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Creating a strategy is inspirational
The document outlines the process of creating a strategic plan, emphasizing the importance of differentiation in a competitive landscape and correcting common misconceptions about strategy. It discusses various methods for strategy development, execution, and assessment, highlighting the need for a sustainable competitive advantage through thoughtful analysis and implementation. The document also lists various insights and quotes from notable figures to inspire strategic thinking and decision-making.
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Creating a strategy is inspirational
- 1. Creating a strategyis inspirational John van der Laan
- 2. Slide master Contents Purpose Whybother Slides 3-5 Not Misconceptions Slide 6 How Strategy development Traditional approach Required approach Analysis Development Execution Control Slides 7-15 8-9 10 11 12-13 14 15 Evaluate Quality of a strategy Slide 16 Inspirational Strategy is inspirational Slides 17-18 2 Have fun reading and reviewing
- 3. Challenge your (company)strategy3 Why - Can I state our strategy? - When was the last strategy update? - Have we successfully executed our strategy? - What are our capabilities that distinguish ourselves from competition (USP’s) Please read further if …
- 4. What is aStrategy4 Purpose 1. A method or plan to realize a desired future, such as a goal or solution to a problem. 2. The art and science of planning and allocating resources for their most efficient and effective use. …. to deliver value to the organization’s stakeholders and meet the objectives of the organization. The positioning of your business against others Direction to sustainable competitive advantages How to create value delivered through the value proposition The manner in which a company strives to be unique Ref.: www.businessdictionary.com Purpose
- 5. Why bother? Strategy isabout making choices, trade-offs; It’s about deliberately choosing to be different. You cannot be all things for all people. Key questions hereby; What is our fundamental goal What business are we in What scope of business should we compete in How will we be different 5 Purpose In current highly competitive, VUCA, environment, it is very hard to differentiate yourself from the competition and not competing on price only, especially on commodities!
- 6. Misconceptions about strategy Strategy≠ objectives Strategy ≠ actions Objectives and actions are a result of successful strategy execution. 6 Not Realize budgets Increase revenues /margin Improve customer satisfaction Differentiate products Increase shareholder value Increase market share Reduce costs Launch a new product/s ervice Find more sales channels Implement a CRM system
- 7. Strategic planning Traditional approach Often bottom up Financial Incremental in nature, mostly through SWOT process Review of past results only Required approach Step away from all day-to-day activities System-design perspective required instead of own functional management view Longitudinal direction mindset Strategic planning is a journey, not a “two day at a resort project” 7 How
- 8. Strategy – traditionalapproach Option 1: SWOT analysis (+ confrontation matrix) Advantages - Relatively quick method - Capitalises on opportunities - Deter threats / take advantage of your strengths - It concentrates on the most important business affecting factors Disadvantages - It is incremental in nature - Is only one stage of a business planning process tool; it doesn't prioritise issues and doesn't provide solutions or offer alternative decisions - Different goals; often also used as relationship builder with other departments 8 How
- 9. Strategy – traditionalapproach Option 2: Copycat most successful competitor Advantages - Quick method - Cheap, low R&D costs or market development costs Disadvantages - Not sustainable - Risk of getting into price competition as determinating factor 9 How
- 10. Strategy planning process10 How AnalysisDevelop Execute Control Market Plan Process Organize Explain Review ReviseCompany Outlook Review Roll out Align Strategy
- 11. Phase1: Analysis11 How Internal Analysis External Analysis Outlook Strategy PyramidBusinessModel Canvas Porter Five Forces ModelCompetitor Analyses I.e. I.e. I.e. I.e. Customer Groups Customer needs Technology DOMAIN SCOPE “Abell” business domain I.e.
- 12. Phase 2: Development12 Strategyhaxagon Method / Result Zero (null) option Result of changing nothing Market trends and drivers Upcoming opportunities SWOT and confrontation matrix Find high opportunity, high risk and attention areas. RBV - Resource Based View of the firm Find valuable resources or capabilities of the organisation (Barney) Value strategies of Porter and Treacey & Wiersema Porter: Cost leader, differentiation or focus Treacy & Wiersema: product leadership, operational excellence or customer intimacy. Blue Ocean Strategy Thinking outside the box and look for uncontested market space. (Augmented) services Try finding new market propositions through a combination of products and augmented services. …. …. Blue Ocean Strategy Market trends and drivers Value Strategies Porter and T&W RBV of the firm SWOT & Confrontation Strategy development Augmented Services How Use different methods to create different sustainable options
- 13. Strategy development shouldaim to develop sustainable competitive advantage by analysing possibilities and alignment. 13 Each different strategy development method on itself creates valuable options, but finding coherent and mutually reinforcing opportunities through different analyses will bring a highly differentiating, innovative value proposition. This creates sustainability and increased barriers to imitation. Blue Ocean Strategy Market trends and drivers Value Strategies Porter and T&W RBV of the firm SWOT & Confrontation Strategy development Augmented Services How Phase 2: Development
- 14. Phase 3: Execution14 How Strategyis useless, if it isn’t implemented correctly (Michael Porter). Commit to the chosen identity; Shared understanding of the value proposition Engage and enable the organization Create operational targets Plan everyday actionable goals Implementing and sustaining Focus on the barriers of execution Create quick wins
- 15. Phase 4: Control15 How The“DMAIC” cycle Define Measure Analyze Improve Control KPI’s Analysis Develop Execute Control Market Plan Process Organize Explain Review ReviseCompany Outlook Review Roll out Align Strategy
- 16. Quality of astrategy16 The more unusual and complex the strategy, the harder is the task of convincing others…. but, as Amazon and Apple have proved, the most valuable strategies are almost of necessity the most unusual. A good way to understand the challenge this poses is to categorize strategies along two distinct dimensions: quality, measured by a strategy’s ability to generate cash over the long run, and ease of assessment, measured by the effort required to estimate this future performance. Money drain Low sustainable value, check business case Rare Leadership challenge Avoid easy to imitate High potential Ease of execution EASEOFASSESSMENT QUALITY OF STRATEGY LowHigh HighLow Re-invent Re-invent Ref. T. Zenger, HBR 11- 13 The quality of a strategy is extremely difficult to assess and is revealed only as strategic actions are pursued and results observed. Evaluate
- 17. 17 “The essence of strategyis choosing what not to do” Michael Porter “A satisfied customers is the best business strategy of all.” Michael LeBoeuf “Success is 20% skills and 80% strategy. You may know how to read, but what is your plan to read?” Jim Rohn “Strategy is not a lengthy action plan. It is the evolution of a central idea through continually changing circumstances” Jack Welch “Without strategy execution is aimless, without execution strategy is useless” Morris Chang “Thus what is of supreme importance in war is to attack the enemy’s strategy” Sun Tzu “Strategy is thinking about a choice and choosing to stick with your thinking” Jeroen de Flander “Strategy is a pattern in a stream of decisions” Henri Mintzberg “It’s not enough to be busy, so are the ants. The question is what are we busy about?” Henri David Thoreau “Business strategy is the battleplan for a better future” Patrick Dixon “Manage the top line: your strategy, your people and your products, and the the bottom line will follow” Steve Jobs Inspirational
- 18. 18 The things thatdistinguishes today’s successfull businesses is the ability to adapt to changes in markets and customer expectations. Inspirational Where do you belong? Those who watch things happen, Those who wonder what happened, or Those who make things happen.