Yes, it does matter. After years of working on strategic planning projects with executive teams, I continue to observe confusion about what strategy really is. Leaders often mix up defining the vision, mission, values, goals and objectives with strategy. They believe that because they have a strategic plan, they have a strategy.
In discussions and publications about strategy, giant in the field, Michael Porter, defines strategy as: “resting on unique activities — strategy is about being different. It means deliberately choosing a different set of activities to deliver a unique mix of value.” The classic example of strategy that Porter uses is how Southwest Airlines selected a unique set of activities in getting started that propelled their success – no boarding passes, engaging and funny employees who were paid more that average, using the same aircraft to reduce maintenance costs and accelerating the speed of on ground maintenance, etc. The bottom line, “How” will your company win? Which activities in combination will assist you in offering a unique value proposition to your customers? The operative word is “how.”
In the April 2008 issue of the Harvard Business Review, Professor David Hollis and Research Fellow Michael Rukstad outline in their article, “Can You Say What Your Strategy Is?” the fact that most executives “can’t state their strategy statement in 35 words or less.” If the leadership of a company can’t articulate the strategy, who can?
Key Associates recently conducted a survey of executive women in Tampa Bay and the top rated area these executives want to learn more about and understand is strategic thinking. How do you set a strategy for your company or team? What does strategy really mean?
There appears to be a lot of smart people out there that don’t understand what strategy is and find it difficult to define for themselves, their teams and the company. In his “Strategic Thinking Manifesto,” strategist Rich Howarth cites his study of 500 managers at 25 companies to identify the top 10 strategy challenges companies face. Among these are time (not enough for proactive thinking, just reacting), lack of priorities (everything is important), and lack of understanding about what strategy really is.
In the executive women’s forums and CEO forums we facilitate, we assist individuals and teams in thinking strategically. Here are a few suggestions. Strategy needs to be connected to a goal. The goal is the “what” you want to achieve; the strategy is the “how.” Make sure you select your top goal and write down what you think the strategy is. Ask all the key stakeholders involved in the development and execution of the goal to write down what they think the strategy is. Compare the statements. Have an open and lively dialogue about what the unified strategy should be. Then communicate it to everybody.