Creating a Strategy for Success

Strategy

Are your Goals SMART?In our last article I talked about having a crystal clear vision with compelling reasons for why you want to achieve it. Unfortunately this alone will not be enough to take your business to success. Having a crystal clear vision and the clarity of purpose, while essential, is not enough.

Great Leaders inspire people to follow; They empower people. By their words and actions they provide compelling reasons for people to follow them. This could be illustrated by the leadership skills displayed in the Gallipoli Campaign, a great military failure. Thousands of soldiers followed their leaders into battle to pay the ultimate price. They failed not through lack of motivation or having compelling reasons to win the battle but they failed due to bad strategy.

You cannot rely on luck – you need a real strategy

Many people start business with a lottery mindset.  Their strategy is built around being in the right place at the right time, that somehow just turning up ready is the strategy for success.  Most people in life enjoy the occasional punt,  but  some people rely on this as their primary strategy for success; they rarely miss getting their entry into Gold Lotto for the Saturday night draw!

The first rule for success is this; You have to believe that you are in control of your life.  You control whether you are successful,  you also control your mediocrity and failures.  You can’t play the victim.  Playing the victim takes away your control in the game of life.  By taking control you can self assess,  take credit for  success and learn from mistakes.  A person who makes no mistakes is one who does nothing at all, but in doing so makes the biggest mistake of all.

Bad Strategy

Bad strategy tends to include plenty of rhetoric, using high sounding, motivating words. More often than not many business owners confuse strategy with Goals.

You might hear something like “we want to be regarded as the market leaders”. Unfortunately this by itself fails in strategy as strategy must entail the “how”; How are we going to become market leaders? Bad strategy regularly focuses on the results required but contains no action plan about how to get there. Or there may be many actions that are unconnected with each other, and worse could be actually in conflict with one another.

Bad strategy was especially obvious during the Global Financial Crisis (GFC)  as people followed the herd mentality. Most people join the herd, assuming that someone must have done their homework. (The more people that join, the more it appears to be working.)  Warren Buffet has a great saying “Be fearful when others are greedy and greedy when others are fearful”.

In 2006 and 2007 I was getting very concerned on the future of both the property and share markets in Australia and around the world. I was recommending clients to pay down debt and not invest further funds. Governments around the world had freed up availability for credit; so much so that it had created bubbles in many asset classes. My understanding of what makes a good investment meant I struggled to see value in investing in shares or property. But by following the herd as many market participants had done, thousands of people in Australia lost a significant amount of money. Many went bankrupt and some took their own lives during the downward spiral. I saw the impact this had on many lives working with people after the GFC who had made the decision either themselves or through other advisors to borrow to invest in a broken market.

You need to be taking in pertinent data rather than ignoring it. There were a number of economist around the world discussing the problems and forecasting the bust. Those promoting it  could profit from it without taking on the risk.  During the tech boom I heard so many commentators taking the view that it was different this time, that those technology companies didn’t need to be making a profit at that point; that they would in time work out how to turn their technology into profit.  They ignored a fundamental rule; for something to be of value and succeed it must be providing value. If you make the mistake of just following the crowd and trusting the crowd you will end up where they will eventually end up. And that is a place we don’t want to go to!

One of the problems nature has given us is that our mind generally works on reflex. Much of our brain reacts automatically depending on  what is happening around us.  We were created like this as a form of protection and to enable us to use our body to the maximum potential. We couldn't possibly think of the myriad of things our body needs to be doing just to stand up. But in life many people don’t make consciously thought out decisions; they work on reflex. The art of creating a good strategy is that you must start to think consciously and stop unconscious decision making.

Before we start on creating good strategy I want you to ask yourself a few questions:

  1. Who do you see as the leading competitor in your industry?
  2. How has that company become a leader?
  3. Who are your buyers?
  4. Who do you compete with?
  5. What opportunities exist?

Understanding the current situation and challenges

To create a good strategy you must first diagnose the situation.  You need to understand the fundamental problem or problems that stand in the way of your business. You must be able to define the challenge so that you can assess the quality of the strategy that you develop. Developing a good strategy is about designing a way through a difficulty or taking advantage of an opportunity. Good Strategy anticipates real world difficulties that need to be overcome. It creates policies that concentrate resources and actions on overcoming those difficulties.

Deciding on your goals

Having a strong understanding of the challenges you face and the opportunities available puts you in a better position to choose which general goals should be pursued. A good leader will focus setting aside some goals and choose what appears to provide the 1 or 2 most attractive opportunities where it appears you can make the most inroads or breakthroughs.

Setting Objectives

Once you have set your overriding goals you must define a number of objectives. These objectives should denote specific operational targets and they must be measurable. If they are not measurable how are you going to know when they have been achieved?

Design of coherent actions

Action is the final piece of the puzzle in the creation of good strategy. Action is the “how” in relation to the goals and objectives.  Actions must provide a specific and coherent response to the obstacles to be able to meet the objectives.

Action works by harnessing and applying power to where it will have greatest effect. It is also about identifying limiting factors and focusing on removing them.

While creating actions you must also be aware of understanding what you can control and what you cant. Focus must be applied to what you can control while ensuring you are aware of what you cant.

Richard Rumelt who wrote the book Good Strategy Bad Strategy argues good strategy is a specific and coherent response to the obstacles to progress. It works by harnessing and applying power where it will have the greatest effect, whether putting a man on the moon, fighting a war or launching a new product.

To create a good strategy you must also identify any weak links in your business. After all as part of a team you are only as good as your weakest link. You could have the best product in the world but if sales are poorly trained you are hardly going to do as well. This was certainly noticeable in the challenger space shuttle example. In  January 28 1986 Space shuttle challenger broke apart killing everyone on board. They had a great team of astronauts, well trained, they had team on the ground but it all failed due to the failure of an O Ring.

To create Good Strategy you must have a strong understanding of the current situation and challenges. This will enable you  to focus and come up with a couple of the most promising opportunities while defining your overarching goals. Once known you can set measurable objectives and design a set of coherent actions to achieve these objectives. You must also be able to motivate your team to implement and take ownership of the actions to achieve the vision for the business. Motivation is about finding the core benefits of your objectives for each individual, empowering them to act.

Could you benefit from joining The Success Club?

Would you like your business to be more profitable?

Would you like your business to need you less so you can spend more quality time with  people you care about?

Would you like your business to be focused for success?

Do you need help motivating staff?

Do you feel your strategy could do with a fresh set of eyes?

If you answered yes to any of these questions read below to see how we might be able to help.

Why join The Success Club?Creating a Strategy for Success

There are a number of opportunities available to you by joining The Success Club.

Joining a Success Team would be the perfect start. Success Teams meet weekly and get you working on your business. They help you stay motivated, and keep you accountable. Many small business owners through all the work end up creating themselves a job, not a business. Success Teams follow an agenda to take your business to the Top 1%.

Are you the type of business owner who would like to see constant improvement in your business?

Are you the type of business owner who would love to have a bigger team of like minded business owners around you to bounce ideas off?

Are you the type of person who is always looking to invest in yourself?

If you answered yes to any of the above questions than joining a Success Team is for you.

Click the banner below to find out more, about joining Your Success Team.

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For a limited time every enquiry to join a Success Team will receive a free Business Health Check valued at over $500.