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Note: This document was used in support of a live discussion. As such, it does not necessarily express the entirety of that discussion nor the relative emphasis of topics therein.

What’s the Big Think? Structured Thinking for Impact

Andrew Feinberg Chief Strategy Officer Consumer Financial Protection Bureau

•  Peter Orszag (Fmr. OMB Director)

•  Karen Mills (SBA Administrator)

•  Susan Rice (National Security Adviser, Fmr. UN Ambassador)

•  R. James Woolsey, Jr (Fmr. CIA Director)

•  Mitt Romney (Fmr. Governor of Massachusetts)

•  Meg Whitman (eBay CEO, Senate Candidate)

•  Jeff Immelt (CEO, GE)

•  William Hague (Foreign Secretary, United Kingdom)

•  Jim Cook (Founder, Boston Beer Works)

•  Benjamin Netanyahu (Prime Minister, Israel)

•  John Legend (Musician)

•  And lots of other corporate CEOs

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All were indoctrinated into the problem-solving methods you are about to learn

What Do the Following People Have in Common?

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Why Structured Thinking Matters

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Move from… …Towards

•  Rigorous processes •  Haphazard approaches

•  Efficient and targeted effort

•  Spinning your wheels

•  Clearly defined questions •  Opaque and undefined problems

•  Generating deep and relevant insight

•  Answering the wrong question

Work “Smart”

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q  Money - 20% of people have 80% of the wealth

q  Crime - 20% of criminals commit 80% of crimes

q  Energy - 20% of population uses 80% of energy

q  Competition - 20% of suppliers have 80% of market share

q  Carpet - 20% gets 80% wear and tear

 The “80 / 20 Rule”—what it is and where it comes from…

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Efficient Trying to be perfect

Benefit for impact

Collective responsibility to avoid

A Basic Approach…

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S

Situation

C

Complication

Q

Question

R

Resolution

Gain the Necessary Context

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S  What is a “Situation Statement”? •  Quick background on the issue in question—

the status quo

•  Non-controversial (gets the collective in an ‘agreeing’ frame of mind) •  Can be compliment before tougher message •  The foundation, or the starting point, for the

story

Case Study: Blockbuster Video

Situation •  The year is 1999 •  Since entering the movie rental

business in 1985, Blockbuster has become the world’s largest retailer of home movie rental market, with: q  7,200 stores around the

world q  Nearly 100% recognition

with “active renters” in the U.S.

 Tip of the Trade •  “Just the facts ma’am, just the facts”

Sergeant Joe Friday, Dragnet


•  Blockbuster is currently the world’s leading retailer of rental home movies…

Complication

•  Mixed financial results: q  Net income & operating

income negative ‘97-’99 q  EBITDA positive

•  Disruptive technologies have emerged: q  Increasing DVD adoption q  Increased broadband

connectivity q  Emergence of DVRs

S

Frame the Problem

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C

Activity:

Take 2 minutes to collaborate with your neighbor and develop a list of sample

complications…

 Tip of the Trade •  The framing should make the connection

between the situation and question seamless…

 “So What”? Why does it matter? •  Ask yourself and your colleagues, “in what

way is the current situation causing complications?” or “What is the problem we are trying to solve? •  Key change in the status quo that creates

the need for problem-solving •  Can be a positive (e.g., new opportunity) or

negative change (e.g., a new threat)



•  The company has experienced mixed financial results in an environment of emerging disruptive technologies…

Question

•  Are these technological changes directly impacting financial results?

•  Should Blockbuster direct investments away from brick and mortar stores and towards new technologies?

S

C

Activity: Take 2 minutes to collaborate with your neighbor and craft a

question statement

 Ensure Relevance •  Ensure that the question being defined is

the most relevant question to the situation and complication laid out in previous steps •  Make the question specific •  Focus on what information the decision-

maker needs to move forward

Ask the Right Question

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Q

 Tip of the Trade •  Don’t give in to your in-coming bias for a

particular action—leverage the framework to expand your thinking

Question Context

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Q Question to be resolved •  Specific aims / objectives that will solve the problem

Decision makers •  What audience are you addressing?

•  Who needs to decide / act?

Criteria and measure for success •  How would the decision maker judge a

successful problem solving effort?

Key forces acting on decision makers •  What are their concerns / issues around the

decision

Timeframe for resolution •  How quickly is the answer needed?

Boundaries and constraints •  What is not under consideration or off limits

Accuracy •  What level of accuracy is needed

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Question Context: Blockbuster

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Q Question to be resolved •  Should Blockbuster direct investments away from brick and mortar stores and towards new

technologies?

Decision makers •  Global management team and Board of

Directors

•  Chief Strategy Officer

•  Chief Technology Officer

Criteria and measure for success •  Clear and compelling analysis that includes

an analysis of current state of industry, future trends, and cash flow projections for proposed investment

Key forces acting on decision makers •  Concerns include long-term financial viability

and quarterly earnings pressure

•  Analysis must clearly identify short- and long-term costs and benefits

Timeframe for resolution •  An initial analysis must be completed in

time for the next Board meeting 4 weeks from today

Boundaries and constraints •  Company will not be able to exit VHS market

for 18 months due to existing studio contracts

Accuracy •  “Beyond a reasonable doubt”

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•  The company has experienced mixed financial results in an environment of emerging disruptive technologies…

•  Should Blockbuster direct investments towards new technologies?

Resolution (Hypothesis)

•  Blockbuster should shift focus from growing, expensive, brick & mortar stores to building new, more efficient technology-enabled channels

S

C

Q

Activity: Take 2 minutes to work with your

neighbor and craft a resolution statement (or hypothesis)

Articulate the Resolution

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R  Don’t just guess… •  Review all previous experience for analogs

that might inform your hypothesis; analogs can come from: ð Your personal experience ð Prior Bureau work ð Other government agencies •  If necessary, contact subject matter experts

outside of your direct network

•  Test your hypothesis with colleagues before conducting deep research and analysis

 Tip of the Trade •  Ensure that your hypothesis is “testable”;

data should exist to prove or disprove your theory

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•  Use 80 / 20 Thinking

ð Avoid “boiling the ocean” or “polishing dirt”

ð Acquire just enough data to sufficiently prove your point beyond a “reasonable doubt”

•  Collaborate: share good ideas with the team and work together towards solutions

•  Anticipate Obstacles… don’t do a Titanic

•  Use experts as data / strategy sources

•  Leverage your colleagues!!! Tap the creativity around you; in many cases they have thought through the problem you are trying to solve

Best Practices for Analysis

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Career

NextGen: Learn to consult like an expert