Way back in 1538 English Playwright John Heywood said “Rome was not built in a day”. You can be sure though, that every hour of every day there were bricks being laid – helping form the structure that would eventually become the centre of the Roman Empire.
This is how great strategy is built – block by block. Sure, building a strategy is not as grand an undertaking as building an empire but like an empire, it will crumble and fail miserably if the foundations aren’t strong (and this takes time).
Here are the five building blocks of great strategy to master:
1/Identify the Challenge: Create a powerful Challenge Statement
Create a powerful challenge statement that sets an extraordinary business challenge. What is it that you and your organisation seek to achieve by developing and successfully implementing this strategy?
Your challenge statement needs to be:
- Substantial– big enough to have significant implications for the organisation, business unit, department or brand.
- Motivating – make it emotive. Stakeholders must care about it & want it to come to life.
- Uncomfortable – stretch the organisation: the solution shouldn’t be obvious or too easy so people feel excited to work on the strategy and want to get stuck in.
2/ Market & Business Analysis: Get the right information
Ensure you collect the right information from the get go! It is important to have all the information on the table at the same time to distinguish between fact-based insights and commonly held beliefs and myths. There are many sources of info:
- Internal – including financial & non-financial quantitative data and qualitative info collected through interviews with employees.
- External – Other data sources include industry reports, future forecasts etc. Interview external stakeholders – suppliers, customers, shareholders etc. to gain a more qualitative assessment and a rich source of info.
3/ Issues & Opportunities Prioritisation: Focus on what is critical
Identify and focus on the critical – ensure you uncover the root cause of problems, don’t just address the symptoms. There are a number of tools that can be used for the preliminary analysis, including:
- SWOT/TOWS – Strengths, weakness, opporunities, threats
- PESTEL – political, economic, social, technological, environmental, legal
- Porter’s Five Competitive Forces: competitive rivalry, supplier power, buyer power, subsitution threat, new entry thereat.
- Value chain– analysis of each activity required to create a product or service to reach the end customer including costs & profit margins.
- Gap Analysis– compares the gap between the ideal state of how your business needs to operate and how you are operating today.
- VRIO– value, rarity, imitability, organisation – assess your organisation’s resources to ascertain their potential competitive advantage.
4/ Vision & Strategy Development & Alignment: Get alignment on all key issues
Once you have identified and prioritised the issues and opportunities the next stage is to align on the vision and strategic elements.
These are a few of the tools to assist you in doing this:
- The balanced scorecard framework, created and made famous by Dr. Robert Kaplan and Dr. David Norton, focuses on identifying the critical measures for areas of business performance beyond just short-term financial metrics. It’s also a valuable guide for what areas your strategy should cover, and to help you get alignment on all key issues.
KISS – keep, improve, stop, start. It’s the KISS of life or death on the activities, initiative behaviours, and attitudes needed to bring each strategic element to life. The exercise is done as as team not in isolation by a leader.
5/ Implementation Plan: Embed implementation and mobilisation into a high-level plan
Embed implementation and mobilisation into a high-level plan. It is essential to include the high-level action plan into strategy. You need to consider the organisation’s capability to implement any strategy from the outset.
While implementation incorporates elements unique to each organisation, its specific challenges, and strategy, the one consistent element is the need to mobilise the people responsible for making it happen.
Mobilisation is a critical enabler for successful strategy implementation.