From Tactics to Strategy with Michael Watkins

Drew: Hello, Renegade Marketers! If this is your first time listening, welcome. If you're a regular listener, welcome back. Before I present today's episode, I am beyond thrilled to announce that our second in-person CMO Super Huddle is happening November 6th and 7th in Palo Alto. We're excited to have five flocking awesome founding sponsors: HG Insights, Boomerang, Webless, Firebrick, and Webflow, and an amazing VIP dinner sponsor with Vidoso. Last year, we brought together over 100 marketing leaders for a day of sharing, caring, and daring each other to greatness, and this year we're doing it again. Same venue, same energy, and same ambition to challenge convention with an added half-day strategy lab exclusively for marketing leaders. Tickets are now available at CMOHuddles.com. Do yourself a favor—check out some of the speakers and experts we have. It will blow you away. You can also watch a video that I am confident will get you pumped up, and it also shows what Gen AI video can do right now. Grab your ticket before they're gone. I promise you we will sell out, and it's gonna be flocking awesomer!

Welcome to CMO Huddles Quick Takes, our Tuesday Spotlight series where we share key insights that you can use right away. Today, we're joined by Michael Watkins, professor at IMD Business School and author of "The First 90 Days," to talk about his newest book, "The Six Disciplines of Strategic Thinking." He breaks down what it really means for CMOs to step into the strategy sphere, think like enterprise leaders, and build teams that can recognize key priorities, align around them, and turn strategy into action. Let's get into it.

Narrator: Welcome to Renegade Marketers Unite, possibly the best weekly podcast for CMOs and everyone else looking for innovative ways to transform their brand, drive demand, and just plain cut through, proving that B2B does not mean boring to business. Here's your host and Chief Marketing Renegade, Drew Neisser.

Drew: I'm thrilled to welcome back Michael Watkins, who joins us today to discuss his latest book, "The Six Disciplines of Strategic Thinking: Leading Your Organization Into the Future." For those of you who don't know Michael, he's a professor at IMD Business School, a bestselling author of multiple leadership books, including my all-time favorite business book, "The First 90 Days," and someone who has advised countless executives on navigating complex organizational challenges. So what excites me today about Michael's framework is this: not just academic theory, it's a practical roadmap for how leaders, especially CMOs, can lead strategic thinking in their organizations. We talk a lot in this community about CMO Plus. Well, that plus could very well be strategy if you understand exactly how to make it happen. So Michael, welcome back. How are you, and where are you this amazing day?

Michael: Well, delighted to be back, and I live just outside of Zurich, Switzerland, and that's where I am today. Mercifully, always the case for everybody. When I'm here, it feels great to be here, right? I'm sure many of your participants feel the same way when you come to rest someplace. It's a beautiful thing, right?

Drew: Home, sweet home, so to speak. Well, look, just in case our audience wants to leave early, needs to leave early, or we need to convince them to stay, maybe you could outline three—say, the biggest mistakes you see leaders, and maybe especially CMOs, make when it comes to strategic thinking and driving strategy.

Michael: So number one is not doing it, not participating in it, Drew. I mean, it's a fairly obvious one, right? I'm writing a lot about what I call enterprise leadership these days, right? Which is basically leadership at the top team level, you know, with strategic implications. Typically, people leading functions like your CMOs are, or regions or business units. And the real criticality is moving beyond both individually and as a team, right?—focusing on your own part of the business or a subset of people on the leadership team—into being what you might think of as a true enterprise leader, right? And maybe the most important dimension of that is participating actively in shaping, crafting, and executing the overall strategy of the organization, right? And so I've been writing recently a little bit about what I call the "wearing the two hats" problem, Drew, right?—of sort of showing up at the leadership table, both representing your own function, your CMO space, but also being there as well for representing what's good for the enterprise as a whole. And the challenge you can face in balancing those tensions, right? And I think, you know, maybe not a trap exactly, but an admonition and invocation, right, which is: step into the strategy sphere. Right? View yourself as core, because I think you are core to shaping the strategy of the organization. Be able to participate actively in the strategic thinking that must go on at the level of the leadership team. Be prepared sometimes—and we can talk about this later if you're interested—to maybe compromise a bit on what your own organization would love to see happen in the name of the greater good, yeah. So that's kind of the big picture framing I would put on it.

Drew: And we'll get into how they do it. And definitely, I mean, we talk a lot about in Huddles about being a business leader first and a marketer second, so you don't get pigeonholed. And the worst thing that you could hear is "Oh, you're just the marketing person," which is not music to any CMO's ear. So, and we'll talk about that, okay? But what's the second mistake?

Michael: So from a strategic thinking point of view, I think that's a really important and big one, which is not engaging with your team and not building strategic thinking capability in your team, and maybe thinking that you have to be the primary strategic thinker for your team. I'm very big these days, you know? I'm working on a framework for how leaders can deal with the current turbulence, Drew, which is, to me, unprecedented, right? I've done this a long time. I know you've done this a long time. I've never seen in my career before times as challenging as I'm seeing right now, right? And it's, you know, it's technology and AI, obviously, but it's also geopolitics and high levels of uncertainty. And you know, we can go on and on and on with this, right? And so equipping leaders for the ability to do that, I think, is a big piece of this, and one of the most important things I think you need to do as a leader, as a CMO, is move from thinking about yourself as needing to exert central control to embracing shared leadership, right? And to me, shared leadership includes absolutely, critically, engaging in a shared way in strategic thinking, right? And so it's really—not doing that enough? Oh, we're gonna have a strategic planning workshop. Hurrah, right? Let's all get together and go off-site or on-site these days. Who knows, right? And have a session on strategic thinking. No, it's really about how do you embed strategic dialogue into your operating rhythms, right? Every day? How do you encourage strategic thinking and build strategic thinking capability in your team, right? So great that you're already talking about, you know, CMOs need to be business leaders. What I would also add is you need to be builders of strategic thinking capability in your teams, and not feel like you need to do it.

Drew: Yeah, that one is, it's such an interesting one because I wonder, and, you know, in this group, and I poll them privately, would they see themselves as building that strategic muscle themselves and broader below? And we'll talk about that more, because I do think it how you do that is really important too. And it is a muscle, and you talk about that in the book, that is you get better at this by doing it and playing bridge in part. Yeah, okay. And number three, what is the third one? And then we'll come back and circle back to all...

Michael: The biggest mistakes CMOs make. I'm gonna have to ponder that one a little bit. I do talk a lot about AI these days, and I'm assuming that every single one of you is actively embracing the use of artificial intelligence in your organizations, right? And if you're not doing that, then that would be a huge mistake, right? Now, I am, you know, I am hopeful and confident that you're doing that right. When I talk about strategic or about AI, Drew, and I have to do this less now because people are embracing it more obviously, right? I always put up two images, right? And one image is the dinosaur admiring the beauty of the incoming asteroid, right? And the other is the surfer surfing the huge tsunami, right? And I think I always say you've got to be the surfer with this stuff, and you've got to be embracing it. I'm working, you know, a slight digression, very actively, with a very interesting world-class tech platform company right now that I'm engaged in a process with them of reinventing their entire business around networks of agents, right? So agentic AI is kind of very much on the topic list for them, and they're really thinking about their organization, you know, leveraging agentic AI and networks of agents, and leveraging some of the new protocols that are available to build that organization from the ground up, and exploring what does that mean fundamentally for how you think about organizing, right, organizing more horizontally and less vertically, or, you know, really connecting processes and thinking about the spirals that have to move through your organization, and that core mix of tools, processes, and data that is the core of that spiral, right? So I guess, you know, if you're not doing that, be afraid, right? Be very afraid. But again, I assume you know most CMOs are embracing it.

Drew: It's funny, because this month, we happen to be doing all of our peer huddles focused on it, and there isn't a single one coming to those huddles that doesn't have use cases where they're doing it. And I want to circle back later because on this in terms of using AI for strategic thinking and so forth, which I'm sure you've been dealt with. But let's go back. So we get, we, you want a seat at the strategy table. You're a CMO with the title marketing in your function. And I'm curious, when you're not in a lot of companies, the bigger they are, they might even have a head of strategy, or maybe the CEO is a founder, and they believe they are the head of strategy. How does one, as a CMO who was not given the mandate, lead strategically, right? They were given the mandate to lead marketing, if there is such. Yeah. So how do you recommend to folks that are on the executive committee to sort of help get in the mix?

Michael: Yep. So I think the starting point for me is getting super clear in your mind about exactly what strategic thinking is and how it differs from strategy. I think we don't need another book in the world on strategy. There's some wonderful stuff out there, but strategic thinking is something different, right? Strategic thinking is the set of mental disciplines that you're engaged in, a set of dialog processes that you're embarking on that lead eventually to strategy, but often, more importantly, lead to changes in strategy, right? And so, you know, when I started doing work on this, Drew, I, you know, I interviewed, I think, probably more than fifty senior executives about strategic thinking, and my first question was, "What is strategic thinking?" right? And almost without exception, their eyes would kind of defocus a little, and, you know, they kind of like strain a bit, and then it was kind of like, "I know it when I see it," right? Which isn't very helpful, right? Isn't very helpful because you can't assess people, you can't develop people. I'm sure many of your participants have, you know, seen people who have been told at some point you need to become a stronger strategic thinker. And you know, what in the world does that mean? And that is that code for, "We're not going to promote you." So clarifying what strategic thinking was was a core part of what I felt like I needed to do, right? And the definition I came up with, which underpins the entire book, right, is this: the process of recognizing emerging threats and opportunities, right, establishing the right priorities and mobilizing your organization to do something about it, right? So recognize, prioritize, mobilize as kind of the strategic thinking cycle that I focus on. It's not an accident that the initials spell better RPM. It's, you know, I'm trying to convey that moving around that cycle fast is very important. I'm sort of building, by the way, on work that was done in the military, right, about the revolution in military affairs and how you move faster than your enemy, right? But you'll notice that nothing I just said is directly about the strategy of the organization, right? It's about adaptation, right? And most of what I'm interested in these days is adaptation, right? It's about how do we build organizations that are more adaptive? And I view strategic thinking as probably the most important foundation for that, right? There's other things we could talk about. I wrote an article recently on the key elements of adaptive organization, right? So, but if you're not thinking strategically, if you're not recognizing prior to mobilizing effectively, it doesn't really matter, because you're going to get almost inevitably blindsided. And that leads to some interesting sort of tensions between planning and executing and learning and adapting. And how do you sort of strike the right balance between those two things, right? We still need to plan and execute, but typically it's on shorter cycles than we used to, but that critical piece of learning and adapting, and how do we really embed that in the organization, is critical. And then I think to get back to your question, right? What that means is not that you, as a CMO, need to be talking about strategy or, you know, but you need to be engaging in the process of discussion in a way that conveys that you are a strategic thinker, right? And that can be as simple as, you know, "If we do this, what happens next?" It can be things like, you know, "If we sort of step back and take a look at this and think about it from the broader customer perspective, what does that do? Where does that take us, right?" "If we try to integrate that with what we're doing in product development, right? Does it all fit together?" And one resource I'll send, actually, Drew, afterwards is a Harvard Business Review article that a colleague and I wrote about communicating like you're a strategic thinker, right? So, and it's really about what we're talking about, right? Which is engaging in dialog in a way that conveys that you are thinking strategically. And I know my father, who was a bit of a humorist, used to say, "It's important to at least look like you know what you're doing." And so you know, being able to engage in discussions at the leadership table in a way that conveys that you're thinking strategically, I think, is a key piece of this. So that'll be one resource that I'll share.

Drew: Thank you for that. So recognize, prioritize, and mobilize. And so I want to talk about sort of a common challenge that in the last six months, because of the economic uncertainty, because of the technological disruption, and you know, CFOs have become CFOs again. Deal cycles have lengthened, and when you don't win, you typically don't win because they didn't buy anything. It's not even that you lost to a competitor, necessarily. So a lot of business. And so what happens in that standpoint is they look at the sales person, the marketing person, they say, "Well, you're not hitting your numbers," CSO, and there's a bigger issue, and there's probably the need to recognize, prioritize and mobilize in a different direction. And so I'm imagining that's what this is about. It's like, it's not a marketing problem right now. It's a much bigger problem that, in fact, marketing can probably help solve, but it's a go-to-market and promise problem.

Michael: So absolutely, right? And you're taking us through in very interesting directions, right? Which is, again, you know, I'm doing a lot of thinking about different pieces of this. And one piece I was writing about was building organizational sensory systems, right? The systems that help you sense and respond to what's going on in the external world, right? And it's one of the articles, again, I'll send to you, and I dug very deeply into how Amazon does it, right? So, what are the strategic sensors, if you will, that the organization has to detect what's happening in the external environment, with customers, for example, right? Or operationally, what's happening in the supply chain. What are the internal sensors they have that detect what's going on with, you know, engagement levels, as an example. And then, how do you kind of integrate that information? How do you apply—and Amazon's brilliant at this—analytical intelligence to get predictive insight out of it, so that you're not reacting, right? You're shaping, which is ultimately the goal of this, right? The goal, and again, I go back to very famous work that was done by the military, is to be the one that is shaping what's happening, and not the one that's responding to what's happening. But in order to do that, you need to have that sensory system out there, and think of it as like the nervous system of the organization, right? Sort of that's detecting what's happening, right? And if you have that sensory system working, you get early warning and you don't—then I think what's critical is you don't get kind of point solutions, sort of point definitions of the problem, right? Congratulations. It's a marketing problem, congratulations. It's a supply chain problem, right? They're typically much more nuanced than that. And that's, I guess, another piece of this, which is, how do you be sure you're solving the right problems? One of the key things in strategic thinking, and I talk about it a fair amount in the book, is framing problems as a leadership team, right? And making sure you're actually solving the right problem and not—you know, the joke was jumping to solutions, right? You're not pre-determining what you think the problem is, yeah? So I think these pieces kind of fit together. If you've got a sensory system that's seeing what's happening and allowing you to proactively respond, if you're doing a good job of framing and exploring what the real problem is as a team, right, then you're not going to get caught in this, you know, congratulations. We're going to do a ritual execution of the CMO because, you know, like, we can't think of anything else to do, right, given what's going on.

Drew: Well, what's interesting to me is, from a CMO standpoint, they, in theory, have a sensory system, as you describe it. They are, you know, a lot of them have services like Gong or Outreach, where they're listening to all the calls, or they have customer advisory boards, or they have other ways of recorded input from customers and prospects that are giving them now—it may be this moment. It may not be six months out. It may not be trend, but it's certainly a lot of data that would at least give them strength at it. Analyzing some of this, I think there's sort of two things I'm wondering about right now. One is the CMO needs—wants to be part of this conversation, and they may or may not be asked. The CMO also has a lot of information in theory that very few other folks have, which is customer data, customer input.

Michael: Which is a huge source of power to your point.

Drew: Right. Is that the point that they can use to sort of say, "I deserve a strategic seat at the table because I can represent the customer, and I kind of know where they're going right now?"

Michael: Yeah, so yes and no, right? I think yes, absolutely. You know that information is a source of power. I think sharing that information in is critical, right? But I think then moving beyond that information, right, to say, look, we need to look at this problem not just from a customer perspective. And here's some customer data that helps us think about that. But you know, what's that? What are the implications for the supply chain, right? What are implications for investment, right? And so, you know, again, it goes back to how you're communicating, that you're thinking strategically, right, and not locked in your little silo right now, leveraging that information, right? But also saying, look, it's part of our sensory system, right? And we want to fuse it with other information in order to give us a sit wrapped picture of really what's happening in the organization. So I guess that would be the yes and no, Drew, of what you said.

Drew: And it's really important point. I'm going to sort of repeat it at the risk of being redundant, but you've got to connect the dots. Yes, you have the customer information, but connect it to the other elements of the program so people see that you understand the big picture.

Michael: And well, then let me add something else, right? Which is one of the hallmarks of strategic thinkers is that they're hypothesis generators and testers. So when you look at that data, you can say, look, you know, there's a few possible explanations for what's going on here, right? This—there's this explanation, there's this explanation, there's this explanation. Let's talk about how we're going to test and dive deeper, collectively, into understanding which of those hypotheses is the right one, right? So, you know, not getting locked into kind of solution provision, right? But, you know, thinking in terms of hypotheses, and the instant you start talking in a leadership team, in my experience, right, of saying, hey, it could be this, right? And that's, you know, the most obvious place we're going to go and jump, but let's consider the possibility that it's that, and let's at least kind of do a little testing, you're automatically in the realm of demonstrating, I think, that you're a strategic thinker.

Drew: That's a wrap on this Huddles quick take with Michael Watkins. In the rest of the conversation, Michael shares how to make time for real strategic thinking, what it takes to embed those habits across your team, and how reflection can sharpen every big decision. Catch the full episode and see the extended discussion on the CMO Huddles YouTube channel. I'm Drew Neisser, and we'll be back soon with another Huddles quick take. Until then, keep those renegade thinking caps on and strong.

Show Credits

Renegade Marketers Unite is written and directed by Drew Neisser. Hey, that's me! This show is produced by Melissa Caffrey, Laura Parkyn, and Ishar Cuevas. The music is by the amazing Burns Twins and the intro Voice Over is Linda Cornelius. To find the transcripts of all episodes, suggest future guests, or learn more about B2B branding, CMO Huddles, or my CMO coaching service, check out renegade.com. I'm your host, Drew Neisser. And until next time, keep those Renegade thinking caps on and strong!