The President and CEO for Ford Motor Company, Mark Fields, had a conference where he spoke about Ford entering the self-driving car race in 2021 hoping to establish Ford as a leader in this field.
Of course, self-driving is the next car revolution so it’s not surprising to hear Ford is entering the space.
What’s interesting is how he explained Ford’s decision making process and the way they operate. In order to make any investment they go through 3 simple questions:
- Where do we want to play? As in, what part of the market are we going after?
- How will we win? Here you need to be brutally honest about your capabilities. The answer to this questions is what need will your company need to satisfy in order to be successful. If you’re overly optimistic about your answer and it’s not what you’re looking for, go back to the first question and start over. If the answer is positive, move on to the next question…
- What capabilities do we need? As in, what do we need to make this a success? Here you analyze your capabilities such as resources, look for outside talent and even consider acquisitions. A very important point here is any party involved needs to add value to the project or else those relationships will not last because they’re not sustainable.
This is basic reasoning but very powerful. These three questions can lay out an entire business strategy and it applies to both established companies and startups.
I believe these questions come from Roger Martin’s strategy book Playing to Win: How Strategy Really Works, where he says that strategy is the answer to these five interrelated questions:
- What is your winning aspiration? The purpose of your enterprise, its motivating aspiration.
- Where will you play? A playing field where you can achieve that aspiration.
- How will you win? The way you will win on the chosen playing field.
- What capabilities must be in place? The set and configuration of capabilities required to win in the chosen way.
- What management systems are required? The systems and measures that enable the capabilities and support the choices.
So there you go, basic but powerful.