“Strategic” is an ambiguous term that often has different meanings to different people. Yet it’s frequently referenced as a skill desired in leaders. When I hear an executive say that they or a team member needs to be more strategic, I ask what they mean. The responses can be quite varied. Saying you want someone to be less tactical and to think big picture, does not go far enough in providing a clear understanding. What skill set are you seeking?
Great strategy is usually enabled when there is a clear organizational mission and vision that can guide innovative thinking. A company that states their vision as “being the best” at something does not necessarily provide a clear path to innovative approaches. But better defined vision statements include “To build the Web’s most convenient, secure, cost-effective payment solution” or “To seamlessly connect riders to drivers through our apps.” Better definition helps differentiate a company from the competition.
Many companies run on autopilot when it comes to strategy. They follow a planning process and turn to the same people for ideas or new approaches. Other companies have the luxury of having advisors from different backgrounds that provide fresh perspective. Frequently, leaders become so busy running their companies or dealing with day-to-day operations that they have little time to think creatively or plan towards the future.
Setting aside time to think strategically is a start, but great ideas take time to germinate.
Organizations can be proactive or reactive when it comes to strategy. In the reactive mode, innovation is triggered by an event such as loss of major client or market share. When an organization is proactive and intentional about strategy, they often have a more formal approach to innovation. They dedicate people, time, and resources.
Strategy can involve incremental innovation. Small improvements are made to your company’s existing products, services or processes to improve efficiency or experience.
Or strategy can involve disruptive innovation. Disruptive innovation can look like:
Breakthrough strategy involves taking a broad, long-range approach to problem-solving or decision-making and foreseeing opportunities that lead to a competitive, sustainable advantage. In this case, strategic thinking focuses on finding and developing unique opportunities to create value. This value can come from harnessing a new technology, a new business model, or a niche strategy. Breakthrough strategy is about anticipating and adapting to a changing environment. It sets you up to to seize tomorrow’s opportunities today, unlock value, and help the business be more competitive.
Designing a strategy that creates competitive advantages is not always easy. Whether it is delivering products and services in a new way or developing a niche market, innovative strategy takes time.
Leaders who are seeking breakthrough thinking often have operating models within their organizations that encourage creative solution design. These models might include design thinking, open innovation, and idea incubation. They question the status quo of their company and industry. They get to the root of assumptions and beliefs about value creation.
Game-changing information often comes from two places:
Executive exchanges and group masterminds provide the opportunity to meet with executives from different industries with different expertise. These sessions can provide access to knowledge from a broad range of sources and inspiration where you least expect it.
Another approach for designing breakthrough strategy is to reframe beliefs or widely shared notions. Focus on customer preferences, the role of technology, regulation, cost drivers, differentiators, and competitors. Explore what supports these beliefs.
The keys to realizing breakthrough strategy are:
Strategic leaders think ahead, while also taking into account lessons from the past. They move fluidly between divergent and convergent thinking, understanding interdependencies between business activities while also being able to look at the organization and industry holistically and objectively. They have both the visionary thinking to explore long-term possibilities and the pragmatic thinking that understands on the ground operations.
Armed with industry foresight, customer insights, an analysis of operational systems and interdependencies, strategic leaders synthesize information from many sources before developing a viewpoint. They are able to elevate their thinking and apply judgment during analysis about how components fit together and with the bigger picture.
Being strategic goes beyond designing strategy—you also have to deliver it. To effectively deliver it, you need a communication plan that gains the support and influence of others. Such a plan begins with understanding people’s concerns and risk tolerance.
When sharing information, strategic leaders foster open dialogue, build trust, and engage key stakeholders. They craft storylines that clearly articulate findings, insights and recommendations and communicate key trends across industries, segments and competitors. Strategy discussions should be well defined, clearly articulate the business choices, and lay-out talent and resource requirements. Leaders also need to bring tough issues to the surface and take a stand when views diverge, even when information is incomplete.
Driving large-scale change is a balancing act that involves deciding how much energy and resources need to be spent between business-as-usual and executing on strategic objectives. Certain areas of the business may be strained. Identifying those challenge areas quickly and concentrating efforts on providing guidance where necessary will increase workforce alignment. Additionally, regularly communicating the overarching objectives of large-scale change and how exactly each person’s goals contribute to the strategic objectives are tracked and reported, will create greater ownership of the change and lead to successful execution.
Thoughts? Feel free to share your comments with me at Allexe.Law@ArtScienceGroup.com