It is the challenges in life that make for stronger people. This remains true when it comes to businesses. Most major companies have strategic challenges they need to overcome in order to become successful. In an article for PwC’s strategy+business, Paul Leinwand and Cesare Mainardi explore what the successful businesses are incorporating into their strategy. There are five unconventional practices:
- Commit to an identity.
- Incorporate the strategy into the everyday.
- Remember work culture.
- Cut costs.
- Look to the future.
Evolving Past Old Strategy
Even if your company offers an array of services to a multitude of vendors, your identity should still remain clear. A good identity incorporates three elements: a value proposition, a system of distinctive capabilities, and a chosen portfolio of products that utilize the capabilities. Having a single identity does not mean that you will never change or adapt to your environment. Instead, it exploits your strengths to help navigate through the industry. When the entire company is committed to a singular way of creating value, then everyone is on the same page and work gets done.
The great companies have a tendency to devote their attention to a few capabilities that are worthy of investment. This allows for their full attention to be on what will create excellence, rather than focusing a little bit on everything. The companies will continually work to bring out the best in these capabilities. Additionally, these companies focus to make these capabilities their own.
Any good leader understands that how well a strategy does is dependent on the company culture. Culture is a difficult thing to control, but that does not make it the enemy. The company needs to have a clear vision of where they wish to go so that the employees can understand and support the strategic plan. The companies in this particular study view their culture as their greatest asset. They may all be different, but each of their cultures have blossomed from their distinctive strengths.
The companies that outshine their competitors spend the most money on what is important to them and cut costs everywhere else. They integrate costs and strategy to exploit cost management as a tool to help mold their identity. Even in times of financial hardship, costs are not slashed everywhere. They always have their core capabilities at the heart of their decisions.
Most of these great companies create capabilities that shoot them into the future, much further than they originally dreamed possible. They apply their capabilities to a broad range of challenges, which helps them to ultimately lead their industry. Additionally, they are not greatly disrupted by change because their capabilities present them with opportunities for expansion. They value their client relationship and work hard to avoid ever settling.
These five acts are unconventional for a reason; they go against what is taught in business school. The problem is that traditional approaches often lead to a gap between strategy and execution. If you really want your strategy to be a part of your organization, you need to have it be a part of every employee. You need distinctive capabilities that differentiate you and your organization.
The five acts can be interconnected and executed well together. For example, if your organization fails to commit to a single identity, they will likely be pulled amongst a variety of objectives. This lack of focus will never allow for the right capabilities to be developed, and you will never have what you truly need. These five acts ultimately create sustainable success, and that is what every business desires.
You can read the original article here: http://www.strategy-business.com/article/Creating-a-Strategy-That-Works?gko=d53a6