What is strategy? I thought you might want to know.
If you google “strategy” the following definition will appear:
“a plan of action or policy designed to achieve a major or overall aim.”
Another search result states:
Strategy is where you will focus your efforts to achieve your goals, and how you will succeed— or where to play and how to win.” It defines a specific course of action that will take you from where you are now to where you want to be.
Closer but still missing key elements. Here’s a snip from Wikipedia:
Strategy generally involves, setting goals and priorities, determining actions to achieve the goals, and mobilizing resources to execute the actions. A strategy describes how the ends (goals) will be achieved by the means (resources). Strategy can be intended or can emerge as a pattern of activity as the organization adapts to its environment or competes. It involves activities such as strategic planning and strategic thinking.
Now we are getting closer. Having been involved with business strategy over the course of my career I define strategy as:
“A thinking, doing, learning and decision-making process of shaping and achieving a future desired outcome.”
In a business context that outcome is wining customers and beating the competition. But there is still something missing in my definition:
How does an organization decide what the end goal is?
Without an endgame plan in mind, an organization just goes through the motions of activity and run the risk of achieving a noncoherent set of diffused objectives. That might work fine in the short-term (being reactive), but in the long-term, a strategic thinking competitor will outplay you over the long-haul.
The “vision statement” or “what victory looks like” is often used to state the long-term goal. Another way to state the end goal is what Lafley and Martin define as “the winning aspiration.”
According to Lafley and Martin strategy is a set of five essential strategic choices that, when addressed in an integrated way, will move you ahead of your competitors. They are:
(1) What is our winning aspiration?
(2) Where will we play?
(3) How will we win?
(4) What capabilities must we have in place to win?
(5) What management systems are required to support our choices?
Thus strategy is best described as a system of choices. Further, as realities of a competitive playing field unfolds and better understood, each strategic choice will evolve and affect the other choices to address the competitive realities.
That’s why strategy and execution are different sides of the same coin. Strategy without execution are just empty words. And execution without a strategy (plan), is simple wasted motion.
So what’s the best approach to executing and evolving your strategy? A simple planning and execution system like the One-Page-Business Plan and Execution System. The topic of a future article.