The Four Magic Business Bullets – Strategy, Intellectual Capital, Innovation, Implementation
Just as you would develop a vision to support a mission, so
too, it is necessary to generate a strategy for accomplishing the mission and
the implementation of a vision. Strategy is the unique formula or nucleus
around which plans can be formed which leads to organizational success.
Developing strategy is not that complicated yet it is an underused activity in
many organizations. Figuring out strategy can be as basic as where is the
organization today? Where does it want to be in the future? Where is our
competition today? What is our cost position to beat them in the future?
Strategy simply defines the logic and tactics that ensure the mission and vision
will be achieved.
Quite often when the subject of “strategy” is discussed, it is assumed that we are talking about decisions and plans that will be made out there, somewhere in the future. The challenge for many organizations is to understand that they have to make decisions in the present that will help shape their future. We need to fully come to the understanding that the best possible choices made today will in fact determine much of how your future will play out. Your strategic choices today are not about future decisions, but about the future impact of the decisions you or your organization make today and plan to make tomorrow. Simply stated, what must be done today and tomorrow that will help us arrive at our desired future?
Because of the rate of change organizations face today, the older notion of a five-year strategic plan has changed. Agile, fast moving, and “evolving strategies” that ensure the success of the core business have become the norm in high-performance organizations. Evolving strategies that are continually calibrated against results, provide the clarity required in organizations, and help set more relevant direction for all to follow. Without a clearly defined and closely followed evolving strategy, organizations of all types tend to lose sight of their direction. Energy is wasted on doing things that are non-value added.
An organization without a strategy is like a ship without a rudder – it moves, but without direction. If you are in a for-profit business you should constantly be asking and answering the questions; how do I make money today? How will I make money tomorrow? What are my strategies today? What will be my strategies tomorrow? If you are a member of a non-profit and government organization you should be focusing on what are my strategies for providing services today? What will be my strategies for providing services tomorrow? What is my strategy if revenues decline? How can our organization serve the greatest good with the right amount of expenditures? All organizations should be making sure that whatever strategies they use… they are clearly understood by all stakeholders.
Under the umbrella of an overall “business” strategy, many other supporting strategies can reside. Several examples of supporting strategies are: sales, marketing, innovation, technology, service, global, quality, acquisition, partnership, human resource, learning and growth, succession planning, retention, and leadership development.
In the 21st Century, intellectual capital, information capital, and human capital will require strategic thinking and planning as never before. These areas will determine the success of many if not most organizations as we move from the “information age” to the “knowledge age.” Alignment of these areas must be put in place and used to fulfill organizational objectives. For the greatest organizational success, intellectual, information, and human talent capital should be directly linked with the traditional measures of strategic success, such as revenues, gross margins, profitability, return on investment and market share. As an organization you should be asking the question are we putting in place strategies that are aligned at all levels throughout the organization.
Solid leadership combined with intellectual capital and great human talent allows a key strategy to emerge – innovation. Quoting Peter Drucker, “Business has only two basic functions: marketing and innovation. Marketing and innovation produce results. All the rest are costs.” Innovation is “the” basis of all competitive advantage and the means by which the organization anticipates and satisfies the customer’s needs.
Innovation is the way the organization uses knowledge and technologies to create wealth, beat the competition, and pursue growth. Growth is what it’s all about. Growth is the great elixir…both personally and in business. At all times an organization should be in the process of transforming itself through an innovative and evolving strategy, so it can more effectively position itself to occupy a new strategic space in its industry. Without enlightened leadership and an evolving strategy, organizations rarely stay innovative and achieve growth.
A final step with regard to strategy is implementation. When a new or radically different strategy is formulated, it most likely will involve structural changes to the organization along with policy and procedural changes. Change always will call upon leaders to handle the tangible as well as the intangible variables, including the motivation and commitment of people, possible restatement of values, the modeling and monitoring of behaviors, and the establishing and networking of relationships.
When a serious attempt is made to transform any organization, the return on investment in the building and linking of strategies to accomplish the mission and vision of the organization will be substantial. Strategic thinking and planning will allow the organization to both sustain itself and grow. Strategy is where the rubber meets the road. Great strategies begin with solid leadership!