What is strategy?

Last week I started a new job as a communication strategist.  So a recent Forbes article entitled Here’s Why People Don’t Get Your Strategy immediately grabbed my attention.

The article’s author, Russell Raath, argues convincingly that the word ‘strategy’ is one of ‘the most used and least understood terms in business’, with the term often being ‘simply slapped on to make “plan” sound more sophisticated’.

It seems that anything that isn’t either implementational or administrative must now be labelled as strategic to indicate its elevated status, even when it isn’t warranted.

As a strategist I would argue passionately that having the right framework in place is vital to ensure success, but I’m equally very conscious that Strategy Without Execution is Hallucination!

Ultimately the activation output is all that people see.  It’s what businesses (and industry awards) are primarily judged on.  So in some ways it’s odd that strategy often seems to rank higher in the pecking order.

I don’t believe the confusion is deliberate though.  I think the majority of the problem with strategy is simply that most people don’t really know what it means, or how to create one.

Raath advocates three steps to avoid this confusion.  The first is to create a shared definition within your organisation of the terms ‘strategy’ and ‘strategic’, and be specific about their use.

That makes a lot of sense.  Anything that creates a common language and culture within an organisation has to be a good thing.  But it doesn’t actually answer the question: ‘what is strategy?’

Over the years I must have read hundreds of books and articles on this topic, but for me the best explanation is also the simplest:

In his beautifully concise video, Roger Martin advises that we “think of strategy as the intersection of two critical dimensions: where you will play and how you will win there.”

Where you will play is the set of decisions you need to make about where you will focus your efforts (and equally, where you won’t).  This includes factors such as regionality, target audience, product, and category.

How to win there is about understanding where you have a competitive advantage over your key competitors, then maximising that advantage by choosing specific activities that are different to the ones your competitors engage in.

Once these choices have been made it’s then a case of matching the two dimensions to create a single strategy, toggling between the two and iterating as necessary until you find the perfect blend.

I love the simplicity of this approach.  Just four steps in total:

  1. Choose where to play
  2. Find a distinctive way to win
  3. Match your choices
  4. Iterate as needed

As with all the most simple approaches though, putting it into practice is the hard part.

That’s when the fun starts.

That’s when you need a strategist.

Advertisements

4 thoughts on “What is strategy?

  1. Interesting but I think this only works after the question of ‘why?’ (I assume this has already been answered and people are agreed on the need for a strategy prior to the where and how questions?)

    Like

  2. I’ll rephrase it! Before you decide ‘where to play’ and ‘how to win there’ (good advice BTW), you need to ask the bigger question about whether you should be playing at all. In my eyes strategy is the ‘How To’ guide, it’s the thing that governs everything once the decision to do something has been made.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s