7 Corporate Strategy Myths That Are Limiting Your Potential

7 Corporate Strategy Myths

Dr. Chuck Bamford’s new book, The Strategy Mindset, is a practical guide for creating a corporate strategy. Having read more books on strategy than I can remember, I particularly like this one. As I read the book, there were times I found myself arguing with the author. At other times, I was nodding. Still at other times, I found myself with immediately actionable ideas to improve the process at my own organization. And that’s why I enjoyed the read so much.

I think the most controversial part of his book is likely the myths section, where he takes apart existing myths of corporate strategy.

 

“Strategy is about making decisions that will impact the company in the future.” -Chuck Bamford

 

1. People Are Not A Competitive Advantage

Let’s talk about the myths.

First, you say that people are not a competitive advantage. You argue that almost all employees are interchangeable. Good employees are just “table stakes.” Is it not possible to have employees who, on average, are better than the competition?

It flies in the face of so many beliefs that it is just hard to accept. Employees are VERY important as the way that business delivers to customers. However, the moment that you actually believe that your employees are smarter than your competitors’ is the moment that your competitors will start beating you in the market. You have the same (or relatively the same) collection of amazing employees, capable employees, and poor employees as your competitors. All the HR processes in the world today have not changed that dynamic in companies. The employees that you have working in your company are a combination of luck (the biggest factor), HR practices, networking, and did I mention luck!

Bamford CoverI’m not trying to be divisive here, but most of your customers do not generally care (or if they care at all, it is slight) who takes care of their business needs as long as the needs are taken care of. This does not apply to every employee in a company, just most. At every company I have ever worked with or for, there is a contingent of “franchise” employees. Those are employees who, if they left the company, would impact the success of that company quite substantially. We all know who these folks are, and if executives are smart, they take care of these employees to ensure that they stay with the organization. These “franchise” employees are not just the customer-facing employees; they reside throughout an organization.

 

“Employees are not your competitive advantage.” -Chuck Bamford

 

2. SWOT is NOT Strategy

Second, you are not a fan of the SWOT. What’s wrong with the way most organizations use it?

SWOT is the single biggest impediment to doing real strategy that exists, and it exists because certain big consulting firms continue to use it with their clients, and it makes clients “feel good” without really having to do strategy.

SWOT was an attempt to bring some structure to the topic, and as a conceptual approach, it is still fairly robust. Unfortunately, many authors, academics, and practitioners decided that SWOT was an analysis tool and a means for a company to develop its strategy. SWOT is NOT strategy, and it is not an analysis tool.

Anyone can create a SWOT. It is grounded in your own biases and view of the world. In the end, a SWOT is simply the opinion of the person or group filling it out.

 

“SWOT is the single biggest impediment to doing real strategy.” -Chuck Bamford

5 Critical Moments to Evaluate Your Strategy

“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.

Strategies to Develop Major League Leadership

 

You can learn about leadership from a variety of places.  Researchers Howard Fero and Rebecca Herman decided to study leadership principles in Major League Baseball.  Touring numerous MLB clubhouses and interviewing managers from Tampa’s Joe Maddon to Los Angeles’ Don Mattingly, they developed what they call the 10 bases of leadership.

 

“Hope is energizing, engaging, contagious, and increases our spirit and ability to be resilient.” -Fero and Herman

 

Their new book is called Lead Me Out to the Ballgame: Stories and Strategies to Develop Major League Leadership.  It explores the insights learned from the game of baseball and how they apply to leaders in every situation.

I had an opportunity to ask the authors a few questions about their conclusions.

 

“If you want to be a leader, the first person you have to lead is yourself.” -Mike Scioscia

 

Tell me more about your research.  What were your goals?  Where did your research take you?

The idea came to us about 2.5 years ago when we were in a session at a management conference.  As leadership professors and consultants we know how important it is for people in all walks of life to develop their leadership skills and also know that quite often, they just don’t know how to do it.  As we sat at the conference we had the idea to marry together our love of leadership with our other love, baseball.

Lead Me Out To The BallgameThe goals for our project were pretty ambitious.  Without having any idea of how to go about achieving our goal, we decided we wanted to gain access to the players and managers from the 30 teams in Major League Baseball and find out from them how managers lead their teams, inspire trust, manage diverse populations, and deal with success as well as defeat.  Our objective was to take the stories we heard and use them to develop strategies so that people outside of the game could develop their own leadership skills.  We are proud to say that the ten Bases of Major League Leadership that are included in Lead Me Out to the Ballgame come from the interviews we held with 17 Major League Baseball managers and over 100 MLB players and executives.

Our research took us into the inner sanctum of Major League Baseball as we met with managers in their offices and in their dugouts during batting practice, and even on the third base line as they watched their players warm up.  We also met with players in the clubhouses and learned from them some of the unique ways that their managers helped them to achieve success and overcome obstacles.

 

Your book shares 10 bases of leadership and is broken into 3 major sections:  Leading Ourselves, Leading Others and Leading the Game.  Let’s touch on one of the bases in each section.

10basesofleadership

Leading Yourself.  Base number one is finding your passion.  What advice do you have for someone looking for what really makes them tick, what really drives them?

We heard some great stories from managers and players about the importance of not only finding your passion but showing it to those around you.  Ryan Doumit, a catcher, now with the Atlanta Braves, summed up many of the sentiments we heard when he said, “When the leader, the guy at the helm, believes and is passionate, it’s tough not to feel that same energy.”  This is such a great point as it’s not enough for a person to be passionate about what he or she does. To be a leader this passion needs to be seen by others.  In order for an impact to be made on a team, passion needs to be visible so that others will become excited about a goal as well.

Finding one’s passion is something we all need to do; we need to determine what it is we like to do.  Do we like speaking with people and solving problems?  Do we like crunching numbers and seeing the results emerge in front of our eyes?  Do we like teaching others and seeing the light bulb go off when an idea resonates with them?  To each of us there are different things which excite us, and it’s an individual’s task to identify them and determine what careers are a good fit for the things which excite us.

 

“What I’m most proud of is the culture change, the belief in how it should be done, and then going out there and doing everything they can to make it work and make it happen.” -Ron Washington

 

Leading Others.  Base number seven is effective communication.  What tips do you have to help leaders communicate vision and inspire others?