Cracked it!

Bernard Garrette • Corey Phelps • Olivier Sibony

How to solve big problems and sell solutions like top strategy consultants

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Book Details
 3.00 USD
 295 p
 File Size
 4,061 KB
 File Type
 PDF format
 978-3-319-89375-4 (eBook) 
 The Editor(s) (if applicable)
 and The Author(s) 2018  

Business leaders praise Cracked It!
“When dealing with a major business issue, every decision maker is facing his own
cognitive biases, rooted in experience and personality. In Cracked It!, the authors
not only remind us of the importance of challenging even obvious solutions or
ideas, by taking a step back, thinking differently, and walking in the other’s shoes –
be it a customer or an audience – but they also provide practical, value-creating and proven insight.”
—Stéphane Richard, Chairman and Chief Executive Officer, Orange
“The future is no longer what it used to be. The business world is undergoing unprecedented
disruption. Every problem is more complex. Cracked It! will be the bible of
the true problem solvers.”
—Daniel Bernard, Former Chairman and Chief Executive Officer, Carrefour
“If you want to master problem solving, buy this book. It will save you from coming
to sloppy conclusions and guide you through every aspect of the process of solving a
problem. I used it the day after I started reading it.”
—Neil Janin, Chairman, Bank of Georgia, and Senior Partner Emeritus, McKinsey
“Too often at the Board or executive level, time is wasted looking for solutions to
a problem which has not been clearly defined. Garrette, Phelps and Sibony provide
a structured approach to defining problems which should prove useful to practitioners.”
—Paul M Tellier, Former Chief Executive Officer, Bombardier
and Canada National Railways

Thought leaders praise Cracked It!
“Too many companies fail because of bad strategy. This book is full of frameworks
and tips to help you avoid that fate.”
—Adam Grant, New York Times bestselling author of Give and Take,
Originals, and Option B with Sheryl Sandberg
“Written by a trio of leading experts on strategy who draw both on decades of rigorous
academic research and consulting experience, Cracked It! offers a crystal clear
approach to frame and solve challenging strategic issues. A must-read for executives,
consultants, business school students and leaders in charge of transforming their organizations.”
—Laurence Capron, Professor of Strategy and Dean of Faculty, INSEAD
“CEOs regularly pay a king’s ransom to the top management consulting firms for
help in solving their most complex problems. You may not have the consultant’s connections
or their knowledge of the industry, but this book will help you learn the
secrets of their problem-solving process so you can tackle your own problems more effectively.”
—Chip Heath, Coauthor of Switch and The Power of Moments
“Why do smart and experienced executives sometimes make spectacularly bad decisions?
This book exposes the flaws in analysis that lie at the root of the problem.
Building on deep academic insights and lots of real-world experience, Garrette,
Phelps and Sibony lay out a structured problem-solving approach to overcome the
many pitfalls that executives fall into. They don’t just tell you how to get the analysis
right, they also explain how to sell your advice to others. An invaluable guide to anyone
who is involved in decision-making in the business world today.”
—Julian Birkinshaw, Author of Fast/Forward, Professor and Deputy Dean,
London Business School
“This is a GREAT ‘how to’ book for tackling strategic problems and becoming a better
strategic thinker. It not only describes all the major frameworks used by strategy
analysts, but also shows their pitfalls and how to decide when a particular framework
will be useful. All of the concepts in the book are also demonstrated with real case
studies that bring the process of strategic analysis to life.”
—Melissa Schilling, Author of Quirky and Herzog Family Professor of Management,
Stern School of Business, New York University
“Problem solving is a critical skill for managers and entrepreneurs and often underserved
in business education. Cracked It! does a phenomenal job in presenting a full
problem solving framework grounded in sound theory, tested in years of practice and
fun to read.”
—Franz Heukamp, Dean, IESE Business School

Strategists praise Cracked It!
“A fully comprehensive and practical introduction to problem-solving tools and
—Georges Desvaux, Senior Partner and Managing Partner,
Africa, McKinsey & Company
“Strategy is problem solving – an important, subtle and pervasive skill for which business
practitioners receive little formal training. Garrette, Phelps and Sibony provide
a valuable and practical guide to the art, from framing the problem through to communicating
and selling the solution, which should be invaluable to practitioners and consultants.”
—Martin Reeves, Director, BCG Henderson Institute
“A great read for all current and future business leaders! The secret sauce of solving
hard problems and selling solutions to drive change is at your doorstep. Just go get it!”
—Eric Gervet, Lead Partner, AT Kearney, San Francisco office
“The companies that win will be those that use superior problem solving tools.
Cracked It! teaches you how. It captures the real world experience of successful problem
solving and presents the learnings in an engaging style.”
—Rima Qureshi, Executive Vice President and Chief Strategy Officer, Verizon
“The ABSOLUTE reference handbook on problem solving! It is clearly unique and
it smartly introduces an amazing richness of methods, through cases and easy to
understand frameworks. I have to say… I love it!”
—Jean-Baptiste Voisin, Chief Strategy Officer, LVMH
“In an uncertain world that defies comprehension, we are forced to make intuitive
decisions… but our problem-solving process must be rational. Therein lies Cracked
It! ’s greatest value. Readers will learn how to shape an effective problem-solving process
to channel intuition into rationality and avoid the mistakes that ensnare the
amateur strategist.”
—General Vincent Desportes, French Army

Table of Contents
1 The Most Important Skill You Never Learned 1
Fast and Slow Problem Solving 2
Problem Solving and the Expertise Trap 5
Complex Problems and “Unknown Unknowns” 7
The Need for a Disciplined Problem-Solving Process 10
Chapter 1 in One Page 12
2 The Five Pitfalls of Problem Solving 15
Case 1: When the Music Industry Went Out of Tune 15
Pitfall 1: Flawed Problem Definition 16
Case 2: The Grameen–Danone Strengthening Yogurt 18
Pitfall 2: Solution Confirmation 21
Case 3: The Call Center Story 22
Pitfall 3: Wrong Framework 23
Case 4: New Strategy at J.C. Penney 25
Pitfall 4: Narrow Framing 26
Case 5: A Fat Chance for Sugar 29
Pitfall 5: Miscommunication 32
Chapter 2 in One Page 33
3 The 4S Method 35
Where Does the 4S Method Come from? 35
An Overview of the 4S Method 41
State: A Problem Well Posed Is Half-Solved 43
Structure: The Architecture of Problem Solving 44
Solve: Between Analysis and Creativity 46
Sell: Choose the Approach That Suits Your Audience 48
Chapter 3 in One Page 51
4 State the Problem: The TOSCA Framework 53
Trouble: What Makes This Problem Real and Present? 54
Owner: Whose Problem Is This? 57
Success Criteria: What Will Success Look Like, and When? 58
Constraints: What Are the Limitations and Trade-Offs? 60
Actors: Who Are the Stakeholders? 61
Write the Core Question 62
Singing TOSCA as a Choir 65
Chapter 4 in One Page 67
5 Structure the Problem: Pyramids and Trees 69
Hypothesis-Driven Problem Structuring 71
Building a Hypothesis Pyramid 72
Hypothesis-Driven Problem Structuring: Pros and Cons 79
Issue-Driven Problem Structuring 84
Growing Issue Trees 86
Growing a Tree or Building a Pyramid? 89
Chapter 5 in One Page 92
6 Structure the Problem: Analytical Frameworks 95
Using Frameworks to Breakdown Problems 96
The Danger of Frameworks: Frameworks as Mental Models 99
Industry Frameworks: Value Drivers 101
Functional Frameworks 105
When All Else Fails, Try Good Old Logic 113
Chapter 6 in One Page 115
7 Solve the Problem: Eight Degrees of Analysis 117
From Structuring to Analyses 117
Eight Degrees of Analysis 121
Planning the Work 125
Conducting the Analysis 126
Chapter 7 in One Page 136
8 Redefine the Problem: The Design Thinking Path 139
Design Thinking and When to Use it 142
Five Phases, One Mindset 144
Phase 1: Empathize 147
Phase 2: Define 156
Chapter 8 in One Page 165
9 Structure and Solve the Problem Using Design Thinking 169
Phase 3: Ideate 171
Phase 4: Prototype 182
Phase 5: Test 186
Chapter 9 in One Page 191
10 Sell the Solution: Core Message and Storyline 197
Don’t Tell the Story of the Search, Tell the Story of the Solution 198
The Pyramid Principle 200
Pave the Way for a Dialogue 204
Design Your Storyline 205
Go for Either a Grouping or an Argument 213
Chapter 10 in One Page 220
11 Sell the Solution: Recommendation Report and Delivery 223
Manage Communications Throughout the Process 224
Beware the PowerPoint Curse 225
Create an Effective, Modular Report 226
Develop the Content Pages 230
Make Quantitative Charts Relevant and Simple 233
Use Conceptual Charts Sparingly 241
Trim the Deck Ruthlessly 241
Quality Control 243
Beyond Slide Presentations 243
Chapter 11 in One Page 248
12 The 4S Method in Action 251
Case Study: The Kangaroo Opportunity 251
What Is the Problem? 255
Structuring the Problem 257
Solving the Problem 257
Selling the Solution 259
Appendix: First Section of a Report on the Kangaroo Case Study 263
13 Conclusion: Becoming a Master Problem-Solver 271
Index 275

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As strategy professors, we interact with a broad range of audiences, from
undergraduate students to MBA participants to senior executives. Despite
very different backgrounds and expectations, all of them consistently tell us
that they struggle with a common challenge: how to apply what they learn.
Our students tell us that the tools and concepts of business management
are relatively easy to understand. Analyzing the structure of an industry or
assessing whether a company has a cost advantage is not, after all, an extraordinary
intellectual challenge for people who often have advanced degrees in
non-business fields, not to mention many years of successful experience.

When the time comes to apply the same tools to real business situations, reality
does not conform to the stereotype presented in the textbooks—or even to
the stylized examples presented in case studies. The problems business people
face are complex. Situations are ambiguous. Facts are unclear. Expectations
change quickly. Whether it is learned in school or on the job, business knowledge
provides executives with a treasure trove of frameworks. But it does not
help them to recognize and make sense of the problems.

In 2014, we set out to fill this gap by developing a course on problem solving
for the core curriculum of the HEC Paris MBA. We soon realized we
needed to address aspects of business communication as an integral part of the
course, for reasons that will become clear as you read this book. After many
iterations and refinements, the course morphed into the method described in this book.

A significant inspiration for this book is the problem-solving method developed
and refined over many years by McKinsey consultants. Because the very
nature of top management consulting is to help senior executives make sense
of the toughest problems they deal with, problem-solving proficiency is at the
heart of what McKinsey consultants do. Like almost everything in this extraordinary
firm, it is passed on from generation to generation, in the spirit of
apprenticeship. Olivier is immensely grateful to the masters who taught him
the ropes as a young consultant, but also to all the colleagues, from the partners
to the summer associates, who challenged him in countless team meetings
over a quarter century.

We are indebted to the hundreds of students and executives who participated
in our problem solving and communication seminars over the past few
years. Not only did they force us to clarify and refine our thinking continuously,
but they also kept telling us that something was missing: the course was
long enough to make them aware of the need to hone their problem-solving
skills, but too short for them to become familiar with all the tools and techniques
required. Where, they asked us, is the book they can read to become
better problem solvers? We hope the answer is now in your hands.

Many parts of this book benefited from the input and wisdom of colleagues.
To name only a few, we would like to thank Blaise Allaz, Pierre
Dussauge, Thierry Foucault, Andrea Masini, Anne-Laure Sellier, and Mathis
Schulte, who have been instrumental in extending the scope of our problem-solving
views toward their respective areas of expertise. More generally, we are
indebted to all our colleagues at our home schools—HEC Paris and McGill—
as well as to friends and colleagues from other institutions we collaborate
with, such as IESE and Saïd Business School, who engaged in stimulating
conversations with us at various stages of the project. 
We insist that all remaining errors are ours.

We also benefited from research support from HEC Paris, the HEC
Foundation, and the Desautels Faculty of Management at McGill University,
which we gratefully acknowledge.

Turning a classroom experience into a book is an interesting challenge. We
hope this book has retained some of the “hands-on” feel that we strive for in
our teaching, while following the conventions that make it possible for a
reader to navigate it easily. If we’ve had any success in this endeavor, our editor
Jennifer Worick deserves much of the credit. Isabelle Huynh, our visual editor,
helped us convert our cluttered slides into the elegant visuals you will
discover. We are also grateful to Stephen Partridge and Gabriel Everington of
Palgrave Macmillan for their patient and supportive work.

Working on a book is like any relationship—it requires care and attention,
and sometimes, it can become all-consuming. It can provide joy one
day, and frustration the next. It can also impact other relationships and
benefit from them. Bernard wants to thank Béatrice for her loving care and
support, especially in the challenging personal circumstances that surrounded
the completion of this work. Corey’s wife, Tiffany, and kids, Chloé-Rose
and Connor, went through a lot and did a lot to support him during
the project, for which he is extremely grateful. Olivier is equally grateful to
Anne-Lise, Fantin, and Lélia for their unfailing encouragement and patient support.
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