This animated GIF was created on 29th July 2007 by Sylvain Gadenne. In the context of the Budapest Gambit (an opening in the game of chess), it presents the strategy of pressure against the e3-pawn. It is intended to be used in the Wikipedia article about the Budapest Gambit. (Photo credit: Wikipedia)
“Make sure your resume says that you play chess. It shows you are a strategic thinker,” advised the older businessman to the young man networking into an industry trade group. The young man knew that his next job would largely define his career prospects, and he wanted to get into a position where he could provide impact.
For good reason, chess has become an iconic representation of strategy. Chess is a game that requires structured thinking and deliberation. However, chess is not a perfect analogy for organizational strategy.
The Myth: Chess Strategy is a Linear, Pre-Calculated Plan
A Vice President of OnStar, the General Motors subsidiary, was being interviewed in an article on the topic of innovation for a professional association magazine. Guided by the “overarching business strategy of creating great customer experiences,” he likened “his company’s innovation strategy to the way chess masters approach their game.” He said:
“They decide before they begin what their checkmate will be and work back from that point, unraveling all the moves necessary to get to that outcome. By beginning with a specific goal, they don’t get mired down in the myriad possibilities in front of them.”
Research shows that chess masters do not work with a goal and establish a linear (step-by-step) strategic plan. Here is supporting research cited in the chess entry on Wikipedia:
In his doctoral thesis, Adrian de Groot showed that chess masters can rapidly perceive the key features of a position. According to de Groot, this perception, made possible by years of practice and study, is more important than the sheer ability to anticipate moves. De Groot showed that chess masters can memorize positions shown for a few seconds almost perfectly. The ability to memorize does not alone account for chess-playing skill, since masters and novices, when faced with random arrangements of chess pieces, had equivalent recall (about half a dozen positions in each case). Rather, it is the ability to recognize patterns, which are then memorized, which distinguished the skilled players from the novices. When the positions of the pieces were taken from an actual game, the masters had almost total positional recall.
The de Groot research illustrates well the essence of strategic thinking. In this case, chess acumen – acumen being considered the accumulation of knowledge of useful patterns and key features of the situation – is applied with thinking that is imaginative, systematic, and opportunistic. Chess masters have the ability to perceive, classify, and use patterns.
The context of chess is different from the context of business, games, or war because the patterns of activity are different. Strategic thinkers develop acumen – the knowledge of patterns relevant to their competitive context, and blend it with a cognitive framework. Because the mind structures knowledge differently, the definition of strategic thinking as an individual competency is reinforced.
Reality: Chess Strategy is Developed – But there is a Role for Preparation
Here are some more research insights useful for understanding chess’s application and limitations to strategic thinking.
Eric Leifer, an American sociologist, asked chess grand masters how many maneuvers they pre-calculate. The answer was none to one maneuver. Rather than working backwards from the end point of winning the game; instead, they develop it a move at a time. One obvious reason: chess is a competitive game, and opponent’s moves cannot be predicted.
Chess grand masters build up their game as do their opponents. Leifer asked for the reason for this strategy and got the answer that it is the only way to correct mistakes from the beginning of the game. As each player builds up their game, the winner eventually – in the endgame – finds a maneuver that breaks any resistance and puts the opponent out of action. Leifer found that skilled players seek to preserve flexibility.
This might lead you to believe that chess talent is inborn, and there is no need for planning. But, chess masters do prepare for their matches. What do they do? In planning for a chess match, chess masters spend little time visualizing the win and the steps to get there. Instead, their preparations focus on game development: the patterns of moves in their own games and that of their opponent. Key to this is looking for things that might be habitual, especially regarding the willingness to recognize mistakes, repeat mistakes, and correct mistakes.
Reality: Chess Is Strategic Venturing with Willingness to Say, “How Might I Be Wrong?”
In research described in Nature magazine in 2004, Michelle Cowley and Ruth Byrne found that chess players indeed “mentally map out the future consequences of each possible move.”
Cowley and Byrne found that good chess players do something that is qualitatively different; they invest more time thinking in an imaginatively and conceptual way about their opponent’s response. Specifically, they imagined how the opponent could or would react and exploit whatever weakness is present in their position. Good chess players falsify their own strategies by imagining the competitor’s response.
This expert approach has leadership implications: Experts are constantly testing their approach to find its vulnerabilities, and make their best choices that least-weaken their strategy.
Novices, on the other hand, tend to be blinded by their own optimism. They start telling themselves a story that they will be successful. In the case of novices, hope is a strategy.
Here is a great question that I heard asked by my friend Paul O’Connor when we were interviewing managers at a scientific instruments company: What could your competitor do to you that would totally destroy your business? In this particular instance, we learned that the company’s business thrust into China was very vulnerable, and needed to be made more robust.
More than Deductive Thinking
In my experience, I have seen many people flounder in strategic situations. Much of this can be explained by their preference for (and habits of) deductive thinking. Deductive thinking is a style of thinking where the thinker takes broad principles, rules, conclusions, and truths and “backs into” the facts and arguments that support the outcome.
The VP quoted early in this article appears to be leaning on deductive thinking (“They decide before they begin what their checkmate will be and work back from that point). Perhaps he simply selected a poor analogy for making his point (planning a road trip involves knowing your goals and deducing the best ways to achieve it). Strategy involves recognizing competition and counter moves; moves which can only be guessed at.
Thus, we can see a distinction between long-range planning (the road trip) and strategy (winning at chess). Long-range planning is relatively more deductive; however, it has a limitation because the planner needs useful, valid knowledge as a planning input. Who can predict what an equally talented and motivated competitor is going to do?
Strategy is often frustrating to people who habitually rely on deduction as a style of thinking. As Richard Rumelt points out, treating strategy like a problem in deduction assume that anything worth knowing is already known. To generate a strategy, one must put aside the comfort and security of pure deduction and launch into the murkier waters of induction, analogy, judgment, and insight.
What are the other differences of chess with business strategy? Are there any transferable learnings?