Having defined strategy in the last issue, in this issue I will outline some techniques to be used in discovering strategy.
In the last issue I outlined and defined the concept of strategy as being the essence of how an organization exists and prospers. In this issue I will explore some techniques that are useful in determining strategy.
The Essential Components of Strategy
Having at some level defined the concept of strategy it is important to define the essential components of strategy.
While, as stated in the last article, there is one essential strategy that propels a successful organization forward, that strategy will be underpinned by a number of drivers, some more significant than others.
These drivers may include:
-- The core economic driver, how do we manage and utilize finances differently? In considering this driver Woolworths, Edgars and Pick 'n Pay are examples of three organizations which, while all high street retailers, utilize cash very differently.
-- The core human resource driver, how do we utilise people differently? Consider the Mines and Consulting organizations as two extreme examples.
-- The core market differentiator or value proposition, how do we present our products and services differently?
-- The core customer / market definition and segmentation, what adds the value customers pay for? Consider Woolworths and Jet as two retailers with different value propositions.
-- The core asset, what is the fundamental asset central to what we do and that differentiates us? Includes people, ships, trucks, shops, intellectual property, ore bodies, natural reserves, etc
-- The core technology / capability, what is the fundamental technology or capability that is central to what we do and how we differentiate our business? Retail, wholesale, distribution, agency, broking, specific services, mining, etc. Might be I.T. in SOME cases -- much less frequently than many people think.
-- The essential reason the organisation exists, why did the organisation come into existence? What keeps us going? What is the difference we want to make in the world / society? What is the value we want to add to our customers?
-- Core values, what are our essential values? Moral and ethical parameters that constrain and guide us.
-- Other, is there anything else that we consider absolutely essential to why this organisation exists and how it creates differentiated value? Might include I.T.
Pointers to The Essential Components of Strategy
The optimum approach to determining strategy and strategic drivers is a series of formal strategic analysis and design workshops with the top leadership of the organization which uses some of the techniques discussed in earlier issues of StratNews to systematically analyse the above drivers and analyse the strategic environment in a structured manner and from this develop a set of prioritized action plans.
However, if you are currently involved in leading a project, such as an I.T. project, and need to get a clearer view of corporate strategy there are a number of techniques that you can use.
One of the challenges that I face as a consultant seeking to advise clients on I.T. projects and investments that are not meeting expectations is to clearly understand corporate strategy as quickly as possible. Accordingly I have identified a number of ways that can be used to assist in achieving this objective.
How to Get a Quick Indication of Corporate Strategy
The following are some quick indicators of corporate strategy:
-- The consistent message in advertising and marketing (consistency is an indication of strategic clarity and maturity).
-- The aspect of the business executives talk about when socialising.
-- What gets the CEO really angry when compromised?
-- Why you joined the organisation and why you stay.
-- The first thing you were told on joining the organization that has stuck.
-- What you would say if someone asked you to describe your organisation from your point of view?
-- What do you think keeps customers coming back?
If some of these items all point to a consistent theme, this MAY be the essential strategy of the organization. If they all point to different themes then they do not necessarily give any indication of strategy.
Some Useful Pointers To Strategy
In addition to the obvious but seldom asked question "please tell me what the essential strategic driver of the business is?" and "What is the essence of what differentiates the business?" some questions that I find useful in order to obtain a quick initial indication of the strategic driver include:
-- "Please briefly describe the organisation from your perspective" this is one of the most informative questions to ask any business executive or business person. Many executives when asked this question will talk about the organization strategically.
-- "Please tell me the things that most concern you most about the organisation at present". Many executives when asked this question will talk about the things that are getting in the way of the strategy of the organization.
In both cases listen carefully to the answers and analyze them carefully, they can be very informative.
On a number of occassions I have found these questions particularly useful when an organization is in pain with an I.T. project that is negatively impacting customers. Often in such cases it turns out the the software or the software vendor or the project is misaligned or not aligned at all with the strategy of the business. Such misalignment of I.T. can cause severe damage to a business.
Conclusion -- Determining Strategy
The above questions may assist you in discovering the core strategic driver in a short space of time.
A formal strategy determination method is to be preferred and this will be discussed in the next issue of StratNews.
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Dr James A Robertson -- has been involved in the effective application of Business Information Systems, including but NOT limited to ERP, since 1987 and in the profitable and effective use of computers in Business since 1981.
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About Dr James A Robertson PrEng -- The Business Systems Doctor -- and Other Topics
Catalogue of Major Business Information System Failures
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Survival of the fittest – why it makes sense to measure the pulse of your business
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Sample Pulse Measurement Reports
Strategic Essence: The Missing Link in Business Information Systems
Strategic Essence: Overview
Strategic Essence: Part 1 -- Strategy Defined
Strategic Essence: Part 2 -- Differentiation
Strategic Essence: Part 3 -- The Essence IS Different
Strategic Essence: Part 4 -- The Essence should be the Point of Departure
Strategic Essence: Part 5 -- Discovering Strategic Essence
Strategy -- the Essence of the Business: What is it and how do you develop actionable strategic plans?
Simple Steps to Increase the Strategic Value of your ERP Investment
Free Strategic Snapshot Toolset and Manual
A strategy focused planning system beyond traditional budgeting
Tough IT and ERP Procurement and Contracting that Works
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092 Doing things differently and better -- ASCO Case Study 2-- BPM Summit 2013
088 Strategic ERP Invesment -- ASCO Case Study -- Service Management Conference and Exhibition Africa
026 Information Architecture and Design of FIS for Rennies Group -- Financial Information Systems Conf
018 CRM Risk Control: Designing and Implementing an Integrated Risk Mgmt Sys -- Integrated Risk Mgmt Conf
011 V3 Consulting Eng: Benefits of MIS to Professional Practice -- SAICE 15th Ann Conf on Computers in Civil Eng
Strategically Enriching your Business Information Systems
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A Moral and Ethical Dilemma -- Systems that Fail
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