Strategy without tactics is the slowest route to victory. Tactics without strategy is the noise before defeat.-- Sun Tzu
A study not so long ago said that most companies have strategies, but 70% to 90% of them fail to execute those strategies.
That's a little simplistic. I don't think it reveals the whole story.
Look at any organization in trouble, and odds are you'll find a group of frantic, anxious people. Leaders will be demanding "answers," managers will be building "action plans," and workers will be tearing their hair out trying to implement them all.
There's a lot of "executing" going on, but there are no results.
What gets lost in such situations is how the organization got in that awful place to begin with. And almost 100% of the time, it got there because it lacked an adequate purpose-driven strategy.
It's easy to see why people prefer tactics over strategy. Tactics are about action and answer "How do we do X?" questions.
Strategy is about identifying what it is you want to do about the problem or opportunity, not how to solve it. Strategy defines what X ought to be, and why you want to do it.
The Purpose-Driven Strategy
A well-defined purpose is the context in which you create strategy. Your organization's purpose should be defined by a simple mission statement that is understandable by the average ten-year-old.
Your purpose is the compass that guides all strategic decisions. Without purpose, strategy becomes mere shooting in the dark.
The purpose of your organization is its reason for being. It embodies the answer to a simple question: Why does the organization exist? When you have the answer to that question, you have the foundation you need to think about strategy in the right way.
The overall strategy for your organization and your purpose are inextricably linked. For instance, if your purpose is to be the voice of the insurance industry, your strategy might include educating businesses and consumers on the different types of insurance available to them, or taking on the growing problem of insurance fraud.
Strategy and purpose go hand-in-hand, and lead you always to the correct tactics for getting your organization where it needs to be.
Creating An Effective Strategy
Strategy is the answer to the million dollar question, "What are we are we going to do about X?"
When you have the right strategy, the right tactics needed to achieve that strategy fall into place all by themselves.
To create an effective strategy:
1. Identify the Key Problems and Opportunities Your Organization is facing.
The number of problems and opportunities facing even the smallest organization is fairly large. Developing a strategy for handling them hinges first on your understanding of what those problems and opportunities are.
Identification is probably the easiest of the five steps. Gather your top people and devote thirty minutes to listing the problems and opportunities you're facing. Do not concern yourself with prioritizing yet. Simply get the list together as quickly as you can.
Once you have a list that you feel confident is complete, proceed to the next step.
2. Identify the Top Five Challenges.
Gather your team again, and be prepared to spend whatever time is necessary to reach agreement on your organization's top five challenges.
Here the waters get a little murkier. One person's challenge is another's trivia. Do whatever it takes to reach a consensus on the top five challenges. Refer back to your organization's purpose as you think through the challenges. Let your purpose guide you to identifying the challenges that are key to making it possible for your organization to remain relevant to the people and businesses it serves.
3. Decide What You Will Do to Address Each Challenge.
Once you have identified the top five challenges, you can talk about what needs to be done to address them. You therefore create a strategy for approaching each challenge.
For example, if one of your challenges is customer retention, the strategic approach to addressing that challenge might be to (a) find out why customers are leaving and (b) create programs and initiatives that resolve those issues.
Again, gather your team. Be prepared to spend at least half a day deciding what you will do to address each challenge. Do not try to come up with specific solutions. Focus only on the general approach to addressing each of the five challenges.
4. Identify the Initiatives and Goals Necessary to Implement the Strategy for Each Challenge.
Now it's time to start digging deeper into each of the challenges. Here you are going to set one or more goals for each challenge. You'll also want to identify specific initiatives or campaigns related to each, where appropriate.
Your goals and initiatives are high-level tactics you will later break down into action plans containing due dates, specific actions, and the people who are responsible for seeing that those specific actions are accomplished by the due dates.
Remember: A goal consists of a specific result and associated date. Using the example from Step 3, one goal might be to put a customer satisfaction program in place by the end of the third quarter.
5. Create a Detailed Action Plan for Reaching Each Goal.
Here's where organizations fall down most often: taking the right actions to reach identified goals. Once more, assemble your team and assess your goals.
Break each goal down into the steps necessary to ensure you have the greatest opportunity for achieving it. Each plan you generate must have discrete, achievable actions. Every action must have a due date and an owner. At this point, applying some of the basics of project management will take you a long way toward achieving each goal.
As you can see, taking this top-down approach for creating an effective strategy can give you the best possible chance of success for the long term. The five-step process works for projects large and small.
The key is to work through the steps, always keeping your organization's purpose directly before you. With your purpose as your guide, and power by intention, you cannot help but reach your organizational goals.
Michael Knowles is co-author of The Entrepreneur's Concept Assessment Toolbook (available at http://www.booklocker.com/books/1988.html or Amazon.com). His company One Straight Line works with businesses who are struggling to refocus and reenergize their organizations to better serve their customers. Sign up for The Arrow, their free biweekly newsletter, by sending email to subscribe@onestraightline.com.