Don’t Let Your Strategy Be Another Statistic: Here Are Four Keys To Making It Work

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How does your organization develop new business strategies? If it fits the norm, your CEO and several close associates hole up in a comfortable spot where they can play golf one day and ski the next. Then they emerge from the sauna with a new strategies predicated on customers behaving precisely as they should to meet your internal goals and consequent shareholder expectations.

And how have they formulated these goal-driven strategies? In all probability, PowerPoint and Excel were the two most important planning tools—with the human mind finishing a distant third. Customer input? Nowhere in evidence. Unless, of course, they had mounds of customer satisfaction research in front of them measuring how customers have viewed the business in the past—in which case, management very likely sped away from these strategy sessions with both hands firmly on the wheel and both eyes firmly focused on the rear view mirror.

Comforting, isn’t it? Not to mention motivating.

But enough of "how it shouldn’t be." How do you recognize a well crafted business strategy—without waiting for outcomes? Let’s count the ways (four, to be exact).

It’s a living strategy if …

  1. It is opportunity-drive, not goal-driven. Turn off PowerPoint. Let Excel crash on its own. Step on your calculator. And then turn loose your mind. Find your "inner customer" by filling your head with customer input, by opening your ears wide to what customers are saying—before you try to plan anything. Then identify everything you’re capable of doing to solve customer problems, create customer convenience, cut customer costs and add value to customers. From there, it’s a downhill ride. Just evaluate the business potential of each opportunity and prioritize opportunities accordingly.

    Pop quiz: Do you think Enterprise Rent-A-Car’s "We’ll pick you up" strategy started with customer opportunity identification or as a response to financial goals?

  2. The goals are the outcome of planning, not the driver. After you prioritize customer opportunities—and only after—should you set quantitative goals. These, by the by, are the very same goals almost every planner inappropriately forces on the planning process up front—rather than allowing them to emerge naturally from the process.

    From personal experience working with 3M, I can testify to how much this approach contributed to the company’s legendary record of financially successful innovation—which now may be in jeopardy from new management’s obsession with numbers.

  3. The inflow of customer input exceeds the outflow of advertising and other marketing communication. First-rate strategies are centered on understanding and interpreting customer needs and preferences and meeting these needs and preferences—not on using advertising to try to change brand preferences.

    Hey, take you pick here. Would your rather be Southwest Airlines, which listened to and read the flying public correctly? Or would you choose UniTED Airlines, which, years after SWA set the example, paid a gazillion dollars to an advertising agency to name its knock-off no-frills operation TED and gazillions more to publicize the name?

  4. The strategy creates a win-win value exchange between customer and company. Believe it or not, GM’s super discount rates aren’t creating a meaningful value exchange with customers. In fact, they’re not even sustainable for GM. GM’s new "strategy" is giving away cars to retain market share. But it’s a desperation measure, because catchy ad lines like "an American revolution" and the millions of dollars of media outflow behind it can’t overcome a stable of often poorly designed and built, boring cars. If you want to see meaningful value exchange, look at Lexus. Customers willingly pay a premium price for products that are exquisitely designed, precision-built and come with free loaner "Lexi" on those rare occasions when they do need service. Toyota gets its margins. Customers get what they’re after. And it’s damn hard to shake a Lexus owner out of a Lexus. Of course, you don’t have to shake anyone out of a Detroit car. Let the car do the shaking for you.

Business strategies that meet these four requirements rarely fail. They live, breathe and produce. On the flip side, the further away from these four tenets strategies wander, the less likely they are to have any life in them at all. You betcha.

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