Moneyball: Business Edition

July 13, 2023

This is one of my all time favorite scenes from movie history:

What does this scene teach me? Change happens slowly, then all at once. 

Today, we're chatting about a way to think about that change - via a wonky concept called the “Value Disciplines Model”.

Snooze fest, right?!?

BUT, I think this concept is very important for you first principles thinkers out there.

This model really helps me think about business strategy - and it has a huge tie in to global talent.

The Value Disciplines Model is the brainchild of Michael Treacy and Fred Wiersema, from their book "The Discipline of Market Leaders".

It's all about finding your strategy as a business and focusing on doing one thing really, really well.

There are three main strategies to choose from:

  1. Customer Intimacy (Focus on Service) - Customer intimacy about getting to know your customers on a deep level and making your products or services to better serve them. Think LuluLemon - owns a range of products serving the same customer - affluent upper middle class active men & women.

  2. Product Leadership (Focus on Innovation) - This is the strategy for innovators. Product leadership strategy is all about delivering the next big thing before anyone else does. These companies live in the future, they take risks, and they reward innovation. Think Apple, or Tesla. Trying crazy shit, and hoping it works.

  3. Operational Excellence (Focus on Cost) - The tortoise in the famous race, businesses with this strategy are all about efficiency and cost-effectiveness. They might not be flashy, but their streamlined operations and wallet-friendly prices endure. Ever wonder how Walmart or McDonald's can keep their prices so low? It's operational excellence.

Now, let’s tie that in to Global Talent, my favorite topic.

As you are developing your business’ strategy - how can Global Talent accelerate one of these strategies?

  1. Global Talent & Customer Intimacy - As just one example, a global team can provide 24/7 customer support to your most important customers. With customer service personnel across time zones, you're equipped to deliver that personal touch whenever your customers need it. Businesses like Zappos have already harnessed this strategy, offering legendary customer service 24/7 through a global team. Imagine if you assigned one global talent “Key Account Manager” to your largest B2B customer. Their job? Make buying from you and working with you as easy as possible. Think about the great things they could do! Increase LTV, reduce churn, etc

  2. Global Talent & Product Leadership - There are probably ways to use it for this strategy, but not as clearly as the other two strategies, so I’ll skip it.

  3. Global Talent & Operational Excellence - I mean, this is the obvious one, of course. Imagine if your competitors have to staff $100,000/year people to provide a service, and you staff $30,000/year people. What kind of wonderful ways could you outcompete them? Whether that is triggering a price war, that you can win with a strategic advantage, or plowing those savings into customer acquisition and out market them… you have a lot of room to play. I can think of LOTS of strategies here - and have been involved in strategy formulation like this for PE, VC dudes, and business owners. The most exciting strategy I’m seeing now is in the competition for skilled labor. Need to recruit more HVAC technicians for your LLM rollup? Pay 20% above market to the technicians, and take that 20% from having your whole accounting team based globally. No increased costs, but now you can beat your competitors in the war for skilled talent.

Hopefully this gave you something to chew on.

I hope you view global talent as a way to strategically improve your company, not just “Schedule my meetings, bro”.

Yallah Habibi,

Jon

P.S. Coaching is fully booked for awhile.

Passage of the Week: