What’s your competitive advantage? Who are your key customers and stakeholders? How will you respond to disruption in the marketplace? Do you have the capabilities in place to succeed, and are your people aligned? Are you planning for the future—the right way?
If these questions make you sweat, you’re not alone. Setting a strategy that will help your organization or business unit succeed while responding to new competitors and changes to your industry is daunting. Assessing potential threats while creating new ways to grow is a difficult balance. Choose the wrong strategy, and you can stumble—or worse, go out of business. But find the right strategy and you can stand out to your customers and last for years to come.
But where do you start? And what do you need to think about? How do you decide where and how to compete, gain buy-in from your stakeholders and employees, and ensure your strategy is executed properly?
Whether you’re retooling your organization’s existing strategy, creating one from scratch as a startup, or outlining a plan for your specific business unit, this guide will help you think about your business in the right way to create a strategy specific to your needs. You’ll discover questions to ask and advice to follow to define a well-thought-out strategy, test it before implementation, and communicate it effectively for others to execute.
There’s no one, universal definition of strategy, but for the purposes of this book, you can think of strategy in the way that Stephen Bungay, Director of the Ashridge Strategic Management Centre, states in chapter 2: “Strategy is about what we are going to do now in order to shape the future to our advantage.”
Setting a strategy gives you an active role in planning for your company’s future. Without it, too many of your actions will be focused on the short term—reacting to every potential threat, meeting goals that may not have long-term impact, and focusing too much on the day-today operations and problem solving. What’s more, without an eye on the big picture, you may miss the larger shifts in your industry—shifts that require early planning in order to respond and thrive.
Having a clearly thought-out and communicated strategy also allows decision making across your organization to align, so everyone is moving in the same direction. Leaders and employees alike can then prioritize the correct projects and initiatives, focus on the right metrics, and invest in the most crucial areas. And they can make smart changes in response to new competitors or stakeholder interests.
And it isn’t just organizations that need a strategy. Business units also need to have such principles and fundamentals in place. While your company may decide that setting up a new office in Tokyo to expand its international presence is part of its global strategy, your business unit may then need to assess if its products and offerings need to change amid new competitors in the Japanese market. Either way, understanding the steps to setting a strategy, communicating it to your employees, and executing it will be critical for leaders at any level.
From Michael Porter’s five forces to agile approaches, how we’ve thought about strategy has transformed and shifted over time. But this book will not focus on any one specific school of thought. Rather, it will explore the practice of setting your strategy, so you can work with your leadership team to formulate the approach that works best for your unique capabilities, circumstances, and industry.
This guide will help you set a strategy for your organization or business unit by explaining the basics of what strategy is, helping you to lay the foundation for strategic discussions, walking you through what to think about when formulating your strategy, testing it before implementation, communicating it to your employees, and finally executing and learning from it.
While the steps outlined in this book are not rigid in their order, it’s important not to skip over any of them. Without laying the right foundation, your discussions are unlikely to prove fruitful. Without testing, you’re likely to stumble in unforeseen ways. And without effective communication, it’s highly unlikely you’ll see your strategy executed well, whether you’re leading the entire organization or a business unit.
Above all, it’s important to remember that a strategy is never static. Your plans will require frequent assessment, adjustment, and refining. According to Martin, “competitors don’t wait for your annual strategy cycle to attack, customers don’t wait for your annual strategy cycle to shift their preferences, and new technology doesn’t wait for your annual strategy cycle to leapfrog yours.”1 Lead your company into the future by thinking about your strategy regularly—starting now.
1. Roger L. Martin, “Three Quick Ways to Improve Your Strategy-Making,” hbr.org, May 22, 2014 (product #H00TEP).