Wednesday, April 22, 2015

Looking at Elements Cyclically

The article “Can You Say What Your Strategy Is?” by David Collis and Michael Rukstad, which I will refer as the “Collis article”, covers many clear and defining points that can help an organization recognize the difference between a strong, clear strategy from ambiguous or lengthy attempts.  However, I found the Collis article lacking the area of its spoken objective; to help firms develop good strategies.  To supplement the article, the elements mentioned in it need to be taken in context of their relation to each other and how they interact within the creation of a firm’s strategy.

First, I will provide a brief overview of some of the Collis article’s key points which are necessary for strategy development.  The article covers three topics which must be covered by a firm’s strategic statement: objective, scope, and advantage. 

A firm’s objective should cover a single, specific, and measurable goal which the firm aim’s to reach within a specific timeframe. From the Collis article, it seems that the objective fuels the initiative for the company’s mission statement; the mission statement explains the purpose of the firm’s existence where the objective explains what the firm plans for that purpose.

The scope describes a firm’s business landscape, how they define customers, and most importantly, how they define the fields they will not venture into and who is not a customer.

Lastly, a firm’s advantage explains where the firm differs from others in the industry. Externally, it shows customers why to choose the firm over others. Internally, it describes how activities should be aligned to deliver on the firm’s services or goods.

In regards to the actual development of a strategy, the article covers two points I wish to stress. One, that the strategic statement covers is concise yet covers the three elements described above. Second, that the creation of a strategic statement should involve employees from all levels of the hierarchy. These too points help ensure that the final product will be complete and understood by the entire firm.

Where the article falters is in regards to the development processes itself. The three elements described in the article are vital to the development of the strategy, not just to the statement itself. Furthermore, the elements need to be considered in relation to each other. The company’s advantage will influence the potential scope of their market, and once the scope is known the company can hypothesize different objectives.  In contrast, by taking a specific objective the scope may change.

I believe the best way to deal with the correlation of the strategic elements is to cyclically analyze each of the three elements. The firm might first describe its most general audience, then it’s most general advantages. From there it can identify important objectives which are feasible within those bounds.  Starting the cycle again, the firm should segment and prioritize advantages, analyze and segment the scope of the highest prioritized advantages, and finally assign possible objectives to each segment.  Then the cycle can be repeated until a tree of potential routes and strategies can be made with priorities showing which limbs to focus on.  This process can be shortened to a finite number of cycles to emphasize the most promising strategies. Concluding the process, employees of each level should review the options presented so that the varying opinions can remove strategies which might have high priorities by management but low priority by another department.

To summarize my analysis, the three elements described by the Collis article are as essential in the creation in a strategic statement as they are in the statement itself. While careful consideration and debate is necessary for developing such a statement, the key elements are useful tools to fully understand potential alternatives and options a firm could consider.

Daniel Johnson

Blog 5

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