When one hears the words “strategy”, some get nervous, some get headaches and some simply refuse to go any further with more discussions on what the word means for their business.
Then there are some of those entrepreneurs that equate strategy with achieving success or simply winning or even their vision. While this might be right to some extent, it is mostly wrong. Yes, winning might mean that your strategy was the best, but bribing someone to ensure a win does not mean that you have the best strategy, it simply means that you are willing to cheat to win. Is that the best strategy?
A Strategy is not what you think it is:
One of the best authorities in the field of strategy, Richard Rumelt, puts it very simply in his book – Good Strategy, Bad Strategy.
“Discovering the critical factors in a situation and designing a way of co-ordinating and focusing actions to deal with those factors”.Richard Rumelt
Simply put, I believe this means that you need to identify the critical success factors in your business and manage your resources, assets and people in an efficient manner to ensure that you achieve your vision or desired results.
It certainly does not mean that you must cheat to ensure the win, but most importantly it does not mean that your strategy can be equated to winning or goals.
Your goal is the picture at the end of the road, it can never be your strategy. Every business needs to have goals, you need to know where you are working towards, why are you going through all of this effort.
Your business strategy is contained in the steps, the actions, the manoeuvres, the plays and the decisions you make to reach your goals or overcoming problems. Or even better, it’s the “steps in-between”.
A good strategy is not always contained in a 100-page document
So many CEO’s, business owners, new and seasoned entrepreneurs believe that a good strategy is defined, detailed and written down in a 100-page document, or however many pages you felt like, that is circulated throughout the business.
No. It’s. Not.
Rumelt continues in his book and states that the most basic idea of strategy is the application of strength against weakness or opportunity.
Rumelt states that the most basic idea of strategy is the application of strength against a weakness or an opportunity.
This means that as the business owner, the entrepreneur, ultimately the person responsible for the strategy of the business, you need to identify and know where the strengths in your business are and then devise a way of countering the weaknesses in the business and devising a way of exploiting the possible opportunities in the market place. Your strategy must not be an airy-fairy write up of jargon.
A good strategy does not state that “we will follow a low-cost strategy during 2017 to gain market share where after we will follow a growth strategy of purchasing a competitor to grow our customer base”.
It must be realistic steps that can be altered in a dynamic market place.
There is no template for strategy
Say what? There is no template for strategy?! Correct.
A true business strategy design does not draw on a template design for “your industry” or a fixed checklist for your “type of business”. The basics of a template system assume that every subject thereof faces or experiences the exact same issues than the next subject.
We all know that every business is unique, every business is different than the next one. Two businesses within the same industry, in the same city, serving similar customers cannot use the same business strategy to achieve its goals.
The biggest difference between them is the people that work within the business. One might have employees who have an entrepreneurial mindset whereas the other might have employees with a “Friday pay packet” mindset and do not care for the wellbeing of the business.
Never use a template design to determine your business’ strategy and figure out exactly what challenges your business is facing to design a proper strategy.