One of the more provoking articles in my study is Collis & Rukstad (2008) “Can You Say What Your Strategy Is?” which was published in the HBR. It is provoking because as a CEO it really challenges you to be able articulate your organisation’s strategy. It also drives home the reality that in many organisations the people charged with executing the strategy do not have a ‘clear line of sight’ in terms of understanding how to do their jobs within the strategy.
If you, as CEO can’t succinctly articulate your strategy, how can you expect your managers or staff to do so?
Collis and Rukstad offer the following hierarchy of company statements as a guide for the use of the key terms used in strategy. The correct use of which will result in a concise strategic statement which covers scope, objective and advantage.
An example of a good strategic statement is given;
“grow to 17,000 financial advisers by 2012 [from about 10,000 today] by offering trusted and convenient face-to-face financial advice to conservative individual investors who delegate their financial decisions, through a national network of one-financial-adviser offices.”
In this example you can clearly see what the goal is, what the advantage is, who the exact customer is and how they are going to deliver it.
In the article the authors use a great analogy where they describe an organisation as a collection of iron filings sitting on a sheet of paper.
“Think of a major business as a mound of 10,000 iron filings, each one representing an employee. If you scoop up that many filings and drop them onto a piece of paper, they’ll be pointing in every direction. It will be a big mess: 10,000 smart people working hard and making what they think are the right decisions for the company—but with the net result of confusion. Engineers in the R&D department are creating a product with “must have” features for which (as the marketing group could have told them) customers will not pay; the sales force is selling customers on quick turnaround times and customised offerings even though the manufacturing group has just invested in equipment designed for long production runs; and so on.
If you pass a magnet over those filings, what happens? They line up. Similarly, a well-understood statement of strategy aligns behaviour within the business. It allows everyone in the organization to make individual choices that reinforce one another, rendering those 10,000 employees exponentially more effective”
This is a great read for any CEO or manager and can be downloaded from this blog.