What is a strategy and why do I need one?

To most people the term “Strategy” either implies “something large business organizations use to plan the future” or “what military leaders do to win a battle”. The fact that strategy is often associated with a military connotation is not surprising, given that the term itself is derived from the Greek word stratigos, "the art of the general". In reality, however, everyone who is interested in increasing their productivity should have a strategic plan how to get there.


Let us take a look at a simplified example: The strategic goal is the successful celebration of your daughter’s 10th birthday. One of the objectives is to bake a tasty cake by the morning of the birthday in order to surprise her and to have a cake full of candles to blow out. Tasks to complete that objective include deciding on what cake to bake, studying the recipe, making a shopping list, looking through the pantry for what is on hand, and going to the grocery store to pick up the items missing.


While it may be human nature to rush out and go shopping immediately - after all it feels good to get things done - spending some time up-front to think through what cake to make, by when, and what is needed to complete this objective, will likely save you a second trip to the store and reduce excess goods spoiling in your fridge or pantry. Seen from a business perspective: Precious resources (time and money) are wasted.


Of course, this example is a very simplified view of strategy, but it illustrates a key point: Every situation can benefit from setting a strategy before starting any tasks, no matter how obvious they may seem. The truth of the matter is, however, it is often far too tempting to give into human nature and jump straight into the activities, only to find out much later that the quality of the results are far from expected.


Strategy is in essence the master plan that ties all activities to reach a singular goal together, thereby allowing for an efficient execution. The second purpose a strategy should serve is the allocation and effective alignment of resources.
Picture a group of marathon runners, lined up at the starting line – each one a world class athlete, capable and ready of running the distance in record time. A lot of energy and excitement is bottled up. The starting signal is fired … and everyone takes off in a different direction. All that energy, the potential dissipates without meaningful impact. Now imagine the same scenario with everyone running in the same direction: The energy of each individual is harnessed into the aggregate force of a stampede.


A good strategy enables the harnessing of the many individual efforts into such a stampede by giving them a context through alignment and a clearly communicated common goal. Without it, any task performed has the potential to be wasted effort. As such, it is the sum of all objectives over a timeline that allows an organization to successfully transition from a suboptimal current state into an improved future state.


Last but not least, a good strategy becomes a great strategy if it is derived from an overarching long term goal and aligns all activities under that umbrella. Any strategy starts with an end goal or “vision” in mind. A vision is the answer to the question, “what, who, where do we want to be in 3-5 years?” Visions should be “BHAGs” (Big Hairy Audacious Goals). If you already know how to do it or effortless tracking towards this goal, it is not much of a vision. Do not, however, confuse a vision, the future state of the organization, with its mission, a statement of the organization’s purpose.


The better a vision expresses the true intent of the organization’s desired future, the more it can become the guiding beacon, the answer to the question “why?” behind every project and objective. It acts as the aggregate measuring stick against which decisions are made, resources are deployed, and projects are created and/or potentially stopped.


Once the vision is clear, creating the strategic plan essentially follows these steps:

 

The milestones depend on the time horizon of the vision. A 3-5 year vision will have annual milestones, a one-year plan is likely to have monthly milestones, and so on.


Generating the right objectives is a crucial step in enabling hitting the milestones. For example, an objective is not complete unless it has all of the following components: What, how measured, baseline, end state, timeframe.


Assigning clear ownership and support as well as establishing a frequent review structure becomes essential to insuring timely progress towards the respective milestone and early intervention if the circumstance change, as they inevitably will.


Creating the strategic plan can best be achieved by means of a standardized process, such as Hoshin Kanri (aka Policy or Strategy Deployment).

 

PSPadvisor can help with every step of this process: