Few topics in business have been more written and talked about and become consequently confused, as strategy. It seems remarkable given all this angst how few organisations have an effective, differentiated, achievable, understandable, actionable plan to achieve their organisational vision or mission.
We see four elements to a good strategy:
Is it differentiated from your competition? Too many organisations adopt a ‘me-too’ strategy that attempts to mimic their competition rather than set out a path to success in the way most appropriate for them. Too often this can be sheeted back to delegating to strategy consultants the formulation of your strategy. Consultants, other than the very best, often spend too much time looking at your industry, market, segment or geography and too little time looking at the unique characteristics of your organisation or your distinctive organisational purpose or vision. As a result you end up with a strategy that looks like everyone else’s and fails to reflect your unique history, capabilities and culture. The answer? Take input, get advice, listen to experts…but design your own strategy, to deliver your own unique purpose.
Is your plan achievable? In particular, is it achievable by you? Too many strategies are empty statements of impossible intent, not descriptions of clear steps or tactics, fitted to the skills and mindset of the organisation, that will lead to the desired outcome. We are also collectively blinded by optimism bias, the belief that because we have convinced ourselves that the past went according to plan, so will the future. Pre-mortems are a key consideration here, carefully thinking through how the plan could go wrong, before it does. Rather than blindly hoping for the best.
Is your plan understandable? Because plans are often dreamt up in dark rooms, behind closed doors, by select groups, it is easy to forget that those same people have a very limited ability to actually execute the plan. Execution relies on the impenetrable middle layer of most organisations not only understanding the plan but being prepared to act on it. Too many plans are poorly communicated by executives who forget that others haven’t been on the same journey to arrive at the plan as they have, whilst also failing to recognise the inherent conservatism and status quo preference of the frozen middle in most organisations.
Is your plan actionable? Too many strategies, whilst they may seem logical, actually, because they have been prepared in isolation of real people, are impossible to execute. The solution…involve people from across the organisation in developing the plan from the outset, so that they understand, agree with and want to help bring it to life. The side benefit is that you will have involved people who actually know how your organisation operates at the coalface and your strategy might actually work.
If you get these four elements in place then you have a shot at achieving an effective strategy, until the world or your competitors or customers move on and you have to start again...but quicker this time, because this cycle just continues to accelerate.