As we approach the end of 2016, our Managing Director, Richard Coates, reflects on insights we have gained through working with a range of clients across several market sectors and on various business and strategy challenges. We hope this short series of thought provoking blogs helps stimulate some ideas and plans as you look ahead to 2017.
Back in the day, strategy was typically a long-term, annual planning process undertaken by the board and cascaded. Sometimes this was handled effectively by some more engaged and enlightened businesses; others were less effective.
Today strategy has to be more fluid and dynamic, and the gap between strategy and execution, which has always been critical, is now even more important.
This means a successful strategy has to live and breathe – constantly being analysed, adapted and reviewed. Of course, there should be a formal, usually annual, review of a company’s business strategy, but it should not just be an annual activity that is polished up and then put away.
Those companies that don’t manage their strategy process in a more dynamic and fluid way risk being overtaken by competitors and substitutes in the rapidly evolving business landscape. As a result, they are in danger of being increasingly inefficient and ineffective, and potentially even irrelevant.
Creating an agile business strategy
Business strategies are essential for ensuring your whole organisation is working in the same direction towards the most attractive and profitable opportunities. While many want to have a vision and a multi-year strategy and roadmap, it is now generally accepted that a three-year strategy and associated business / operating plan is realistic for most organisations.
Being agile and responsive to market shifts, competitive movements and changing consumer trends, together with a well informed and engaged organisation, is increasingly essential for sustainable commercial success.
Regular reviews and ongoing communication of strategic aims, business priorities and key deliverables and achievements is necessary to ensure an effective strategy, business management and execution.
Drucker is often quoted as saying: “culture eats strategy for breakfast“. This is certainly true. Having a strategic plan is valuable, but worthless if it is not executed and implemented effectively. In our experience, execution is ineffective when strategy is disconnected from day-to-day decisions, actions and behaviours, as can sometimes be the case.
Flexing business strategy to respond to opportunities
To aid this, strategy should never be formulaic, prescriptive or rigid. It must, of course, respond and flex to changing business, customer, market and competitive movements. Unplanned opportunities arise throughout the life of any strategy or planning period, and you must be prepared to respond and adapt.
In today’s highly competitive and technologically changing landscape, with new digital entrants in many sectors and changing consumer behaviour it is critical that strategy and execution co-exist more effectively and are mutually supportive.
The success of a strategy depends on: everyone in the business understanding the strategy and what it means for them in their function and role; ensuring the strategy is a part of regular communications and is effectively and accurately cascaded across the business connecting key decisions with the strategy; and, most importantly, regularly revisiting and flexing the strategy as the market and business evolves.
In the end strategy is the options and choices you can make to compete more effectively. That is an issue played out daily, even if it may not appear so amongst other daily challenges and priorities that every business and senior management team faces.