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Why Having a Business Strategy Isn’t Too ‘Fancy-pants’ for Your Business

Posted by Dan Thurston on Jul 17, 2018 1:11:13 PM

This is part one of a six-part series explaining how agile strategy-making can get you to where you want to go, faster.

Maybe your business doesn’t have a strategic plan. At least, not in a document that clearly describes the problems your company is currently working to solve, the solutions your people are striving right now to implement, and the timeframes, resources and tools that are required to make it all happen.

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Document or not, you do have a strategy.

I don’t mean that not-having-a-strategy is a strategy. (Though in a meta sort of a way it absolutely is.) Rather, no matter if this is down on paper, there are:

  • Milestones you and your team are aiming to accomplish;
  • Reasons you settled on those milestones;
  • Transactions that need to take place for milestones to be reached; and
  • Things you’re doing to facilitate those transactions.

These are all elements of strategy.

I still work with business owners who think, ‘strategic planning is for overcomplicated corporate-types’. (If that’s not you, feel free to skip straight to my second blog post in this series).

Would you say your goals and milestones are helping you continually tweak your operations in ways that increase your competitive advantage? Is it giving every one of your people clarity on exactly what they should focus on right now – and better still, what other teams or individuals are focused on and how to support each other?

There is a simple way to check this out. Just ask a few people in your business two simple questions:

  1. What are you working on right now?
  2. What relationship does that activity have with increasing our competitive advantage?

If you’re satisfied with every answer, it may be that you’re the unicorn company that doesn’t need its strategy to be documented. Well done you!

 

Don’t throw out the blunt axe: make it sharper

A common reason for resistance to strategic planning is the time and effort required to create an effective plan. Given how quickly markets, techniques and technologies change in the modern world, this resistance is entirely rational. Before the ink has baked into the laser paper it’s printed on, a strategic plan may be obsolete.

But that takes nothing away from the fact that effective strategic planning has proven to offer tangible benefits to any business:

  • Strengthened competitive advantage
  • Heightened team performance
  • Improved profitability (revenue up; costs down)
  • Increased brand value.

So, rather than suffering the time and effort downsides of traditional strategic planning – which is exhaustive, highly detailed, and designed with a long-term view – smart companies are now engaging in faster, leaner ways of strategy-making. The techniques I now use in organisations of varying sizes and industries, and in both New Zealand and China, draw heavily from the disciplines of design-thinking and Agile software development.

These disciplines arose in direct response to the risks of getting things wrong in an unforgiving marketplace, and prioritise flexibility and speed over comprehensiveness. And I’m certainly not the only one who’s seen how effective agile strategy-making can be, read Harvard Business Review’s take on it here.

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The Chinese have a saying about the time spent sharpening the axe being critical to a lumberjack’s ability to fell a forest quickly. Likewise, the time you spend optimising your strategy-making skills will be repaid many times over in the gains you’ll see in performance, productivity and profit.

Click here to read part two of this series: “How to make sure your strategic plan is valuable for your business”

This blog is written by Dan Thurston, a Business Coach at The Icehouse. Dan Thurston provides coaching and consultancy through The Icehouse in the areas of leadership development, organizational culture, strategic planning, product development and management, and more. Get in touch with him today.

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Topics: Business Coaching, Business Strategy & Planning