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Common strategy misconceptions

STRATEGY is a widely used term in Zimbabwe’s business and non-business circles.

Brett Chulu

Is strategy really understood?
At one time, we were discussing with a business leader on business issues and the subject of strategy crept into the conversation. I pointed out that a business strategy should not cover more than two pages. He was shocked. I had anticipated that reaction.

Essence of strategy: Case study
At the risk of over-simplifying, strategy is cleverly employing unique advantages enjoyed by an organisation to attain a better future state. This applies to business, church, schools, government, hospitals, families alike — in essence every organisation that desires a better future state.

However, in a business setting the desired future state is reaching target profitability. It doesn’t matter the strategy framework you use, the goal is to help you to do three things: uncover your organisation’s unique advantages, clarify your desired future state and make a candid assessment of your current state.

That’s pretty much all what a strategy framework can do. It helps you organise your thoughts coherently. It does not replace disciplined and rigorous thinking.

A strategy framework may give broad guidelines to help you combine your unique advantages. That’s different from telling you exactly how to combine your organisation’s unique advantages. Identifying nuances and finding ways of combining these in ways not done by anyone else is what strategy is all about. McKinsey’s 7s, the Balanced Scorecard, for example, will not do that for you.

I happen to be a business person too. Yes, a business strategy can even fit on one page.

Recently, we conducted a strategic planning session for our local church. Our strategy was captured on a single page. Here is what we had on this single page.

First, we had to be clear on our mission. Fortunately, for us, the worldwide church, of which we are a member, has a mission that never changes. Thus we simply adopted the mission. We must be clear; we did not copy the world church mission statement.

We captured the essence of the world church and applied it to our unique circumstances.
Second, we crafted a vision. We painted how success of our mission would look like in 2020. The statement that captures the vision was very, very short.

Third, we defined our territory. On an obvious level, we defined the physical boundaries of the territory in which to carry out our mission. This is a very critical element of strategy that many business leaders overlook. You can’t carry out your mission in every territory.

Business leaders must carefully choose where they want to compete. That entails deliberately foregoing certain opportunities and not competing in certain market spaces. On a less obvious level, we defined our territory according to the most pressing needs faced by people in our territory. This included those pressing needs weighing on our current members and prospective members.

These pressing needs were not just current; we also projected future pressing needs. For instance, our baseline survey uncovered something we had not really noticed — currently we have very few teenagers in our congregation.

This anomaly is due to the current demographic structure of our congregation as uncovered by the survey. We could see clearly that in 2020 teenagers will form a significant portion of our congregation.

Our plans had to start preparing for the opportunities and challenges brought by this significant anticipated future demographic change. Few businesses go this far. The lenses they use, at best, normally do not see beyond three years. Our lens penetrated seven years into the future.

Fourth, we defined clearly what we needed to do to be relevant in our territory. This was backed by formal research. We carefully phrased objectives that helped us capture and track relevance. If we failed to be relevant, our mission and vision would be just a pipedream, an airy-fairy affair as it were.

We then looked at the capabilities, processes and practices that were needed to directly deliver on those things that will make us relevant in our chosen mission territory.

Fifth, we defined our desired culture. Our desired culture was based on those values and capabilities that were critical to the stated mission and building a mindset that will keep the congregation focused on always addressing the pressing needs of people in our territory.

We did not, like many organisations, have a list of common values. We wanted those that were directly relevant to our mission and territory needs.

The process of coming up with these five elements of strategy to fit on one page was not a simple one. It required a deep understanding of the mission, a thorough analysis of current and future opportunities and challenges.

The process was informed by formal research.
Just in case, someone thinks that our strategy document was one page. No, it wasn’t.

It was 21 pages. We expanded our one page into measures, targets, specific programmes and budgets. We even scheduled our initiatives and allocated departments to execute initiatives

The fact still remains — the output captured in our one page is what strategy is. The nitty-gritty that follows is only as relevant as the quality of the thinking reflected by the output represented by the five points we have just outlined.

To wind our discussion we will look at two common misconceptions about business strategy.

Benchmarking not strategy
Roger Martin and AG Lafley could not have put it better. Sameness is not strategy, they contend.

You can’t copy what your competitors are doing and think you have strategy. By copying competitors you are simply closing the competitive gap. You are not winning. You are catching up.

Similarly, many think that if you adopt industry standards of the best practice of an industry you have strategy. Strategy is about having the edge over your competitors. Best practice can at times give competitive edge if you adopt practice from outside your industry. But if everybody in your industry adopts best practice, sameness sets in. Sameness is not strategy.

Here is a simple test. Take the mission, vision and values statements of your competitors. If you took these and hung in business, would it make any difference?

Just being different not strategy
The other extreme is that of an organisation that wants to be different for the sake of being different. Just being different for its own sake may rescue from sameness, but may catapult you to the realm of weirdness. Weirdness is not strategy. Uniqueness that is not built on a solid understanding of how to be relevant to your customers is plain weirdness. It’s not strategy.

It’s not the size of the strategy document that matters. It’s the quality.

Reflect on it
Strategic planning is not strategy. Going through the motions of planning strategy doesn’t guarantee strategy.

Chulu is a Strategic HR consultant who is pioneering innovative strategic HR practices in listed and unlisted companies in Zimbabwe – brettchulu@consultant.com

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