We often visit companies to review their operations and diagnose why things are not going as well as the business owners had thought. Invariably everyone is busy with various tasks, and everyone is working hard – but often, there is a wide gap between business and busyness.
There are countless ways everybody can be full of busyness. From reviewing numbers, analyzing analyses, e-mailing, talking, tweeting, or engaging with someone about something through some channel.
But what will be the net result of all this busyness?
Will there be an increase in business? If every associate, every manager, and every contractor engages in whatever means to achieve a nebulous, ill-defined end, busyness will grow, but will the business?
The importance of strategy
Strategy solves this problem. A well-thought-through plan is often the difference between a successful business and a group full of busyness. The term is, admittedly, overused; corporate boondoggles, complex decks, and high-level initiatives with no life are often labeled “strategy.” But this misses the point: strategy should help focus the company on a winning course of action.
Its purpose is to align the efforts of all participants and ensure that the company delivers value for the customers and creates wealth for its investors.
Companies, large or small that do not have a working strategy will chase everything that can be done in a given moment. Busyness leads only to more busyness. The end result is internally competing initiatives, politicking, and wasted time and resources escalation.
Fortunately, creating a useful strategy does not need to be a complex exercise; there is nothing mysterious about it.
The essential elements of strategy
Building a successful strategy requires three essential elements.
- A goal. This can be a problem that needs to be overcome, a challenge that needs to be addressed or achieving a vision for the development of something entirely new. A good goal stretches the entire company and requires a coordinated effort by all. Establishing the “reason” behind the drive toward an end – and bringing others to agree with the importance of the goal is fundamental.
- The approach to reaching that goal. The critical step here is to decide how the company will achieve the goal. Often there are myriad approaches and many considerations, including market forces, competition, and business constraints that impact the decision. Defining and refining the approach can take time, but it can also be as simple as merely deciding: this is how we will do things.
- A plan of action. This plan will detail who will do what. It should have clear and executable steps, and it should include metrics to assess the performance and efficacy of the strategy. The plan enables execution, and measuring results allows the company to refine and improve the strategy.
How to implement strategy
In the simplest form, such a strategy is easy. If, for example, the goal were to cut down a tree, the goal would be pretty simple: cut it down. The next step (the approach) would be to determine which course bringing down the tree would be most appropriate, using a chain saw (big tree) or a weeding fork (sapling). Finally, a plan of action would engage the tree according to the approach and measure your results (tree down or not).
Such a simple plan is excellent for one tree. But if there were a thousand trees to bring down – or a business to run – the strategy would become more challenging. The goal would not be as clear, the approach would require more thought, and market assessment and the plan would be more detailed.
This is where strategy becomes challenging – good strategy requires choices between mutually exclusive goals.
A business cannot do everything; instead, managers must determine their competitive advantage and how they can use it to generate value for the company.
Likewise, the approach must fit the goal and deliver results in a complex and changing market. Developing such an approach requires managers to step out of their day-to-day activities and think creatively about the best way to accomplish the goal.
Finally, the action plan must be broken down into specific, tangible, and achievable actions. If this is not done well, the company will fall back into busyness and struggle with execution. Failure is often the result of not being specific enough or creating too broad action steps, such as “get customers” or “grow revenue”. Such vague statements are useless as guides for managers and associates as to what actions to take to deliver the desired, measurable results.
Developing a strategy is essential to maintaining focus on business goals. The process does not need to be long and difficult. But, it does involve thinking, planning in advance, and making hard choices.
This can be challenging, but if management doesn’t do it, the rest of the company won’t either.
And without a strategy, any company will invariably degrade into a bunch of people who are busy throughout their day hoping that something works.
Putting the time and effort into creating a clear strategy is a better way, and it is also the only way to convert mere busyness into a successful business.