There are numerous opinions on what makes a strategy successful or fail including everything from leadership to communicating the direction to the team, to the execution of the strategy. An often-quoted fact is that 70% of strategic plans fail, whether it is more or less, strategic plans do not have to fail.
I have found that when one says the word strategy, everyone will nod and provide a definition, however strategy can have different meanings to different levels of management. Some use the term strategy and plan in the same context, yet I believe they are different. I look at strategy as the master compass that will help a company determine how to win in its market. Whereas the plan is a detailed proposal. In my experience, a strategy becomes part of the DNA of the business. It is the organization's strategic plan for building and maintaining a competitive position in the market. There is no one way to conduct a strategic plan as some industries are more volatile requiring a faster change in direction. So, I acknowledge that one size does not fit all.
Several years ago, my manager asked that I write up how I work with my teams as I guide them through the strategic planning process. Once I had outlined the process and began to complete each phase I shared this with my co-workers who were also working with teams within the organization. I always start each new strategy planning session with a quote from Albert Einstein “No problem can be solved from the same state of consciousness that created it.” I want to make sure that teams understand that they need to think “outside of the box” and out of their previous thought process, leaning into the future.
I typically follow eight steps or phases in my approach, which has been refined over the years. All aspects of the process are needed but there are a few areas that need careful consideration centered on setting the right strategic goals (aspirations) and executing the plan. (1) Internal and External Analysis of the business, (2) Conduct Deep Dives into Industry data and customer research, (3) Aspirations, (4) Where to Play, (5) How to Win, (6) Communication to Organization, (7) Execution and (8) Evaluation.
A discussion that I often have with clients today, is how often to develop a strategic plan. In my experience, a company that changes strategic direction every six months to a year leaves the employees uncertain regarding the direction. Employees who are uncertain of the future, typically will not put their best effort toward the plan as they all know it will soon change. I recently worked with a company who had changed their direction four times over the course of a year. It was not a surprise that employees were not sure of the company’s strategy and that the employee morale was at an all-time low.
I believe a business strategy should span between three to five years. The strategy should not change on a quarterly basis but the tactics on how to achieve the strategy can be updated as the strategy is implemented. Of course, if the plan needs adjustment, action should be taken to ensure changes are made.
I hope to share future insight into each of the eight steps and how to be successful with each sharing what I have discovered over the years. As I learned from my colleagues at the Association for Strategic Planning, we must continuously think, plan, and act to achieve winning results.
Is your strategic plan successful? I would love to hear your thoughts on what made your strategy successful or what caused it to fail.
Dr. Tina White Potter is the Managing Partner at Retail Consulting Services, working with retailers and manufacturers to develop successful strategic plans which generate sales and business growth.
Developing and Executing Strategies That Generate Sales and Business Growth
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