Strategy Basics: Seven Essential Elements of Effective Business PlanningAug 19, 2018
The first in our series focused on strategy
A solid business strategy is essential if you are to get the most of your market. Over the coming weeks and months, we’ll be providing you with a series of blogs that aim to help you understand what this involves and how to improve on poor results.
To kick off the series, here are seven important foundations for effective business performance.
- You do need a strategy Believe it or not, we regularly come across organisations that don’t have a strategy. They just blithely keep going in a particular direction with no clue as to whether or not what they are doing is the right thing. This makes it difficult, if not impossible, to identify and resolve risks, measure success or make informed changes.
- You need to use your strategy once it’s written There is a statistic often used by business advisors, that around two thirds of strategies fail due to poor execution. It can be very tempting to write a long and complex document that sets out in intimate detail your plans for the future, which then gets left on a shelf gathering dust. You may have been able to tick off 'write strategy' from your To Do list but you do also need to implement what it contains.
- Appoint people with gravitas and capacity as your strategic leads You need to give responsibility for your strategy to people who have gravitas and respect internally. This shows that you are taking strategy seriously. You also need to give it to an individual who has capacity to deliver what’s needed, which is probably not that reliable person you give everything as they’re likely to be maxed out. This can be the difference between strategic success and failure – the ability to secure buy-in, the capacity to do what’s needed and the authority to commit the necessary resources is everything.
- Consider your operating context Identify the opportunities that are available to you, now and in the future, and factor these into your plans. For example, if we know the marine sector is going to grow by 20% and we’re working with a road engineering company that has transferable skills such as tunnelling expertise, we’d consider the options for them to diversify into this new sector.
- Think strategy, tactics, action An effective strategy involves thinking about your long-term vision and mission, identifying the medium and short-term steps needed to deliver it and then actually taking action. An effective way to do this is to break things down into a 90-day chunk of activity, which makes delivering long-term goals mentally and physically easier to achieve.
- Shorter-term strategies can be more useful than long-term ones It used to be that most companies had five-year strategies. However, with the intense disruption and rapid technological and social change taking place, many have moved to a three-year strategy instead. We believe this can be a sensible thing to do as it presents plenty of opportunity for delivery and monitoring and evaluation. Ideally this would take place annually at the very least.
- Strategies should be short, sharp and to the point If you can’t put your strategy on deck of three slides on a deck then it’s a bad strategy. You may want to do more to explain how to implement it, but the vision for what you’re going to do and how you’re going to do it should be punchy. It can also be beneficial to articulate this at the start of every customer presentation.
We can help you systematically review all aspects of your business strategy, including resource allocation, to ensure that you are taking the best possible approach to business. We don't leave it there; we then work with you to develop your tactical plans and the change programmes to implement these new strategies. If you think your business would benefit from a deliberate strategy review, why not drop us a line? No pressure, no hard sell, just a friendly chat to identify some potential solutions to your challenge.
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