Strategy Is About Choices & Tradeoffs
and why Pokémon gamers are better at strategy than you
Hi Readers 👋
Welcome to the 11 new subscribers on this corner of the internet!
Another essay is hot out of the oven (i.e. my brain). This time, let’s talk about strategy.
There are many books and literature about strategy and business. But, there’s no clear primer about ‘strategy’ itself.
I believe a video game like Pokémon can illustrate a key idea about strategy: it’s about making choices.
Thanks for reading and would love to read your comments :)
Best,
Ved
Strategy is a difficult topic to explain.
First, there are nearly 2000 books in the ‘Business Strategy’ category. But this extensive literature has created ambiguity around the word ‘strategy’.
Why? Because not all business books are about strategy.
Management, Marketing, Leadership, Product, HR, Operations, Culture, and many other disciplines are key business areas. They can be strategic. But, they do not explain what strategy is. Nor, how to make one.
And yet, many frameworks, business cases, and books go deep into tools like Porter’s 5 Forces and applied concepts like Blue Ocean Strategy, that skip the basics.
On the /strategy subreddit, there are multiple threads of book recommendations. While some are worth reading, I have three problems with these book lists:
Heavy Time Investment: Who has time to read all of these books?
Unclear Reader Context: What base level of knowledge is the reader expected to have? What’s their goal with this ‘strategy’ knowledge?
Lack of Structured Curriculum: Is there an order to read these books? Will any book do the job?
Second, strategy is used in multiple contexts. In business, there are three kinds of strategy:
Corporate - what products and customers will you serve?
(e.g. industry to play in, region)Company - what will you do to outcompete other players selling similar products and services?
Functional - what will each department do to support the company’s objectives? (e.g. Sales, HR)
For non-business scenarios, the variety ranges from election campaigns to even video games.
This versatility creates confusion. As a result, strategy can be mistaken to be:
Vision
Tactics
Culture
Mission
Strategic plan
Operational Effectiveness
This confusion can lead to, as Richard Rumelt puts it, ‘bad strategy’.
So, What Is Strategy?
Strategy is deciding on an aligned set of actions to have an enduring competitive advantage.
To make one, you need to identify the key problem(s) to solve for achieving the ambitions and goals of someone. That someone can be you, your employer or even a friend.
Strategy is the creation of a unique and valuable position, involving a different set of activities.
- Michael Porter, in What is Strategy?
Strategy is concerned with ‘What to do to achieve one’s goals?’ vs 'How to do this?’ (planning)
To unpack this statement, we’ll examine one idea: choices.
Strategy Is Making Long-Term Choices with Tradeoffs
Making a strategy is different from tactics because of its long-term nature.
Making choices long-term answers ‘what to do’, keeping in mind constraints and winning criteria for you or your organization. A strategy is proactive.
(vs tactics which are short-term and reactive.)
To illustrate this long-term nature, let’s use Pokémon, the RPG pocket monster game.
How to be a Pokémon Champion? It depends
One of the game’s main objectives is to become a ‘Pokemon Master’ and to be ‘the very best’. To hit this objective, you have two activities:
Capture Pokémon and build a 6-member team. You can rotate members from your roster when you have captured more than 6.
Battle other Pokémon trainers and train your team.
To win the game, you must challenge and defeat the bosses (e.g. The Gym leaders) in the game:
But being ‘the very best’ is not a strategy. That is a fluffy slogan.
To craft a strategy, we not only need a defined goal but also constraints. And in Pokémon, your key constraint is your team: you can only battle with a 6-member team.
While you can switch your roster members around, it creates additional considerations for your team selection:
The time and energy invested in training each team member.
The specific properties of each member and what role they play in your team.
(Specific properties like the element type of the Pokémon)
A simplified ‘Rock-Paper-Scissors’ Type Chart (Source: tvtropes.org)
A parallel can be drawn in business when recruiting for a team/project:
You have limited time and energy (also money is a big constraint)
Different employees have strengths and weaknesses.
(e.g. seniority, skillsets and temparements)
As a result, these constraints affect your team composition and overall experience of the game. I want to highlight two extremes of a strategy that a player can adopt, with their trade-offs.
In case you are unfamiliar with Pokémon or want to understand the game in more detail:
Option 1: Diversified Team
Here, a player chooses a diversified strategy:
My team balances each other’s strengths and weaknesses. I can rotate my roster with different members depending on the conditions of each boss battle.
They build their team around each key battle they face and invest in a rotating roster. The advantage is that each boss battle is planned for beforehand to maximize advantages like element typing.
But, here’s a drawback: this is time intensive.
You spend time across many activities. From researching boss rosters to investing training time into team members you may never use.
As a result, you may struggle to win the game quickly.
Option 2: ‘One Man Army’ Team
An alternative strategy would be choosing one ‘champion’ Pokémon to carry the team’s battles. This could be your ‘starter’ monster, which you receive at the start of the game.
I will train and battle with only one Pokémon, like my starter. I will focus all my training efforts on him/her and will not waste time on type-matching for key battles or capturing extra team members.
This is more efficient because instead of training rosters worth of teams, you focus on 1-2 key players to maximize your efforts and their levels. Your champion Pokémon will be over-leveled compared to most boss battle teams, nulling any significant type of disadvantage.
Similarly, in early-stage startups, there can be a high reliance on ‘champion’ employees who carry the company forward as their ‘rockstars’. If not on an employee, this role may fall on the Founder themselves.
But, your team is unbalanced. And, when your champion loses, your team is in danger.
Closing Thoughts:
This is the first point about strategy: it’s a series of choices with tradeoffs.
It has nothing to do with vision & goals. Instead, it’s about long-term decisions and what activities your strategy dictates.
As shown in Pokémon, while both strategies can ‘win’ the game, they create sizable trade-offs. The game experience will differ, but as long as they fit the objective of the player, they both work.
Likewise in business, there are problems where the desired outcome is clear: “we need X% increase in sales”. The question is what will you do to achieve this target. It can range from increasing marketing expenditure to launching an entirely new product.
Open Question: how do you build a strategy when ‘how to win’ is less clear and more open? For more nuanced problems, a structured problem-solving process is needed.
That’s for another essay: how to create a strategy.
Go deeper:
1. Michael Porter’s What Is Strategy?
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You're right on here... from my own notes:
Most failures in strategy are failures in not making choices or recognizing trade-offs. It about saying “yes” to something and “no” to other things. When you don’t choose, people will choose at random, for you.
People also want to have it all. They think choices are positive or negative. But there is always a cost in a choice and you must be willing to pay the price.
P.S. I'm a fan of 'Good Strategy, Bad Strategy' by Rumelt.