To win in today’s marketplace, you need a solid corporate strategy. Think of it as your playbook for success. And as CEO, it’s your responsibility to ensure it’s more than a check box type of activity. You’re the coach, the team’s leader. You can’t have your team thinking it’s a bunch of fluff and a laundry list of objectives. Objectives that they have no idea how to accomplish. Your team needs to be on the same page. And your corporate strategy must pave the way.
As we enter the second half of Q1, it’s a good time to evaluate your strategy. Ask yourself a few key questions. These will help you determine if your corporate strategy is making the grade.
Is my strategy providing the right guidance?
Your corporate strategy should set company objectives. But it also must provide insight into how these objectives can be met.
Too often, the corporate strategy stops just short of this. It will define the company’s mission, vision and values only. It leaps into a top down view of the world. For example, pressure from the board can result in setting an arbitrary revenue goal. That goal is then trickled down with little to no discussion about why it was chosen. It becomes difficult for functional leaders to make any sense of it. The result? Your team is confused, with no clear direction.
Instead, your strategy should address areas like markets, competition, and advantages. Markets give you the where. Where are we going to play? Where are you going to push your resources? It also defines where not to play. Second, consider competition. Against whom are you competing? What particular players offer competitive solutions or near substitutes? Also consider nontraditional competitors like “do nothing” or “do it themselves”. And finally, look at your advantages. Is it price, product or the experience created for your customers?
This level of detail will provide the kind of direction your team needs.
Have I determined who gets what correctly?
Your strategy also directs the investments in time, people, and money. The last piece is often the toughest – budget allocation. How do you know if you’re making the right investments? How do you decide who gets what budget?
It doesn’t have to be difficult. A good corporate strategy defines the core questions. Questions like how are we going to win? Where are we going to win? And then, you must decide how to invest in order to develop the capabilities needed.
There are simple questions to ask yourself when it comes to budget. Does the spend support the corporate strategy? Is it in direct support of the places where I mean to compete? Does it allow me to win? If you can answer ‘yes’ to these questions, you are going in the right direction. Also consider how the budget supports the other functional strategies. Are you enabling them to help meet the company-wide objectives?
Ultimately, it comes down to allocating your budget in a way that generates the most revenue growth.
Let’s face it. Your corporate strategy carries a lot of weight. It’s where the direction for the company is defined. And you must keep your head in the game. Strategies are not a one and done exercise. Taking a step back and evaluating your progress is key. If you need more guidance, download our playbook, “How to Make Your Number in 2016” here. It will walk you through how to make sure your corporate strategy is up to snuff.