“We don’t have time for strategy. We need to make some money now.”
“Strategy is all about theory. What we need is action.”
These kinds of statements, while common, are misguided. Strategy is definitely about action, and it is certainly about making money. In fact, one of the key reasons most companies aren’t performing well is a lack of good strategy.
Strategy isn’t supposed to be about theories and three-ring binders gathering dust on office shelves. Strategy is about defining a game plan that directs each action taken by people at your company– all day, every day.
Imagine a football coach telling his team, “We don’t have the time or energy to create a game plan. Just go out there, try hard, and score some touchdowns.” Seems ridiculous. So why does the same thing not seem ridiculous for businesses?
Here are a few recent examples of how strategy work with my clients turned into instant money-making action:
- While working with a client on a comprehensive strategy to improve their service and support business, we realized that the company’s service contract renewal process had significant problems that were limiting renewals. While working on this comprehensive strategy, the company was able to immediately begin improving the renewal process.
- I recently spent a day with executives from a company that markets two similar product lines, which aren’t well differentiated from each other and tend to compete with each other. Although it will take longer than one day to create a workable product portfolio strategy for this company, this meeting generated three strong ideas that could be implemented right away to limit the customer confusion and margin erosion that currently plagued the company.
- During a phone call earlier this week with a CEO, he and I identified some near-term action steps, based on strategic work his company has done, that will enable him to pump some life into a sluggish quarter.
So how can strategy make you money… now?
Do the Right Things
As management guru and philosopher Peter Drucker taught us, effectiveness is mostly about ensuring you do the right things. When I see companies with weak strategy, I always see that they focus their efforts on things that aren’t really that important.
Your resources are finite, so let good strategy ensure that you allocate those resources to doing the right things. Follow this checklist to stay on track:
- Are you directing your efforts towards the most promising drivers or results?
- Are you focused on the right customers?
- Have your strategies not only helped you know what you should do, but what you shouldn’t do? (A “to-don’t list” is one of the most helpful things good strategy can help you create.)
Consider this: Do you and the people in your company have a strong strategic framework that ensures people spend their time doing the right things? If not, think about the time that is being wasted in your company… right now.
Cutting Through the Clutter
Companies without strong strategies tend to communicate with their customers through disjointed, confusing messages. The result is that customers are confused, and aren’t sure why they should buy from these companies.
When a company has a clear brand strategy that defines what they want customers to think about them, it is more likely that they will create communications that are clear, compelling and differentiated. Are you clear about what differentiates you in meaningful ways? Are you clear about what you want your customers to think about your company?
Consider this: Does your company have a very clear and well-developed strategy for what and how you communicate with customers? If not, how do you expect for customers to be at all interested in paying attention to your messages, let alone be motivated by them? How confused might your customers be… right now?
Strategy Creates Culture
I once heard someone say, “Strategy eats culture for lunch.” While culture is one of the most important things that can drive a company’s results, strong company cultures don’t just pop into existence spontaneously.
I have seen that the strongest company cultures are not just those that “feel good” to employees, but those where employees feel that they understand where the company is heading, and they feel like they play important, personal roles helping the company get there. When employees understand your company’s strategies, and feel they are part of efforts to realize those strategies, your culture will be stronger and your employees will be more productive.
Consider this: Do your employees know where your company is headed? Do they feel like they are contributors to your future, and do they care about your future? If not, what kinds of actions and behaviors might they be engaged in that are not productive and effective… right now?
You can’t be everywhere at all times to control everything that happens in your company. Let good strategy work create a game plan that directs everything that happens, including the things that can happen to generate results… right now.