The other day I met with a tech industry CEO and we talked about Corporate Strategy that he is planning for 2019 and how he wants to grow his company’s revenue by over 100%+ in the next year. We spent at least half of the time actually discussing what Strategy means and what his Strategic Plan should include and I decided to write this post based on that meeting and also because at times I see companies misusing the word “Strategy” so I thought I would clarify it here in hopes of helping companies get better at their own Strategy and planning.
On that last point, let me throw out a few examples to highlight what strategy is not. For instance, strategy is not what you want to do, it is also not the a mission statement and strategy is not the same as a vision statement – so when you hear one of these statements then then you will know that the word strategy is not used correctly – i.e. “our strategy is to be loved by our customers” / “our strategy is to be the best product in our industry” / “our strategy is to be a billion dollar company”. These are not strategies. Also Strategy is different from Tactics – so if you hear a “to do” list tactics or activities than that is not a Strategy either.
I believe I have a unique perspective on what Strategy really means and on Strategic Planning (as well as “executing strategy”) because I helped hundreds of CEOs/COOs/CROs while I was the CEO at Atiim Software. As you know, OKRs (Objectives & Key Results) are directly linked with the companies strategy and link it to execution so it is important to understand what Strategy means.
Here is how I would define it in simple terms. Strategy is an integrated and iterative “Game Plan” for how a company intends to win in its industry and attain its objectives. It is a coordinated and integrated plan that will help a company create value for its customers while differentiating and positioning the company for a sustainable competitive advantage in its industry. Strategy must be created to deliver superior value to customers relative to the company’s competition (e.g. see “What is Strategy?” on p.3 in “Playing to Win” by A.G. Lafley and Roger Martin).
Also, your Strategic Plan helps the organization achieve its top quarterly and annual goals (i.e. OKRs) while giving a company the necessary momentum in the right direction towards its long-term 10-year vision. Finally, Strategy includes the initiatives that align the organization’s 3 key resources – people, time and money – to achieve its goals successfully.
p.s. Want a few book recommendations on Strategy? Here are the ones I read and liked (but some are very deep and may be a bit overkill for most who want an intro):
- Competitive Strategy – Michael Porter
- Playing to Win: How Strategy Really Works- A.G. Lafley & Roget Martin (this book is easy to read, written in an approachable way)
- Competitive Advantage: Creating and Sustaining Superior Performance – Michael Porter
- Good Strategy, Bad Strategy: The Difference and Why It Matters – Richard Rumelt
- Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant – W. Chan Kim & Renée Mauborgne
- Crossing the Chasm, 3rd Edition: Marketing and Selling Disruptive – Geoffrey Moore
- The Balanced Scorecard: Translating Strategy into Action – Robert Kaplan & David Norton
- The Strategy-Focused Organization – Robert Kaplan & David Norton
- Strategy Maps: Converting Intangible Assets into Tangible Outcomes – Robert Kaplan & David Norton
- Alignment: Using the Balanced Scorecard to Create Corporate Synergies – Robert Kaplan & David Norton
- Objectives and Key Results: Driving Focus, Alignment, and Engagement with OKRs (OKRs directly link to Strategy and I want to mention my friends Paul Niven and Ben Lamorte)
- Also, I want to mention my friend Paul Niven’s books (although I only read the first one but I mentioned these because Paul is a true expert on Strategy) on Strategic Balanced Scorecards (Paul is a world-class expert on this topic): 1. Balanced Scorecard Step-by-Step: Maximizing Performance and Maintaining Results, 2. Balanced Scorecard Diagnostics: Maintaining Maximum Performance, and 3. Balanced Scorecard Evolution: A Dynamic Approach to Strategy Execution
- Finally, for those who are really into this topic – “Strategy: A History” – Sir Lawrence Freedman (a gift I got from a former apprentice Michael Kuznetsov who is one of the best talents I had the honor of leading during the days at InsightSquared)