Strategy is about creating a plan to achieve a goal in uncertain conditions. Strategic management is the direction of resources to achieve these goals. The strategic process is a guide for the implementation of strategic management, a template that helps you achieve these goals using industry standard tools and techniques in a clear and simple step by step process.
Strategy is a complex and difficult process. There are no right or wrong strategies, only different paths to take. The strategic process is less of a method that achieves strategy quickly, but more of a starting point to guide you through the strategic journey.
For the purpose of relating a strategic journey to a storyboard, I find it useful to categorise the varying strategic processes into familiar terms, the six Ws.
The Six Ws of the Strategic Process
Six Ws? I thought there where only five Ws, the who, what, where, when and why. This is true, however, a lot of strategy is also about how, our sixth w. More to come.
Now the strategic process is not much of a process if it does not follow any sort of order. This is not a hard and fast order, but a guide to lead you on the strategic journey.
- Why do we need to do this?
- Who is involved?
- What is it we are doing?
- Where are we going to do it?
- How will it get done?
- When do we start and finish?
Start with Why!
As Simon Sinek says, start with why. Why is about defining vision and values, or if you already have them, reviewing them to ensure they are current, relevant and most importantly lived by. These are the building blocks of your strategy, and although you don’t need to follow the Ws in any specific order, this one should be considered first. You need a good foundation to build a good strategy hence why is importantly first.
Who’s who in the zoo?
This W is about leadership, stakeholders and strategic change. All good strategies need strong leaders to guide the organisation throughout the journey. However a leader cannot be a leader without its followers or stakeholders. These are the “doers” of the strategy, the all important people making the changes. This is where strategic change ties in, there will always be resistance to change, however in order to achieve the strategy, resistance will need to be overcome.
you cannot manage change, you can only manage the behaviour that occurs through change
The what W focuses on Strategic Thinking and Business Definition. It seems silly to suggest that we don’t think strategically, with purpose and direction. Strategic thinking is about taking a high level view, the 50,000 feet level, looking not just at the organisation but thinking broadly about the industry landscape, social and technological change. Of course once you have surveyed these areas you can start to define your business and where you want to play, this ties in to the next W, where.
Where do I belong, or where would I go?
These two questions relate to Industry analysis and strategic transformation. Industry analysis involves surveying the competitive landscape, reviewing your competitor offerings, the company capability and customer needs. Where your capabilities meet the customer needs but your competitors can’t compete defines your strategic sweet spot, this is where you want to be.
Sometimes you’re not in your strategic sweet spot, and you may need to transform through strategic transformation. Transforming involves a shift in the way the business operates to achieve its desired strategy, this may occur via many different ways, but ties closely with strategic change.
Change is external, transition is internal.
How do we achieve our strategy?
How do we get it done…of course having a strategy is great, but we also need to achieve it. Porters generic competitive strategies provides guidelines on how to achieve your sustainable competitive advantage, based upon your competitive scope (who are you targeting) and your competitive advantage (low cost or product differentiation).
The business model chosen by the organisation will provide a basis for building a sustainable competitive advantage through defining critical success factors, having alignment and fit of the business activities, and importantly offering activities that create value.
Further, for the organisation to achieve the strategy, it requires core competencies, the collective learning in the organisation, the coordination of diverse production skills and the integration of multiple streams of technologies.
When do I start…and finish?
The sixth W adds the dimension of time to the strategic journey. Strategic intent demonstrates a desired leadership position and how the organisation will achieve its targets.
Strategic intent is more than simply unfettered ambition. The concept also encompasses an active management process that includes focusing the organisation’s attention on the essence of winning, motivating people by communicating the value of the target, leaving room for individual and team contributions, sustaining enthusiasm by providing new operational definitions as circumstances change, and using intent consistently to guide resource allocations.
Gary Hamel & C.K. Prahalad 2005
The Balanced Scorecard is another useful tool to measure the strategic process. Developed by Kaplan & Norton, the balanced scorecard provides insight into our strategy implementation.
- What you measure is what you get.
- Customer Perspective – How do customers see us?
- Internal Perspective – What must we excel at?
- Innovation and Learning Perspective – Can we continue to improve and create value?
- Financial Perspective – How do we look to our shareholders?
So there it is, a brief introduction to the strategic process using the six Ws. In my next post on strategy I will discuss the why of strategy in greater detail, in the meantime download the Strategic Process Six Ws of Strategy infographic below.
The Strategic Process Infographic