Lots of recent chatter about strategy. Which is the best (low price / high value)? Which tool should I use? How do we get our people to buy in? How do we execute?

Perhaps the questions are arising because of the times and folks are trying to find something, anything, that works. Or maybe it’s because the times are just now exposing weaknesses. Some thoughts:

One aspiring strategist asked, which methodology is the best? This is like asking which is the best way to affix two pieces of wood together – you could use nails, screws, or adhesive. Each method has advantages, as do others, but the very first question is what is the purpose? When the pieces are put together, how will they fit with the rest of what you are doing? Knowing why will help you choose the best method.

Another asked if he should pursue a low-price strategy. I told the story of my b-school house mate who ran a business (blank audio cassettes, remember those?). Market research showed that many potential customers didn’t consider his product because the price was too low! Why? Perceived low quality (the actual quality was very high). He had pursued a misguided low price strategy because he thought that was the only way to compete. Needless to say, he raised prices, invested returns in other attributes customers identified as important: availability, rapid delivery, service and of course maintaining quality – all part of the complete product – and increased sales dramatically. The key question is what is your differentiator? Listen to (don’t ‘sell’) your customers to determine what they truly need and want. Just in time delivery? Sales training for their associates? Assistance with in-store displays / stocking? Or…? In other words, find out how to make it easier for customers to buy from you than from your competitor.

Yet another asked how does one sell (advertise) the strategy to the organization? This question at first dismayed me since I have never felt that strategy formulation could be separated from execution. But I now recognize there are whole groups of people who think their job ends when the document is delivered, many of them academically trained with the latest techniques. These strategies rarely get executed.  New strategies require new processes, structures, rewards systems, cultures and yes, sometimes new people. You need to ensure that your core operating model is fully aligned to your strategy and, importantly, that it delivers performance improvements

Finally, some hard won pieces of wisdom, gained over a couple decades.

1.  Keep it simple and understandable – if you can’t explain it on one page, it’s not going to get executed.

2.  Good strategy is data-driven, not just gut feel. And it requires insight, not just analysis.

3.  Strategy is a continuous activity, not a once-a-year event.

4.  When the environment changes, so must the strategy.

5.  Strategy cannot be delegated. The organization’s leader is the chief strategist.

6.  Strategy is really, really hard work.

7.  New strategies require that you build, or rebuild, the organization.  If you overlay a new strategy on an existing organization, it will fail.