Blog #4 Taking Stategy From Development to Implementation

Based on “Can You Say What Your Strategy Is?”, by David J.Collins and Michael G. Rukstad, the most successful business strategies are simple, clear and succinct. The authors found that most executives cannot summarize their company strategy and are unsure if the desired behavior is aligned within the business. A good strategy has three critical components: the objective, the scope, and the advantage.

Companies tend to confuse the objective with their values and mission. The mission statement explains the reason for being a business in the first place, and values spell out their ethical and behavioral ideals. Often companies in the same area have the same mission. That is why there should be a clear differentiation between the objective and the mission. Objective is the specific outcome desired from the strategy and the time-frame for achievement. Continuing with scope, which is the landscape or segment where the company will compete and lastly but more importantly, advantage, what your business will do differently or better.

McKinsey, on the other hand, with the article entitled “Have Your Tested Your Strategy Lately?”, makes a valid point that executives often treat strategy as a procedural exercise or a set of frameworks, rather than a way of thinking through problems. In the article McKinsey advises businesses to stress their business strategy with 10 tests, instead of finding a new one. More specifically, McKinsey wants answers to 10 questions, which are: if the strategy will beat the market if it taps a true source of advantage, if it is granular about where to compete, is it ahead of trends, does it rest on privileged insights, does it embrace uncertainty, does it balance commitment and flexibility, is it contaminated by bias, is there conviction to act upon it and finally, is it translated into an action plan.

With McKinsey’s great insight into this issue, I think one thing that seems to be missing if you are engaging your workforce in this strategy. In a room of MBAs, CEOs, and other executives, all the data, trends, expert opinions, and debates make sense, but turning around and then telling people that they need to change, without involving them in the strategy can make strategies get stuck. There seems to be a false separation between strategy and implementation; as it takes consistent, year-over-year leadership, communication, and trust-building to move an organization.

In today’s fast-changing world for companies to compete in the marketplace, a combination of analytics along with imagination is needed in their strategic planning process. The approach described in a Harvard Business Review article, titled “Bringing Science to the Art of Strategy,” adapts the scientific method to the needs of business strategy. Although the procedure suggested in the article is evidently strong, I think some weaknesses have been overlooked. For instance, it is not mentioned what would happen in the case of disagreement between the members of the team, and it is worth noting that the process is lengthy and would cost a company a lot of time and resources.

Finally, with the last reading, “Good Strategy Execution Requires Balancing Four Tensions", a couple more things were put into perspective while putting together a company strategy. More specifically, a vision of an “end state” along with “mid-state” targets to provide direction and a common end goal for all. Also, there should be a fine balance between having everybody contribute to making decisions and top-down decisions, because in one case there can be multiple uncoordinated directions and in the other people might feel discouraged and controlled. Companies that can balance between opposing forces are far more likely to realize successful strategies that endure.