May 30, 2018

5 Powerful Business Strategy Tips to Fuel Your Growth [VIDEO]

May 30, 2018

5 Powerful Business Strategy Tips to Fuel Your Growth [VIDEO]

Business Strategy

Every year, we work with a hundred clients everywhere and anywhere, from Wellington to Toronto, and in one of our strategic sessions, Step Change chief Ashton Bishop was given a challenge: Out of all the strategy work that the team has done at Step Change, how can we add the most value in 5 minutes? Here’s his response to the 5-minute challenge with his five tips on strategy.  

 

 

The text below is an edited transcript of the video.

 

1. Start — But Don’t Stop — with Why

We’ve all seen Simon Sinek’s Start with Why video, which is the most popular business video of all time. For us, don’t just start with why —  be a purpose-led organisation.

Being purpose-led has value of upping the retention (where your staff are 3x more likely to stay) and upping the perception. 89 percent of customers believe organisations that live their purpose have higher quality product and also perform better. S&P 500 companies that are purpose-led outperform those that don’t by a factor of 10. The data is in, and it’s amazing what you can do when you belong to a purpose-led organisation.

A good purpose focuses you and guides your strategy. It gives you a clear vision of the change you want to see in the world and who you’re going to affect. It also gives you a lens to put your customer at the very centre — so your purpose doesn’t just live in the head, but also in the 'heart' of your organisation.

 

2. Make Choices

Great strategy makes the hard choices.

So why do we need strategy?

We need strategy because time, dollars, and focus are all scarce resources. Strategy lets us know where to apply these resources and how.

Remember what strategy actually is. Strategy answers the question, “Where do I apply scarce resources for maximum leverage?”

When we’ve made our strategic choices, we’ve made the choices that let us know what to do as well as what not to do.

Steve Jobs once said, “I’m so proud of what we did and achieved at Apple. I’ve even prouder of what we chose not to do.”

 

3.  Know Your Context

All strategy arises out of context. The biggest mistakes in business and military history come from applying previously good strategy to a changed context. You need to watch your context and understand what’s going on. Change is happening faster than ever before.

Today, organisations are still using SWOT analysis, where they are getting stuck and not going anywhere.

Here’s 3 reasons why the SWOT is not enough:

  1. You need to be specific. A SWOT is simply not specific enough. You need to ask very specific questions that go into the underlying opportunities and the challenges.
  2. You need to be time-bound. Opportunities and challenges are time-critical, and SWOTs have no measure of time inherent with them. We need to understand time to understand our context.
  3. You need to prioritise. You must know your top 3 opportunities and your top 3 challenges, and these must be very clear. Without alignment on context, you can't have a sensible discussion on strategy.

 

4. Manage Risk

Risk is both upside and downside. It’s neither good or bad. But what happens is that you never get compensated for taking dumb risk. So don’t do dumb.

A strategy is a hypothesis of how the world works. It’s a bet of how things are going to turn out. Look at each individual hypothesis, and check if it is essential or non-essential. If you’re wrong, does the whole thing fall over, or does it amplify things? Here we need to look at the confidence that we have that each individual hypothesis will prove true.

Once we’ve unpacked the risks, we can then identify the greatest risk with the lowest level of confidence and test the riskiest first.

This is applied in Lean principles and Lean Startup in action, but many organisations today aren’t testing the riskiest first.  

 

5. Get Aligned

All organisations tend to value alignment over agreement. You’ve got to be able to debate things with your team members, but at the end of the day, people need to fall in line.

So what is the best way to do this?

Leaders don’t need to have all the answers; they need to hold the space. This will allow surfacing of thoughts and ideas of the organisation while still getting alignment in the end.

Today, leaders trying to command and control, dictating and sequencing rollouts, will see that that is just not working. Why? Because the game today is discretionary effort. You need to have a central strategy so that the people in the front line can apply it to their area and their customers. The only way to do that is to get alignment and make it simple.

That sums up our 5 business strategy tips in 5 minutes. I hope you’ve found this helpful.

 

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