“Strategy” is one of those words that is loosely bantered about without much precision. There seems to be a lot of confusion about what a strategy is. There is even more confusion around what a strategy does. In working with groups to develop strategy, I’ve learned a few important lessons: 1) strategies that try to answer every question are not strategies (and never get completed), and 2) strategies that answer too few question become pretty posters and Powerpoint slides but do little to drive decision-making and action. A good strategy sets the context in which an organization should operate. A strategy should:
- Set boundaries
- Create focus
- Enable prioritization
The strategy accomplishes this across five dimensions:
- Who the company serves
- What the company provides
- How (at a high level) it is provided
- Where and when it is provided
- To what end (why) the company provides it
Simply arraying the areas of context (boundaries, focus, prioritization) against these five dimensions creates a simple framework for defining a strategy. Such a strategy will drive decision-making and action without actually articulating every decision and action. That allows the organization to remain nimble and responsive to changes in the environment while moving toward a broader goal.
The key is focusing on results or outcomes, not tactics. For example, an organization might have a strategy to focus its resources on mission critical processes. The company might choose to outsource to accomplish this strategy but outsourcing is not the strategy. While subtle, the difference is important.
Good strategies create a framework for decision-making and actions. They allow autonomy and improvisation while keeping the organization moving in the right direction.
