Why is Strategy a Game of Big Bets, and How to Make the Right One?

Do you like pizza? Be honest!

Perfect! Then we have something good for you.

The year is 2008, and Domino's faces a major brand crisis. Their stock prices have reached an all-time low, and their company debt is $1.7 billion. Customers share everywhere that their pizza is just… bad – "crust that tastes like cardboard" and "sauce that tastes like ketchup."

It looks like desperate times, doesn’t it?

But then, to make matters worse, a video of employees contaminating pizza ingredients in the most absurd and disgusting way goes viral. The crisis is no longer only financial; it’s also a PR nightmare.

The CEO, J. Patrick Doyle, takes immediate action: 

“You can either use negative comments to get you down, or you can use them to excite you and energize your process to make a better pizza. We did the latter.”

Domino’s isn’t just considering a slight pivot. They’re heading for a full-blown rebrand, starting from scratch. One of the riskiest moves they make is publicly acknowledging that their pizza is no good through the Pizza Turnaround campaign. It’s simply a video campaign showcasing real customer complaints and addressing them with a promise for improvement.

Quickly, Domino's develops a completely different recipe based on customer feedback, insights, and research. They even take a step further by implementing radical transparency in their delivery process through their patented delivery tracking system. Finally, they digitize their entire business for a better and faster customer experience.

In 2022, almost 91.2% of their purchases were made online — a true testament to a digital-first business.

Domino’s story is one of many examples that show why strategy is not a prediction for success. Strategy consists of strategic bets that hide significant risks and potential rewards. As a business leader, your main responsibility is to evaluate the outcomes of your strategic decision and plan for execution that will match your aspirations.

Strategic bets are big business decisions to reach important, long-term goals. These bold moves require a lot of resources — like time, money, or skilled people. The expected outcome is to give the company a strong edge or solve key problems. Unlike everyday decisions, strategic bets involve calculated risks and possible rewards because they’re based on predictions, insights, and data about an uncertain future.

But how do leaders make these big bets?
Is it reckless gambling or a well-calculated intent?
How do you plan for the best outcomes when the future is unpredictable and always changing?

These are valid questions, and we'll dive deeper into them in the next few sections.

Any strategic bet can turn into gambling. Let’s think about it… gambling and strategizing have common traits. They both:

• involve making choices without full knowledge of the outcomes
• rely on assessing potential risks and calculating odds before making a decision
• recognize the importance of long-term gains over short-term wins
• offer a learning opportunity after every loss or setback

However, making a strategic bet is different than gambling:

• Gambling relies on chance and luck. Strategic outcomes on skill, data analysis, planning, and execution
• Gambling’s goal is always to generate more money. Strategy is about generating value.
• Control is limited in gambling. In strategy, while the future is uncertain, you still have control over internal factors like budgets, resources, and people.
• In gambling, decisions are rapid, emotional, and short-term. In strategy, decisions are usually well-informed and often made in favor of the long-term strategic outlook.
• Gambling relies on data, but it is usually random and uncertain. In strategy, you use reliable data and insights to inform decisions.

Gambling is an emotional and impulsive process. Emotions can cloud judgment and turn decisions into impulsive choices. In business strategy, quick and emotional decision-making without considering reliable information could mean gambling with your company’s future. As a strategist and leader, you must rely on data, insights, and controlled risks.

In contrast to gambling, well-founded strategic hypotheses, resource evaluation, and contingency planning should drive business strategy. While both require navigating risk, only strategic planning turns uncertainty into manageable, long-term value — something gambling, for all its thrill, can’t reliably deliver. 

Any strategy starts with insights. You know it's time for a change when you realize your company’s problems and are ready to confront them head-on. Big bets never happen while you’re in your comfort zone. They happen when you feel a significant discomfort that keeps you up at night.

"I still remember getting everybody into this room and saying, 'Folks, we gotta make a change.' We've got to do something different. Let's start from scratch." - J. Patrick Doyle

Here’s a structured playbook-type list of everything that happens during the strategic planning phase:

Step 1: Analyze the current state

Start with a rigorous assessment of internal and external factors that affect your business health. Many companies use SWOT or PESTLE analyses at this stage to guide their understanding.

Step 2: Insight and reflections

Once you gather the data, you must turn it into insights and deeply reflect on the interpretation with your leadership team. This is the time to challenge the status quo and identify core issues and new opportunities.

Step 3: Generate strategic bets

Strategic bets are your ideas or assumptions on how to create meaningful change. This step involves brainstorming potential strategic initiatives. Focus on the bets that challenge your assumptions and offer the highest impact.

Step 4: Risk assessment and contingency planning

High-stakes strategic bets can be risky, so the strategy must be resilient. You can achieve this by identifying risks, setting up contingency plans, and establishing risk tolerance levels.

Step 5: Evaluating resources and picking the right strategic bets

Analyzing your budget, talent, technology, and operational capacity helps you make the strategic choices that could bring success. This stage helps narrow hypotheses to those that align with organizational strengths and capabilities. Always focus on strategic depth and choose strategic bets that, if validated, will shift your strategy for greater outcomes.

Step 6: Set strategic goals, KPIs, and expected outcomes

Once you decide on the direction, set clear and measurable goals with associated outcomes and KPIs to keep track of the strategic initiatives. These goals and KPIs serve as benchmarks for success and guide the tactical steps for executing the strategy.

Step 7: Communicate the vision and strategy

This step involves aligning everyone around the strategic direction and ensuring they understand their role in achieving it. The more transparent communication, the easier it is to navigate resistance to change.

Step 8: Alignment and commitment

Your leadership is fully onboard. But at this point, you need to secure buy-in from key stakeholders. To foster commitment and minimize resistance, you’ll have to work hard on aligning incentives, clarifying roles, and building a sense of shared mission.

Step 9: Implementation

This is where strategy meets action. It’s important to break down larger goals into manageable tasks and regularly assess progress against these.

Step 10: Monitor, review, and adapt

Strategy is all about navigating uncertainties. Monitoring performance, implementing feedback loops, and remaining open to course correction help your strategy stay relevant and responsive to changing conditions.

On a playbook, everything looks clear and straightforward. In reality, when you try to escape the status quo, a huge pushback gets in the way - the fear of change.

This is where you need your leadership judgment and influencer skills to convince everyone that this strategic bet is the way to get your company on track.

This is where strategy turns into an interactive game. Each strategic bet becomes a chance to prove or disprove your assumptions. It’s not about winning every time. It’s about learning.

Failing is okay because it means you’ve ruled out the wrong direction and gained clarity on what doesn’t work. 

Honestly, the best way to do so is through practice. Your leadership experience will help you learn on the go and improve with every next strategic bet. Another approach is to trust a strategy consultant who will help you implement best practices along the way.

If you’re open to self-learning, our resource library is a good source of truth for improving strategy management. Here, you can learn in-depth tactics and practical steps to avoid common pitfalls and improve your strategy management.

Ultimately, you can choose to have a reliable AI strategic assistant on your side with Quantive StrategyAI. You don’t have to be buried in books and tabs on best practices. Our strategy management software guides you through the full strategy management process, following best practices (always up-to-date and relevant).

Here’s a quick overview of how it helps you turn decisions into well-calculated strategic big bets and be better at strategy management:

Step 1: Evaluate your current business state

Upload your business docs and get them analyzed by advanced AI.

Step 2: Turn data into insights and possible hypotheses

With the help of built-in decision-making frameworks, quickly assess what risks and opportunities are in front of you.

Step 3: Discuss and pick the relevant hypotheses

Take the ideas offline, discuss, evaluate, and come to a decision with full internal buy-in.

Step 4: Create actionable goals

Turn your strategy into action with a few clicks and intelligent AI capabilities. No more endless meetings to plan and set goals.

Step 5: Generate a one-pager of your strategic direction

Strategy documents shouldn’t be endless PDFs. All you need is a one-pager thoroughly explaining the why, what, and how. With Quantive StrategyAI, you can make it happen in seconds.

Step 6: Share your vision

This will be shared with your team and announced at a company-level meeting.

Step 7: Align and implement

Use the goal alignment view to increase strategic transparency and make the executive as collaborative as possible with tasks, automated goal updates, weekly check-ins, and KPI tracking.

Step 8: Monitor, pivot and adapt

Tracking your strategic initiatives is easy and clear. Integrate Quantive StrategyAI with over 170 data points and create full visibility into business performance. Anticipate risks ahead of time and pivot before it’s too late.

Learn as you go. Because the best teacher is experience. 

Big bets require courage. Along with courage, you need the right insights, internal support, and comprehensive planning. Domino's journey was all about commitment to change, learning from feedback, and a relentless focus on creating value — even amidst uncertainty.

Whether you’re just starting or refining your strategy, remember that success often comes down to one simple truth: adapt, iterate, and keep your eyes on the big picture. With Quantive StrategyAI, you have a strategic advisor who provides insights and helps you convert them into actionable, data-driven steps that make every big bet well-calculated.

So, ask yourself: What’s the next big bet you’re ready to make? Now, ensure it creates lasting value for your business and your team.

The good news is that with the right approach, you’ll know the best big bets to put your chips on.

Ready to transform the way you plan for high-stakes strategic bets? Contact us to learn more about how Quantive can help your organization drive better, faster strategic results.