Unsplashed by brook-anderson
Strategy is hard to get right. It always was but in this very unstable world, especially hard. Both in my own business, and in the businesses that I have coached, I see the constant learning and adaptation that is necessary to unlock growth and change. Progress is uneven, talent comes and goes, markets change, the economy tanks. Strategy, therefore, should not be seen as an annual event—more as a process of learning. If we learn faster or better than our competitors, we will have an advantage.
Founders are not always receptive to calls for strategy. In the early stages in the life of a business, they can be reluctant to commit to goals for fear of missing them. But the truth is, not hitting goals isn’t failure; it’s a lesson learned. Sometimes failure is the cost of inaction. And setting the right goals actually makes all the difference – it greatly increases your chances of success.
In an unstable world, experimentation becomes an important way of testing new products, services and technologies. Sometimes founder leaders hide behind a lot of experiments because they don’t want to take a decision. But surely it is better to be informed by experiments than paralysed by not knowing what might go wrong?
We need to learn faster to cope with the fast changing circumstances that companies are faced with. The leadership team and culture of a company needs to be brave, exploratory and open-minded about strategy. Strategy involves focus and, therefore, choice. So, we need to lose our fear of falling short or making a strategic mistake and make an explicit commitment to a particular set of outcomes.
UCLA management professor Richard Rumelt has written eloquently about the perils of what he calls “bad strategy.” In short, the perils are listed here:
> Failure to face the problem (coming up with a wish list instead)
> Mistaking goals for strategy (setting higher targets with no obvious leverage point)
> Bad strategic objectives (a long list of actions instead)
> Fluff (superficial abstractions like being “customer-centric”)
These things are so common to be ubiquitous in my experience. But fortunately, it does not have to be so. When I work with a company on strategy it typically starts with the CEO and their leadership team. And we start by facing the problem. I am currently working with a Swedish CEO on a White Paper in which he sets out the story of the business and concludes with some well-considered questions such as:
Asking the right questions, with the vision and purpose of the business in mind, helps us to face the problem. The next stage is for the team to weigh in on these questions to see if they can improve on them. The CEO is not precious about them, like me, he wants to get them right. As Bridgewater’s Ray Dalio puts it, great questions are a much better indicator of future success than great answers.
Once we have the right questions to help us to face the decisive challenges, we will meet as a team to create a coherent approach to tackling them. The test of the strategy has to be, does it tackle these challenges effectively and does it keep the company on the path toward their vision/purpose?
Execution is often where strategies flop, but you can greatly reduce some of the problems of execution by involving the right people in the development of the strategy. The “right people” are those who will be critical and accountable for its successful execution. These people will not always be a part of the leadership team.
The meeting we are planning to develop the strategy will not be ‘smooth sailing’ and I do not want it to be. Conflict is helpful in decision-making because it can uncover the hidden assumptions and data that lead people to make less well-informed decisions. Lack of healthy conflict ensures lack of commitment.
Opinions need to be aired properly in passionate and open debate to get buy-in and commitment to clear and specific resolutions and calls to action. That gives us every chance that the strategy we will have built will not only be a serious response to the decisive challenges, but will also be implemented, tracked, learned from and adjusted to respond to changes in the context.
Getting the strategy right and engaging the whole organisation in its delivery gives everyone a powerful sense of meaning and mission.
Simon Court
For more on this topic and many others, see my new book:
Founder’s Legacy – Fifty Game-Changing Leadership Lessons for Building a Great Business, published by An Inc. Original (2024).