How do I create an effective strategy for my business?
This is a very important question that I feel too many businesses fail to recognize how critical it is. In our Two Day Rockefeller Habits Workshop we point to four decisions that are absolutes for companies to get right: People, Strategy, Execution and Cash. They are all equally important however Strategy alone can make you an industry leader with rocket like growth while having even mediocre people and execution. We’ve all seen businesses that have achieved great success in a relatively short period of time due to their having the exact right widget at the right time. How well they can sustain their growth is dependent upon getting the right people and execution in place. Of course no business can sustain growth without the proper cash flow.
At the Fall Fortune Growth Summit in Orlando, Verne Harnish focused on strategy and provided a specific example, which I will share with you if you send me an email, on how to establish an effective strategy for your business.
Here’s a checklist that you can use at your company to follow the suggested steps:
1. Choose the words you want to own in your marketplace.
2. Offer a unique brand promise.
3. Make it hurt to break your promise.
4. Create a one-PHRASE strategy.
5. Support your one-PHRASE strategy with differentiating actions.
6. Establish your “X Factor.”
You may ask how do I do this. I don’t know what an X-Factor is. I don’t know what a brand promise is or how to create one. Isn’t that the point? Do you want an answer on how to create an effective strategy or not? If you’re not willing to do the work for this then you lack commitment.
One of the Growth Summit speakers, David Sokol who is referred to as Warren Buffet’s Mr. Fix-it, noted in his book, Pleased But Not Satisfied, that his dad taught him the importance of helping when needed, but not doing the job for him. He wanted to build a go-cart when he was ten years old. His father encouraged him to save the money, create a list of what he needed, and once he accumulated all the material and announced that he was ready, his dad responded, “Go ahead and build it, I’m not going to do it for you!” Only after he built it and his maiden voyage in the family driveway ended up as a disaster, did he appear and ask him what he thought went wrong. He helped him to identify the problems and remedy them. It was his way of teaching. Try first, show me you care enough to try, then he stepped in to help.
In our quick fix, impulsive society, it’s easy to lose sight that success is a journey not an event. Switch author Chip Heath pointed out that breakthroughs only happen after you’ve smashed into a wall. You need to prepare yourself and others for failure.
You most likely won’t get your strategy right the first time. It takes lots of strategic thinking, time, research, discussion and trial and error. Which portion of this have you failed to invest in?
Most companies place priority on strategy development over execution. The key to the steps outlined in the Seven Strata of Strategy is that several are ultimately connected to execution. Your Brand Promise, when correctly identified, has three measurable metrics that you consistently quantify to ensure you are meeting it. Your One Phrase Strategy requires differentiating actions that are identifiable processes in your execution. Your X-Factor will definitely need to be executed or it won’t be an X-Factor. Any piece that is measureable of your strategy requires execution to ensure it is accomplishing its stated result. A Strategy at this level has to be executed or it fails to achieve the suggested steps.
Every business has the opportunity to execute an effective strategy. Do you have the commitment to develop your strategy? Are you prepared to invest the time, energy, trial and error, research, investment in external resources, tools, and counsel required to develop an effective strategy? Are you prepared to measure your business results versus the strategy goals you’ve set? Have you the commitment to execute your strategy once you’ve identified it?
The question then becomes not can you create a strategy but whether or not you are committed to the level that this challenge requires? It’s a back breaking, mind exhausting effort. The rewards are well worth it!
Let us know if we can be of help to you in your discovery process.