Strategy is defined as a plan of action or policy designed to achieve a major or overall aim. Sounds simple, right? So, why is it that so few organizations do it well. Here are the most common mistakes I’ve observed. Avoid them and you may just find yourself in rarefied air as one of the few organizations with a differentiated and powerful strategic plan.
Mistake #1: “We are good at” does not equal a competitive advantage
I think I am a pretty good writer but that doesn’t mean I have a competitive advantage in writing. Stephen King, on the other hand, cold probably claim this ability as a competitive advantage. Being good at something is good but it takes a significant leap to get to true advantage.
Instead, ask your customers what it is that sets you apart from the rest of the market. Take that most common answer and double-down, invest and make it an even more distinct advantage. Your customers say there’s nothing special about your organization? Then pick the thing you are best at, invest and keep asking.
Mistake #2: Growth is always good
Growing too fast can put significant pressure on your cash flow. If expansion happens too quickly, you may also outgrow your customer service capabilities, facilities or your own time.
Instead, build the ability to scale into every choice. Buy the computer system that will allow you to handle 10x the customers you currently have today. Build a staffing model that can expand without handcuffing talent.
Mistake #3: That’s where the market is headed, we must go too
The world has gone to digital, instantaneous communication. So, that means your business need to meet that market, right? Wrong. The decision to follow the market or to depends entirely on your specific customer base and what they care about. If they crave in-person communication, for instance, why invest your resources to make digital communication a strength. While you may find a need to pursue market trends, do so in a way that matches and enhances your customer intent and resist copying the leaders. Blindly following the market can have you sniffing exhaust….
It’s a big, big world. While the masses move one way creating commodity situations, there will always be a segment moving the opposite direction and combing multiple macros trends to create unique products and offerings that the market didn’t even know it needed yet. That is where the innovation happens.
Mistake #4: Limiting yourself to incremental thinking
How many of your plans include things like, “increases sales by 10% this year.” Don’t get me wrong, that is a great goal but, notice how your mind (and the minds of your team) go straight to assuming they just need to do more of what they are already doing to get there. You may reach the 10% that way but you will have missing opportunities for thinking bigger and capturing market-shifting opportunities.
Instead, develop a vision of your perfect outcome. Examine companies in other industries you feel are leaps and bounds further along than the rest of the world. What is it that makes them special? If you could do the same, where would your organization be. Think big.
Mistake #5: Not linking metrics to outcomes
“Grow” is not a strategic outcome. Sure, growth may likely be a part of your plan but without very specific actions and metrics linked to that “Grow” statement, it leaves to the imagination the ‘how’. It leaves open to interpretation the type of growth you want and from where.
Instead, be specific. “Grow the X product market Y% by Z date through targeting the ABC market segment.” It will be clear from that goal whether you’ve been successful or not. If, amid implementing your plan, you learn something new that changes your strategic outcome then, change the statement.
Mistake #6: Trying to do too much
How many high priority initiatives does your organization have? 10? 15? 30? I like to think I am like most other people. I know that I find it quite difficult to focus on more than 2-3 top priority initiatives at a time. Any more than that and it’s just a to-do list. I don’t think I want my company’s strategy to read like a to-do list.
Instead, by placing a majority of your leadership communication and focus on the 2-3 critical strategic outcomes, there’s very little room for confusion or mishaps in resource allocation. Every employee can very easily point to their contribution to making the strategy real.
If you or your organization would like assistance in building your strategic plan, facilitating the leadership planning discussion, mining the metrics for the business or just want to see if you are on the right track, reach out to me at email@example.com.