent strategic mental model. The challenge is to gain
alignment not only in what the organization will do to grow or change, but how it will be
done. Developing consensus across any organization is a significant, ongoing and well-
documented implementation test. As Collis and Rukstad lament in “Can You Say What
Your Strategy Is?” (Harvard Business Review, April 2008),
Leaders of firms are mystified when what they thought was a
beautifully crafted strategy is never implemented…They fail to
appreciate the necessity of having a simple, clear, succinct strategy
statement that everyone can internalize and using as a guiding light
in making difficult decisions.
Despite the challenges large and small companies face in answering questions of growth
and change, a strategic direction which provides a clear picture of the future is still
essential. What kind of strategic planning process best matches the need to be nimble,
innovative, and conceptually clear and, at the same time, ensures buy-in and
consistency?
What Can Help? A New Way Of Thinking
Corporations have strategic planning departments staffed by analysts who work with top
executives to develop direction. The more traditional approach used in business is to
develop plans that are highly analytical and data-driven, producing projections and
measurable consequences which eventually serve as targets for success. Based on
these analytics, executives choose a direction which appears to have the most potential
for success. For example, a widget manufacturer contemplating new products might
analyze the current market, the competitors, and, using assumptions embodied in a
quantitative model, create objectives for a new product to achieve. In a way, success is
calculated, and if it is achieved in reality, it is a “win”. The emphasis here is on being right
about the choice made by removing or accounting for as many elements of risk as
possible. This process incorporates the familiar “SWOT” analysis (Strengths, Weaknesses,
Opportunities, Threats) which turns these attributes of an organization into quantitative
concepts.
In recent years, corporations have seen the need to become more innovative more
often and more quickly to compete successfully. As a result, insightful and
entrepreneurial ideas using technology and different business models designed to
intentionally disrupt the marketplace have become highly successful. These new ways of
thinking about business direction are based on more than analytical thinking and
quantitative models. These new developments—for example, the emergence of a
completely new music industry, the spawning of new businesses based on digital

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photography, even the creation of for-profit higher education to name only a few—are
the result of inspiration, creativity and vision. Successful corporations are finding it critical
to leap to new idea development, transforming these into new market directions rapidly
and aggressively. In this approach, there are no guaranteed successes; failure is viewed
as a cost of learning and an opportunity to try again from a new perspective.
This shift in thinking opens a whole new way to approach strategic planning for all
organizations. Frankly, the analytical SWOT-type approach doesn’t fit a smaller, resource
constrained business or larger organizations in a hurry to remain competitive. The danger
to strategic thinking in any organization is becoming hamstrung in volumes of analysis.
Instead, organizations need a process that captures the energy and commitment of
executive, managers, employees and even board members, a process that lends itself to
holistic thinking, intuition, resourcefulness, making sense and creativity and builds
consensus at the same time. As Daniel Pink points out in A Whole New Mind:
What is in greatest demand today isn’t analysis but in synthesis,
recognizing patterns, crossing boundaries to uncover hidden
connections and making bold leaps of imagination.
This approach to strategy adds another important dimension to organizations: speed.
Instead of a year-long process, “bold leaps of imagination” and the subsequent
discussions and planning that result can literally take a few weeks. As Malcolm Gladwell
describes in Blink, “Decisions made very quickly can be every bit as good as decisions
made cautiously and deliberately.”
What process makes sense for organizations in dynamic markets? What would put
intuition to work? What would allow stakeholders in these organizations to tap into the
organization’s identity and history and project it forward? How can consensus be gained
efficiently? We believe a way to capture these ideas is through prototyping alternative
futures.
The Prototyping Approach: From The Back Of A Napkin To Strategic Plan
A prototype is an early expression of an idea. Prototypes are sketches with deliberately
few or no details, high level conceptual models that demonstrate how an idea can
work; a prototype is a tangible, concrete representation. So, in a sense, a prototype is a
working model that can be set in motion, examined, not in the abstract, but by
conceptually looking at actual operations that are easy to grasp.
In prototyping strategies, the future of an organization can be described and illustrated
using a variety of techniques. Regardless of the form the prototype takes, it represents a
relatively clear view of what the organization can be. When there are multiple
prototypes representing a range of options, stakeholders can view and discuss each one
in terms of how it might operate, who it might serve, how it will be funded, etc.
Discussing a prototype is different than discussing an idea or even an intention. While a
prototype isn’t complete, it does present a shape, something to speak to with a higher
level of detail and clarity than an idea or table of numbers. In addition, a prototype has
trace persistence, that is, it lasts longer in people’s minds than an idea mentioned in a
discussion, and it resides in descriptive, tangible visual form on a flip chart illustration or
diagram.

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In organizations, these prototypes are developed by working with key stakeholders in a
meeting setting. This prototype development group needs to be small, knowledgeable
about the organization and its market, and with a certain sense of the organization’s
history. This discussion may be stimulated by a facilitator asking such questions as:
If we keep doing what we do now, how will we be successful? How will we
know?
What else—new products/services-- could we do to add value to our current
customers? What makes the most sense, based on who we are?
What if we took what we do very well now and approach new customers? What
would that look like?
What if we brought new products/services to new customers? What and who
could they be?
What if we delivered what we do differently? What would that look like?
Other kinds of questions are possible, depending on the type of organization. Input from
others not at the table can be gathered in a discussions or surveys before this core group
meeting. The point of this discussion is to express ideas that these informed groups—and
involved stakeholders--already have, unspoken and even unconscious ideas about how
the organization can grow. When these intuitive ideas are tapped in a systematic way,
prototypes of the future emerge.
For example, in working with a non-profit organization, a core group of staff and board
members said one future prototype would be to do exactly what it is doing now, only
better, with improved processes and outcome measures. That concept had been on
the minds of many people in the organization, and now it had found expression in a
prototype. After discussion of what other demographics the organization can serve, it
became clear that there were ideas of taking the organization’s processes and
duplicating them elsewhere with a new audience. Finally, the group proposed that the
organization could add collaborative processes with other charitable organizations as a
new service to repertoire, becoming yet a third prototype of the future.
A financial services company used a different approach. Instead of having a core
group develop alternative prototypes, the Chief Executive Officer was able to literally
draw pictures of three different directions the organization could take. This became the
core of a series of discussions with the executive group, which resulted in agreement on
a direction. Detailed planning followed.
This process also accommodates creative, out-of-the-box ideas as well as the more
predictable. Any idea is fair for building into a prototype as it will be tested and filtered
through the lens of feasibility and alignment with the organization’s mission as the process
moves to the next phase.
When these prototypes are complete, the process shifts to testing and vetting with a
larger audience of stakeholders. That group could mean a board of trustees, selected
executives, or the next line of management. The process in this forum is to present each
prototype in turn and ask for reactions in a highly structured way: “What do you
like?””What else could we do here?”, and “What questions does this raise?” In discussing
each simple question in turn for each prototype, a consensus begins to emerge. The
prototypes themselves change into more refined forms; ideas are added, aspects of
different prototypes clearly become favored or discounted. The group process shifts to

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looking at what it would take to pursue the two or three directions that have emerged.
A different set of questions is used to bring the idea down to a more tactical reality:
“What assumptions have we made?” “What do we know and not know about how this
will work?”
Strategy prototyping as described here has its conceptual roots in the Scientific Method.
The scientific process capitalizes on the reservoir of knowledge in a particular field; skilled
and knowledgeable researchers, intimately and holistically familiar with this knowledge
base, generate working ideas and hypotheses by asking what-if questions. These
hypotheses can be tested for veracity or effectiveness in a rigorous way.
Similarly, in developing a strategy prototype, a knowledgeable core group can posit
different business models or even variations of a model and project the impact of these
on cost, effectiveness, risk, resources, donor base and the like. The result is a sense of
what might work and what unknowns still need to be answered. In a sense, a strategy
prototype is like a “mind experiment” of trying on alternatives and assessing results.
When a set of prototypes are analyzed, the core group comes to agreement on a sense
of direction, based on what models are most appealing at this early stage. The process
goes on to exploring what it would take to put the ideas to work.
Implementation Planning: The Next Step Is Tactical
Once general directions—based on discussion of the prototypes--are identified through
this process, tasks groups are formed around key planning questions that need to be
answered:
Does the direction match and reinforce our current mission?
What’s the best way of doing this?
What capabilities do we need to add or develop to actually do this?
What would make this worth doing? Would benefits outweigh risks?
What would be the ultimate impact of this work on our mission?
Task groups work in parallel over a matter of weeks on answering these implementation-
oriented questions. For example, one task force might look at what an “improvement of
existing processes” would take to put to work. Another would identify steps needed to
“form strategic alliances”. Each task force would have to create a set of
recommendations for the core group to consider. It is helpful for each implementation
team to consider variations on how it strategic initiative might look. For example, the
collaboration team might consider three different models of alliances—leadership, client
or partner. They can then test each in terms of capabilities, value to the organization
and impact. In this way, the prototyping concept—creating rough sketches of how the
end might look—can help focus and clarify the choices being considered in tactical
implementation planning.
What is interesting is that these recommendations are not primarily about direction, but
tactical implementation. Annual plans and objectives for each initiative can be
immediately put to work. So, these plans become an agenda for the board and
management to monitor on a regular basis. The strategic plan becomes a living, working
concept which is brought forward and used to guide everyday activities.

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What Prototyping Strategies Does
Using a prototyping approach gives stakeholders in organizations a sense of urgency
and control over the strategic planning process. The process is designed to stimulate
and leverage intuition and creativity, producing a series of increasingly more refined
models. Ideas are described in concrete terms; obstacles and opportunities can be put
into motion, tested and their impact envisioned and imagined. There is still an important
place for analysis and quantitative thinking in the planning process, when decisions have
to be made about how, why and what results should be expected.
The prototyping approach offers a timely and robust vehicle for any organization to
reach for the future. Because of the need for conceptual clarity and alignment, the
process is designed to optimize consensus and open discussion, ensuring that the ideas
and directions developed through this process are implemented as planned. The
execution of the strategic plan on a regular, weekly basis through programs, projects
and processes is the ultimate test of success. When the process is designed to promote
understanding, support and buy-in, enthusiastic and compliant execution is much more
likely.
References
David J. Collis and Michael G. Rukstad, “Can You Say What Your Strategy Is?”, Harvard
Business Review, April 2008.
Malcolm Gladwell, Blink, Back Bay Books, 2005
Daniel Pink, A Whole New Mind, Riverhead, 2005
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