I was recently reminded of a fascinating discussion I had as part of a sports business class. There were many questions from students about business strategy.
The discussion was centred around designing an effective business strategy, which led me to develop this list of tips for developing an efficient plan.
It’s always important to define and understand what success will be. I begin many of my workshops and strategy sessions with a simple question: What does success look like to you?
This reminds me of Lewis Carroll’s 1865 book Alice in Wonderland: If you don’t know where you are going, any road will get you there!
To create an effective business strategy, you must begin by knowing where you are going and what a successful destination will look like.
During the journey, the destination may change. That’s normal! With that said, you must begin with a clear idea of where you intend to head and funnel your choices to suit that target.
It’s also important to recognise that planning isn’t the same as strategy. It’s been said many times, and it’s wisdom that’s worth remembering — planning is merely procrastination.
I often reflect on that idea because I encounter many leadership teams in business worldwide that start every new project with the same philosophy: We need to study and then devise a plan.
The problem with planning is that it never ends! It often leads these teams to build an empirical, top-down ‘strategy’ that is far removed from the realities of the business.
Planning is precisely that — planning, and strategy is about action. No strategy will win without action, and planning stands in the way. It blocks action by prolonging the time before any action can be taken.
The next point of consideration is the importance of maximising participation in the process. You want to encourage a diverse range of voices in your strategy, each offering a unique perspective.
Many businesses fail at strategy because they work on projects structured around the boardroom and ‘commanded’ down to employees from above.
Many successful business strategies struggle to succeed because they must be sold to the workforce, convincing the staff to accept and implement changes.
By contrast, strategies that feel like authentic responses to the real issues and challenges faced by staff members working face-to-face with customers are far more likely to succeed.
Remember that strategies that include feedback and ideas from all levels of a business or organisation, from the beginning of the project until the end, are the most likely to be successful.
Following this concept, we consider that winning strategies are flexible. Are you familiar with the idea of a VUCA business environment? It’s an acronym that stands for volatility, uncertainty, complexity, and ambiguity, and describes the business landscape and the challenges it presents.
Volatility refers to rapid and unpredictable changes in the environment, such as market fluctuations, technological advancements, or political events.
Uncertainty describes the lack of clarity about the future, making it difficult to know what to expect or how to plan.
Complexity refers to the interconnected nature of factors in the business environment, making it difficult to understand the root causes of problems.
Ambiguity describes the lack of clarity and information, making it difficult to determine the best course of action.
Chances are, your business is operating in a VUCA environment; however, far too many people stumble across this concept until it’s too late.
Furthermore, among those already familiar with this concept, many take it too far! They suggest they cannot create an effective business strategy because the market is too chaotic and uncertain. This is wrong!
Industries such as retail are always chaotic and uncertain; however, having no strategy is an approach that will lead to failure.
Winning strategies are flexible in that they guide the business toward success and leave enough slack in the decision-making process to adjust to new information, tools, or customer feedback.
In other words, they aren’t rigid prescriptions. They are flexible creations that mutate and evolve as real-world circumstances require.
Finally, we must create feedback loops. During one of my programs, I discuss the idea of focus and action. At the end of these sessions, we’ve set one or two goals and have 45-90 days to achieve them.
The first phase of the feedback loop kicks in at 30 days. Did you take the actions we discussed? What’s working and what isn’t? What’s standing in your way?
This process continues every 15 days until we hit our goal or 90 days. At each step, we look at where we started and where we are. We judge our successes or setbacks, and then we adjust.
This must be completed repeatedly until we achieve our goals.
I could continue with more ideas; however, these are five basic principles for rapid business momentum.
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