5 Critical Moments to Evaluate Your Strategy

businessman with hat in front of two roads

“To see things in a new way, we must rise above the fray.” -Rich Horwath

 

Not too long ago, I featured Rich Horwath, the author of Elevate: The Three Disciplines of Advanced Strategic Thinking here to discuss the common mistakes of strategic planning.  Rich has helped thousands of managers with the strategic process.

After the interview, I decided to follow up with him to ask when leaders need to abandon or re-evaluate a strategic plan.  I have seen executives stick with a plan and others modify or abandon a plan.  Most leaders don’t want to open up the plan over and over because it shows indecisiveness, a lack of confidence or it creates confusion.  That said, there are times when a major review or rewrite is important.  So, I asked Rich:

When is revisiting the plan the right thing to do?

The ability to modify strategy at the right time can literally save or destroy a business. Here is a checklist of five moments when it is critical to evaluate your strategy.

 

1. Goals are achieved or changed.

 

Goals are what you are trying to achieve, and strategy is how you’re going to get there.

It makes sense then, if the destination changes, so too should the path to get there.  As you accomplish goals and establish new ones, changes in resource allocation are often required to keep moving forward.  In some cases, goals are modified during the course of the year to reflect changes in the market, competitive landscape, or customer profile. It’s important to reflect on the strategy as these changes occur to see if it also needs to be modified.

 

“Goals are what you are trying to achieve, and strategy is how you’re going to get there.” -Rich Horwath

 

2. Customer needs evolve.

 

The endgame of business strategy is to serve customers’ needs in a more profitable way than the competition.  But, as the makers of the Polaroid camera, hard- cover encyclopedias, and pagers will tell you, customer needs evolve.

The leaders skilled in strategic thinking are able to continually generate new insights into the emerging needs of key customers.  They can then shape their group’s current or future offerings to best meet those evolving needs.

 

“The endgame of business strategy is to serve customers’ needs in a more profitable way than the competition.” -Rich Horwath

 

3. Innovation changes the market.

 

Innovation can be described as creating new value for customers.

The new value may be technological in nature, but it can also be generated in many other ways including service, experience, marketing, process, etc.  It may be earth shattering, or it may be minor in nature.  The key is to keep a tight pulse on your market, customers, and competitors to understand when innovation, or new value, is being delivered and by whom.  Once that’s confirmed, assess your goals and strategies to determine if they need to be adjusted based on this new level of value in the market.

 

4. Competitors change the perception of value.

3 Common Mistakes of Strategic Planning

Chess - Bad Move

 

I’m always looking for ways to improve the strategic planning from a dreaded annual activity to a meaningful, helpful process.

Recently, I had the opportunity to read Elevate: The Three Disciplines of Advanced Strategic Thinking by Rich Horwath.  Rich has helped numerous companies and managers with the strategic planning process and evaluating strategic capabilities.  I had the opportunity to talk with Rich about the most common mistakes leaders make.

 

“If your strategic plan isn’t driving daily activities, then you’ve wasted time doing the plan.” -Rich Horwath

 

3 Common Mistakes of Strategic Planning

 

Rich, you’ve worked on strategy both as the CEO of the Strategic Thinking Institute and before that as a Chief Strategy Officer.  What are the most common mistakes you see in strategic planning?

 

There are typically three mistakes when it comes to strategic planning.

 

“The number one cause of bankruptcy is bad strategy.” -Rich Horwath

 

Mistake #1:  Confusing strategy with other planning terms.

 

The first is the group not having a universal understanding of what strategy is and how it differs from other key planning terms such as mission, vision, goals, objectives and tactics. There’s a tremendous lack of precision when it comes to strategic planning and that starts with the fundamental building blocks.

 

“Concepts change thinking and tools change behavior.” -Rich Horwath

 

Mistake #2:  Regurgitating last year’s plan.

 

The second is that most plans are simply a regurgitation of last year’s plan.  This is because managers don’t think before they plan.  I’m a big believer that new growth comes from new thinking.  If you don’t take time and tools to generate new insights, then don’t expect your group to perform any better than the year before, or the year before that.

 

Mistake #3:  Not linking the strategic plan to daily activities.

6 Steps to Building a Powerhouse Organization

Silhouette Of Basketball Basket
This is a guest post by James M. Kerr. James is a Partner at BlumShapiro Consulting. He is a business strategist and organizational behaviorist.  His latest book is The Executive Checklist: A Guide for Setting Direction and Managing ChangeYou can follow him on twitter.

Chemistry is the Secret to Success

The tip-off of the annual NCAA Men’s Basketball Championship triggered a question in my head: “How does a business leader build a perennial powerhouse like some of those NCAA basketball teams do every year?”

Clearly, the finest companies in the world are the ones where management and staff share an unrelenting passion to be the best.  How do leaders foster this passion for winning?  Certainly, getting the right people on the team, setting a common goal and enabling success differentiates the best from the rest.  But, there’s an intangible in the equation, the importance of which should not be ignored. It’s called chemistry.

 

Placing your highest regard on impeccable execution leaves no room for mediocrity. -James Kerr

 

Why is chemistry important?  Simply put, high performing people resent mediocre performing ones and mediocre performers begrudge those that perform at the highest level of achievement.  Indeed, getting the chemistry right is as important to the establishment of ongoing business success as garnering a talented team and constructing a compelling vision for it to follow.

We all want to be captivated by a “Big Idea.”  It’s part of the human condition to want to be part of something special and contribute to making it so.  Once enthralled, we want to be surrounded by like-minded people who share our enthusiasm and thirst to achieve.

As business leaders, it is our job to provide a vivid and exciting vision and ensure that we hire the “right” people – ones that buy in, fit in and want to work together to realize that stirring vision.  And, my friends, the latter comes down to understanding and managing “chemistry.”

 

The best businesses consistently remain fixated on being the best. -James Kerr

 

Building the “Right” Chemistry

So, what steps can be taken to shape winning chemistry within an organization?  There is no simple recipe.  However, there are six guideposts that leaders can use to move the process forward, including:

 

1. Champion a “Do Your Job” attitude – Do your job.  There is much implied in those three simple words, including being prepared, paying attention to detail, working hard, and putting the team ahead of yourself.   It also points to the need for senior leadership to ensure that every member of his or her organization understands what their job is and that they prepare every day to execute it.

4 Leadership Secrets of Alexander the Great

Alexander The Great

This is a guest post by Joe Scherrer. Joe is a decorated Air Force veteran, an author, a speaker, and a coach. His ebook includes lessons from 82 of history’s greatest leaders. You can follow him on Twitter.

History is replete with stories of great generals—heroes who saved their men, their cities and their countries. It is equally populated with those who failed in their task, sometimes spectacularly.

However, what few realize is that great generals and failed generals are sometimes one and the same person.

Alexander the Great is a case in point. He conquered most of the known world before most people today are out of college and into their first job. In an amazing eleven-year journey of conquest—unparalleled in the history of the world—he rode more than 10,000 miles, fought 70 battles without losing a single one and conquered from Egypt to India.

 

By being great, you can change your part of the world for the better. Joe Scherrer

 

But as great as he was, he also had a complex and volatile personality that led to some tragic mistakes.

Read on to discover a few lessons from Alexander’s remarkable leadership career that will help you be a better leader today.

Lesson #1: Seek Out the Best Mentors…Then Learn from Them

Alexander had the benefit of being educated in political, military, and cultural matters by excellent tutors including none other than Aristotle.

He also accompanied his father on several military campaigns and distinguished himself in battle at a young age.

He no doubt drew upon that upbringing when he assumed the throne at only 20 years old after Philip was assassinated.

Alexander wasted no time in using his position as general of all Greece to take the strong army his father had left him and expand Greek hegemony into Persia.

What You Can Learn: Prepare yourself by being open to what others more senior can teach you. They’ve been where you are, and they are where you want to be. Adopting an attitude of continual learning from those you respect will make you a better leader.

Lesson #2: Want to Increase Your Decision-Making Flexibility? What-If Everything

Alexander’s conquests brought him into contact with a wide variety of armies and cultures. To deal with the ever-changing military, political, cultural, and economic landscape, he planned meticulously, analyzed every piece of information and formulated as many alternatives as possible.

From a military standpoint, such efforts reduced his risk, increased his flexibility, and enabled him to operate with speed and decisiveness with his highly trained and exceptionally loyal army.

What you can learn: A flexible and adaptable strategy is a crucial element of your success as a leader. Systematic planning, a comprehensive view, and incorporating a range of options allows you to change your strategy depending on the situation and environment you face. In so doing, you can put together a strategy that will serve you and your organization well as you set about conquering your small part of the world.

 

A flexible strategy is a crucial element of your success as a leader. –Joe Scherrer

Out Execute the Competition

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Irv Rothman is the president and chief executive officer of HP Financial Services, a wholly owned subsidiary of Hewlett-Packard Company. Prior to joining HP, Rothman was president and chief executive officer of Compaq Financial Services Corporation where he led it from its founding to growth of over $3.7 billion in total assets.

Irv is the author of Out-Executing the Competition.  What I really admire is that Irv is donating all of the royalties he earns on the sale of the book to Room to Read, an organization dedicated to children’s literacy.

 

The best way to out-execute the other guy is to know your customer’s business as well as you know your own. -Irv Rothman

 

Attracting the Right Talent

Much of success in business is about finding and cultivating the right talent.  How did you attract and retain the talent needed to accomplish your goals?

Attracting and retaining the right people starts with a leadership commitment to first develop high performers in-house.  And this has to be more than an annual “talent management” exercise.  It’s an activity that leadership must consistently demonstrate is important by developing people and promoting from within.  This sends key messages to an organization:

1)   Leadership can be trusted to do as they say they will.

2)   Career opportunities exist…. No need to look elsewhere.

3)   Leadership recognizes and acknowledges that outside hires are a 50/50 proposition.

In short, provide an atmosphere where people can learn and achieve advancement based on merit.  Not only will the good people stick around, their hearts will be in it.

 

Developing a Culture of Execution

 

Out-Executing the Competition

Your book title is all about execution.  How do you develop a culture of execution?

A culture of execution starts with devotion to the customer.  Since it is theoretically easier to keep a customer than to find a new one, all messaging and reward systems need to be packaged around a “customer for life” philosophy.  And a pay-for-performance compensation system is a must.  Moreover, it can’t be black box; people need to be clear as to what rewards can be expected from results and behaviors.  Once you’ve got all that organized, creating an environment where people have freedom to act on behalf of the customer is crucial. You can’t have a circumstance where people are bound by the linear strictures of a traditional command and control organization. It not only frustrates your employees, it also makes for dissatisfaction on the part of the people on the other end of the phone.