The Best Digital Strategists Don’t Think in Terms of Either/Or

It has become an axiom that “strategy is about making hard choices,” as we have been advised for over 20 years by leading thinkers including Michael Porter and Roger Martin. But our work with a community of senior executives in the Bay Area suggests that today’s market leaders are following the advice of Yogi Berra: “When you come to a fork in the road, take it.” Faced with hard choices, innovators find ways to transcend the tradeoffs. While their competitors make the hard choice between one or the other path, these businesses reap the benefit of both.

Transactions and relationships. When it comes to digital engagement, many companies feel they have to choose either transactions or relationships. Social media evangelists tell CEOs they need to stop focusing so much on driving sales and “connect instead of promote.” A focus on the transaction, they say, jeopardizes the relationship. Meanwhile, sales strategists suggest that social media is often more “hype” than “reality.” Focus on the relationship and forget the transaction, and you waste the company’s resources. The hard choice, it would seem, is between transactions or relationships.

Sephora has become a leader in the cosmetics market by transcending this tradeoff, finding ways to achieve transactions and relationships. It has a vibrant e-commerce business and a highly engaged customer community. What is particularly impressive is how Sephora is bringing transactions and relationships together in the same experience. On the Sephora Beauty Board, community members can upload photos of their favorite “looks” with the makeup products that made it possible. Click on a photo and you can see someone’s profile or posts. Click on a product and you can make a purchase.

High-tech and high-touch. There is concern these days about how technology is replacing our jobs and estranging our connections. As our communications become more digital, our customer relationships become less personal. The only hope seems to be make our technology appear more human.

In the apparel industry, companies choose one path or the other between high-tech and high touch. Shopping services like StyleSeek take the road marked “algorithm,” while Nordstrom’s Trunk Club takes the road marked “personal service.” Approaching the same fork in the road, Stitch Fix chose to go in both directions. New customers fill out a survey about their style and lifestyle. Ever-evolving algorithms then generate recommendations for Stitch Fix stylists, who select the final assortment for their customers based on personal knowledge and relationships. It’s no coincidence that the Chief Algorithms Officer at Stitch Fix was formerly head of data science for Netflix, and its Chief Operating Officer, Julie Bornstein, was formerly CMO at Sephora. Together, they are transcending the tradeoff between high-tech and high-touch.

Size and speed. There is an African proverb, “If you want to go fast, go alone. If you want to go far, go together.” Most large companies excel at going far and going together. But these days every company has to go fast. Is it possible to be both bigger and faster? The recent experience of Visa provides some lessons in how to transcend the tradeoff between size and speed.

The market for cardless payments is growing rapidly, posing a threat to Visa’s core business. Four years ago, Visa launched, but failed to gain ground against its nimble new entrants. For the recent launch of Visa Checkout, Visa took a different approach. One option was to focus purely on speed, and either acquire a smaller company or create a separate skunkworks. But this would have lost the advantage of size.

The solution was to go for size and speed. Lara Balazs, SVP of North America Marketing, leveraged Visa’s brand and market position to recruit a team of top talent, forge strategic alliances with market leaders, and create widespread awareness in the market. Although size was an advantage externally, it was a disadvantage internally. To leapfrog the competition, she had to move fast, but she also needed the involvement of twelve different departments. She had to go fast and go together. Her solution was to rip up the org chart, creating a “team of teams” with a new kind of culture for Visa that emphasized agility and experimentation over consistency and compliance.

Profit and purpose. Purpose has become popular for many reasons. It helps to re-energize leadersengage millennialsinvigorate brands, and demonstrate corporate social responsibility. But purpose still seems like a “nice to have” or something done on the side. Corporate boards still focus on quarterly earnings.

Faced with the choice between profit and purpose, some executives are making the move to social enterprises where profit and purpose are more intertwined. However, the evidence indicates that for-profit companies with a strong sense of purpose have better financial performance. So how can companies in traditional industries achieve both?

For most financial institutions, profit is the purpose. But Wells Fargo has a purpose behind profits.  According to CMO Jamie Moldafsky, “every employee at Wells Fargo is focused on helping our customers succeed financially.”  This approach is reflected in initiatives such as “Untold Stories” which fulfill this purpose in local communities. Echoing their logo, Wells Fargo promises to “never put the stagecoach ahead of the horses.” Proving that they have successfully transcended the tradeoff, Wells Fargo consistently outperforms it’s less purposeful peers.

Toymaker Goldieblox shows that purpose can fuel market disruption. Their mission to increase the number of women engineers led to an entirely new kind of product that combines storytelling and building. According to Lindsey Shepard, VP of Sales and Marketing, GoldieBlox is about encouraging girls to “think about themselves as innovators that can build their own future.” The result is a disruption in the proverbial “pink aisle.”

Airbnb is also fusing profit and purpose, disrupting (at least initially) the hospitality industry. Just a couple of years ago, people considered it strange to stay in a stranger’s home instead of a hotel. But according to their Chief Marketing Officer, Jonathan Mildenhall, Airbnb is on a mission to change both “behavior and perception” so that people can “belong anywhere.”

For each of these companies, purpose isn’t something on which they spend their profits, or a strategy they devise to make more money. Instead, profit and purpose are intertwined proving that money and meaning can indeed work together.

There is no doubt that these companies have all made hard choices in executing their strategies. But the nature of “the hard choice of strategy” has changed in today’s marketplace. It’s no longer about giving up something that is important to you or your customer. In many cases, it’s about finding a way to take both paths at once. For that is truly the road less traveled.

Mark Bonchek is the Founder and CEO (Chief Epiphany Officer) of Shift Thinking. He works with leaders and organizations to update their thinking for a digital age. Sign up for the Causeit, Inc. newsletter and follow Mark on Twitter at @MarkBonchek.

Cara France is CEO of The Sage Group, a firm providing marketing and consulting talent to San Francisco Bay area companies, and founder of Marketers that Matter. Follow her on Twitter @SageCEO.

Originally appeared on Harvard Business Review. Reproduced with permission from the author.

Human Technology: A Founder's Journey

Human Technology: A Founder's Journey

Running a company can be incredibly challenging. I started Causeit in 2006, without a clear vision for the business, but with a remarkably big, broad vision for my work in the world. Having done several years of personal, transformative work alongside academic study in my field of Cyborg Anthropology, I was really clear that I was committed to creating love, joy and community in the world. 

everal years later (seven, to be precise), I'm still constantly attending to the intersection of my personal and business visions, how they play out in the world, and what it means for my team. 

Causeit facilitates Historic Mississippi Business Association After Hours event

A little over a month ago, I headed over to the Historic Mississippi Business Association's After Hours event to meet the business owners and facilitate a sharing event. Dubbed "Speed Networking", business owners would have chance to get to know each other better, and then another, and then another, and then another. . .

Personally, I dislike the idea of speed networking, and not because there's a problem in the interaction itself. We have useful interactions all the time in the bus, elevator, across retail counters that are simple, fast, and cursory. Whether asking for directions, gathering more information in order to make a buying decision, or just asking for clarification, these types of interactions have a useful purpose, but one which is not the goal of 'networking'.

I have a problem with how some people relate to 'speed networking'. This is not a sales opportunity. This is not a time to talk about yourself (surprise!). No, you did not learn everything about this person in the 5 minutes you had to speak. If your goal is to 'know' these people after the short interaction you had with each of them, then you're probably falling short. Like any twitter post, speed networking is really just a means to an end. Exchange contact information, find some points of common ground, and… well, by then your time is almost up.

So why did I accept the request to facilitate a speed networking event? So I could change it, of course! Now, don't get me wrong, it's not my style to deliver something other than the agreed-upon outcome, we still came out knowing each other better, and having met new friends. It's the methodology that I changed.

As a group, we all gave our undivided attention to each person as they recounted not only how they got into their business, but how what they were doing aligned with their passions. Community sharing, after all, is a tradition that dates back far beyond most forms of communication technology we use today, and it's lasted this long for a reason. Ask any person present that evening if they remember each other, and I'll bet you'll hear a lot more details than you can recount of your last 'speed networking' event!

Ars Technica Releases Excellent Critique of McCain Technology Policy

Ars Technica has released a comprehensive evaluation of McCain's technology policies. Check it out and research Net Neutrality, RIAA War and Sharing and other issues. In contrast, Ars Technica also reviewed Obama's technology policy, which includes provisions for more equitable access to high-speed internet in economically depressed areas and highly ambitious reform plans for our nation's technology infrastructure and government use of technology—including transparency provisions.

McCain's Tech Policy

Obama's Tech Policy