Written by: Chuck Gulledge Advisors – Individual and Organizational Performance Improvement
Every company says that they have a strategy. Having a vision and mission statement is not a strategy. Goals are also not a strategy. Strategy defines the who, why, and what of your organization. A strategy is only really strategy if alters the behavior of the people in your organization. So, you think you have a strategy?
Evolution of Strategy
Have you ever thought about the historical perspective of strategy in business? Where did it get its origin and how has it evolved over the years. Business strategy got its roots from military strategies.. Military leaders often fight traditional battles in the “war” room by establishing defensible positions and then fortifying them. In the 1960’s and 1970’s strategic planning moved into the business realms. The methodologies employed at during this period were top down driven. The late Peter F. Drucker is one of the earliest and most influential thinkers on business management. A classic since its publication in 1954, The Practice of Management, Drucker was the first to look at management as a whole and being a manager as a separate responsibility. Since that time, we have seen the evolution of frameworks and methodologies developed by leading universities, corporations, and consultants.
These frameworks started with general management, forecast budgeting, competitive distinction theories, strengths and external factors (SWOT), and strategic management. In the mid 80’s, we saw the rise of globalization and a dramatic improvement of technologies. These changes also lead to an increased need for strategy and strategic planning in business. In the mid 2000’s it was evident that the top down command and control way of managing was not what successful companies were doing.
Today there are over three thousand books and e-books on management and leadership and over two thousand books and e-books on strategy and management. There also thousands of blogs and articles that provides new insights on strategy. There are a number of influential business leaders including Clayton Christensen, a professor at Harvard Business School and the author of best-seller The Innovator’s Dilemma. He also wrote an all-time favorite of ours, How Will You Measure Your Life? Other business leaders include, Michael Porter (Five Forces), Jim Collins (Great by Choice), Patrick Lencioni (Five Dysfunction of a Team), and Marshall Goldsmith (What Got You Here Won’t Get You There). There is not a lack of resources for leaders of community financial institutions. There are thousands of frameworks (all though most are the same with different twists) to choose from.
What is Strategy and the Strategic Process?
Strategy defines the what, why, and how of your business. What business are we in, why do we do what we do, and how do we compete in conditions of uncertainty. It places an emphasis on organization and culture as critical ingredients in the execution of strategy. Values, motivation, and behavior of the organization’s team members are critical determinants of performance—and so is success or failure in implementing strategy. Strategy establishes a foundation that will help you navigate through rapidly changing marketing conditions and increased competition. Strategy is about being different.
Strategic Planning is an organizational management activity that is used to set priorities and to align resources and activities with the strategy. It also establishes measures and key performance metrics. At a high level, your organization should identify; what are the specific outcomes that we aim to achieve, what actions do we need to take in order to get there, and how will we measure our progress? The plan identifies how you move from point A to point B.
Budgeting is process that quantifies the financial goals and objectives of the organization.
Forecasting involves the predicting the outcome of events.
Why you may not have a strategy.
1. Leaders confuse strategy with planning, and they formulate an action plan of high level ideas and measures.
2. The budget becomes the defacto strategy.
3. The strategy fails to emphasize organization health and culture as critical ingredients in the execution of strategy.
4. The strategy identified does not differentiate and does not focus on what you do better than anyone else.
5. Nobody knows about it or knows what it is.
Strategy& (formerly Booz & Company) conducted a survey of 2,800 executives from companies of various sizes, geographies, and industries. According to this survey, most executives don’t feel their company’s strategy will lead to success, two out of three respondents admit that their company’s capabilities don’t fully support their strategy, only one in five are fully confident they have a right to win, and the majority say their company has too many conflicting priorities. Source: http://www.strategyand.pwc.com/global/home
Chuck is the founder of Chuck Gulledge Advisors, providing highly experienced executive coaching and helping organizations gain strategic momentum. Working with CEO’s and Executives, he focuses on leadership, strategy, and organizational alignment. Chuck engages with people in customized ways to improve their overall performance and leadership skills. Chuck has a successful 25 year career in finance, business development, and executive coaching.
Read Chuck’s Previous Blogs (email email@example.com for a pdf):
- How Big is Big Enough
- You Call That A Strategy
- Dump Your Strategic Planning Process
- Five Reasons Why You May Not Have a Strategy
- Think Like Trader Joe’s
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