Good strategy is a process
Are you used to thinking that company strategy is created in a 3-day, offsite retreat?
Good strategy is a process. While those 3-day retreats may be a start, they are not nearly long enough to do a thorough job. Just like any other process developed by a team (the executive team in this instance), process works takes time, has many checks, balances, realignments, and needs to be understood in the same way by all team members so that it can be communicated consistently.
What are the important pieces to bring into this process?
- Data: To align the company for success, data needs to be used that expresses what the customers value – both those you have and those you do not but that you hope to have in the future. With today’s advanced analytics based on big data and statistics, your data should be delivered with a clear view of your current and desired market segments based on customer values. If you don’t have the capacity to work with big data, use great data obtained by talking with your customers and those you want to be your customers. You need to integrate customer values into the strategy you create. This integration will dictate the corporate processes that are created to deliver customer value.
- Gap Analysis: Your gap analysis can be formal or informal. Don’t wait until sometime in the future when you believe you are big enough, or you have exactly the right person, to create a formal gap analysis. In Nike terminology – Just Do It. You know where the pain resides in your business. If you are unable to make use of more formally derived data, then gather it yourself from the areas with a lot of expediting, or where spreadsheets are manually created that should be handled by systems, or where work arounds are implemented since systems don’t communicate effectively to each other, or where functional areas seem to be at war with each other (usually a policy or process problem), or from the customer who chooses not to buy, etc. Understanding the root causes of these items leads to cross-functional platforms that will be embedded in your strategy.
- Team member insight: Engagement reduces and eliminates emailing/texting/other distractions that busy executives can be occupied with during strategy meetings if they do not have a stake in the strategic process. To create a robust strategy that works in your company, you’ll need everyone’s insight and point of view, as well as the intense discussions and resulting decisions that come from having multiple viewpoints. To be among the best performing companies, you’ll want executive leadership who want to be involved, are curious, and seek to improve. They become the role models the rest of the company imitates (gallup.com, Business Journal: Seven Things Great Employers Do (That Others Don’t))
Getting through all of this requires constant attention. It can’t be accomplished in a 3-day offsite once a year. A strategic plan needs the same attention and commitment that any continuous improvement, or radical improvement, plan requires.
Once released for execution, the tactical processes and supply chain changes created to support the strategy need to be constantly monitored against the strategic performance indicators chosen by the team. You’ll monitor how the changes being made are affecting the company’s financial health, market penetration, and desired growth. Monitoring leads to additional executive discussion and decision making for careful, nuanced realignment of the strategic plan. All this must happen if you and your company are to deliver the desired results.
Strategy is a process. It can’t be occasionally paid attention to. It requires constant, purposeful care, oversight, and effort.
Key words and topics: strategy, process, role model, gap analysis, big data, teamwork, alignment, metrics, continuous improvement, plan, gap analysis, customer value
About the author: Cynthia Kalina-Kaminsky with Process & Strategy consults with and provides training for organizations eager to increase their competitive value by helping enable growth, align performance, make and move product (even when the product is a serving of electrons). She is teaching SCOR (Supply Chain Operations Reference model) in Baton Rouge this October for APICS New Orleans. SCOR is the framework over 5000 companies use to increase their performance.