What’s masquerading as your strategy?

Strategy, good strategy, is hard. You need time for it. Time to get into the headspace of working on your business, not in it. You need data. Data on your competitors, data on your customers, data on your internal financials and their drivers. And, hardest of all, you need a little magic. That’s the spark that distils all that data into a set of key issues and gives you an idea of what you’re best to do about them.

Since good strategy is hard, it shouldn’t surprise us that some attempts aren’t really strategies at all. Here are four common strategy imposters:

It’s a BUDGET

It’s a HOPE

It’s a VISION

It’s TACTICS

 

These four imposters aren’t bad in themselves, of course. I wouldn’t want to be without a budget or a vision! But

Will the real strategy please stand up?

 

The CEO and the customer

Are you the leader of your business? If so, when was the last time you spoke to customers, or watched them actually use, or trial, or consider your product or service? If it was last week, don’t let me get between you and the flat white that’s steaming on your desk. If it was much longer, stick around.

Once, there was a CEO of a construction company. He wasn’t often at his desk because he was out talking to people.

He talked to the company’s bankers and accountants.

He talked to the construction materials suppliers.

He talked to local councils.

He talked to landowners.

He talked to the managers leading the company’s regional businesses.

And he always fronted up at sales conferences to talk to his employees who worked at the coalface.

One day, he talked to a consultant about marketing strategies to sell more buildings.

She said, “When you talk to your customers, what do they say they want?”

“Customers! I hate talking to bloody customers.” Continue reading

A Half-Baked Strategy

Use this story if you need to show how important it is to think hard about what different kinds of customers really value, and what it will cost to service them. It might also come in handy if you need to warn against killing the goose that lays golden eggs before you’ve got a really, really good idea of where to find another one.

Many years ago, there was a bakery wholesaler with branches all around the country. This wholesaler – let’s call them BW – sold the main ingredients for breads and cakes, as well as a number of specialty additives. BW’s largest customer group, and its most profitable, were small-medium bakers including specialty confectioners; they also did a little business with keen home and craft bakers. One customer group they’d never had much luck selling to, however, were the very big buyers, like factory bakers and large bakery and fast food chains. Continue reading

A Tale of Two Boxers

If you’re struggling to get your company, or clients, to shed their complacency and to face a gathering storm, you may find A Tale of Two Boxers useful. It’s a cautionary story about how lethal it can be not to recognise your true source of competitive advantage.

A long time ago, but not so far away, there was a small country with two cardboard box makers. Let’s call them Boxer C and Boxer K. If you wanted cardboard boxes for your soft drinks, or your packets of pills, or bags of fasteners destined for factories, you had to buy from one of these two companies. It was much too expensive to ship boxes in from the big country further away. Continue reading