A typical offsite strategy begins with an icebreaker. A brainstorming session then takes place and everyone's ideas about what the company should work on are recorded. Ideas come to you, you use colored stickers to “vote” for your favorites, and within hours a list is created. While this process is quick and allows everyone to have a say, it is not the most effective way to define strategic medium-term priorities, nor is it a process for arriving at a truly robust list for growth. Strategy and top priorities are not something to be made into a game.
The strategy process is under pressure. To streamline it, I'm using a basic template. We try to involve more people in the final decision-making stages so that everyone has a voice. Speed is just as important as engagement, but combining the two can unhelpfully simplify your strategy. Gone are insights, replaced by the same set of common priorities: profitable growth, operational efficiency, digital and AI, growth markets, customer centricity, and talent engagement. Sure, that's great, but it's the same list as everyone else.
Bring insight back into your growth strategy and be ready to build and execute a real growth strategy. To do this, answer six important questions in the following specific order:
1. How is the situation going? How will it change in the future?
Strategies have always been developed under uncertainty. Strategists cannot know everything they want to know about a situation, and they generally cannot know how others will react to the situation. But that doesn't mean we're completely in the dark. It's just about understanding what's happening in the surrounding half-light better than others and learning faster than others. How we do this is by starting the strategy process based on our beliefs.
Having robust and productive conversations that lead to strategic insights is only possible when you have a clear and simple assessment of the situation at hand, which is your starting point. There are four steps to building a situation assessment. First, what are the key trends currently shaping your industry and market? Second, and more importantly, what do you believe to be true based on these trends? Third, what do you currently know that you need to know or test to learn more? And what do your beliefs imply about the potential impact? Given these beliefs, what should or should you do?
Consider building your strategy by starting by answering this question over and over again. I am seeing X and I believe in Y for the next 3 years. So for us it's Z.. Power moves are intermediate steps, or beliefs. Avoid the temptation to jump from trend to suggestion and be clear about your beliefs beginning. Your beliefs guide your choices, and these strategic beliefs provide the foundation for making, testing, and adjusting strategic choices over time.
2. What is our right to win?
This is a competitive game where you will set and execute a strategy to win. Strategy clarifies how you will create value. You can move the needle up (customer willingness to pay), move it down (total cost), or leave it alone. Competitive advantage describes how these two needles are pulled apart, but more importantly, competitive advantage, or the right to win, articulates how the needles continue to be pulled apart over time.
There is a big difference between the right to play and the right to win. Before deciding where you want to play in the market, you need to be clear about how your company is differentiated. And there are only three ways to make victory possible.
- resource: you have something that others don't have
- ability: you can do what others can't do
- Barriers to entry: You can build a fence around your advantage.
Work with your team to consider each aspect of your business and ask important questions such as: “What do we have that others don't?” What can we do that others can't? How can we build a moat? To build a right to win, you need to ensure that these resources and capabilities are of value or can provide a return that exceeds their cost. Something that is rare or difficult to access and not widely owned by others. And unparalleled. Having one of a kind is the “holy grail” of strategy. This is because it means that even if other people watch you, study you, and spend more money than you have, you still won't be able to do what you can do in 3 to 6 years.
At this stage, be prepared to identify gaps in your winning rights. You can discuss how to fill in the gaps, but don't ignore the insights this series of questions can provide. Also, remember to work on your future right to victory, that is, your right to win in the world that you believe (based on your beliefs) will happen, not the world that used to be.
3. Where do you play?
Deciding where to compete in the market involves tough trade-offs. While many options may seem appealing, you may feel more comfortable having more on the table than less. But a company that tries to be all things to everyone is a company that is of no use to anyone. The potential playing field is frighteningly wide, but to win we need to draw some lines and clearly declare, “We're going to play.” here”
Making informed decisions requires addressing the following overlapping questions:
- who Who is our ideal customer? What is our ideal market?
- what do we provide them? What is our value proposition or the job we need to perform?
- how Do you approach them or go to market?
These sub-questions (what I call WhoWhatHow) should be addressed based on the winning rights obtained in the previous questions. We compete where we are or will soon be differentiated. Make sure these fit or reinforce each other. WhoWhatHow is at the heart of value creation, so spend your time here and consider new options.
4. What is success?
Now that we've reached this halfway point, it's time to ask where we should go in light of these insights. What does success look like?
Strategy requires a finish line. If you don't know where you want to be by the end of your strategy cycle, no matter what path or priorities you set, you may or may not get there.
But strategy also has another role. It helps you understand how to act and react as you run toward your goal, because unexpected things happen along the way. Therefore, you also need to determine the boundaries, non-negotiables, or parameters within which your team must stay as you run toward the goal line. There is a contradiction here. It's not the boundaries that you're trying to optimize. I'm trying to optimize the main objective. But boundaries are more important because they cannot be penetrated. For this series of questions, set a clear goal (finish line) and boundary (fence) and try to stay within it until you get there.
5. What’s going to stop us?
Once you've redefined your definition of success, you want to make the path to get there as clear as possible. You don't want to go off course. The best way to avoid such situations is to think thoroughly about what could lead to them happening. “What’s going to stop us or break us?”
People often ask me, “Why should we discuss top priorities before setting them?” Shouldn't we first set our top priorities and then ask what the implementation challenges are? ” We recommend that you first identify the biggest challenges facing your organization. This is because addressing them may be a top priority.
6. So what should you do?
The definition of success is what you accomplish. The first priority is how to achieve this. Therefore, defining your top priorities should be the last question you discuss. Answering this correctly requires insight from the previous question.
In this last step, beware of the trap of linear growth and avoid reorganizing or updating your list of current efforts and priorities every time. Improving the same thing little by little every strategy cycle is not a growth strategy. Rather than starting a new topic, as a team, we draw key insights from our most important beliefs, the gaps we need to fill in our right to win (and the strengths we need to leverage), the sharp insights from our new “where to play” options, the key paths we need to take to reach success, and the biggest challenges we need to address to get there.
While this feels like a long list, the questions above have identified just a few overlapping themes that are now our top medium-term priorities. Your final list should be less than six to make a big difference in value creation.
Slow down to speed up
So what should you do? With key insights into how things are evolving and how you can win, we guide you to a clear and compelling finish line and a set of priorities to get you there.
This will take days instead of hours, but it will lay the foundation for faster and better decision-making as your team executes. Executing a winning strategy in a changing market means you need to slow down, agree on insights and gaps, and speed up execution of priorities.
And strategies with clear growth insights and actionable priorities tend to win.
Adapted from Survive Reset Thrive: Leading breakthrough growth strategies to overcome uncertain times Written by Rebecca Homkes.
