Strategy Process
Strategy:Broaden the base effectively
There has been an increasingly popular focus in considering strategy formulation and execution from a practice view point as opposed to a content approach. Strategy is not just something that organisations have but something that people within and outside organisations actually do. An observable trend in practice has been the widening of the participant base available to the strategy process.
One extension has been to have the Board (rightly) more involved in strategy development and execution. While this has been partly driven as an extension of the Board’s traditional control role to ensure management does not run amok with suspect strategic initiatives, it has also been promoted as part of a more service and resource based view of Board contribution.
Additionally, there has been a downward push in strategy process as management hierarchies are flattened and greater knowledge and perspective benefits are expected from involving more levels of management and more functional areas. It has also become a more supportable process with improvements in information technology. The two-way communication of corporate objectives, environmental analysis, voice-of-customer studies, and internal portfolio analyses have allowed strategy practices to draw in a greater proportion of organisation management.
The implication of this broadening of strategy participation is an exposure to a wider range of experience, skills and knowledge of strategy process. This will have an effect on how well strategy is undertaken and how to deal with varying degrees of confidence and participation. It has advantages but it will also bring risks if processes are not agreed and aligned.
A key requirement of organisational leadership must be to build a common understanding – not just of the specific strategic steps, but of the overall strategy practices and how they contribute to effective strategy development.
Rather than focus on how to complete SWOT templates or perform a competencies assessment, it would be better initially to discuss and agree upon a strategy process model and develop a shared understanding of how communication and alignment will be constructed. This needs to happen all the way from the long serving Chairman of the Board to the recently employed marketing assistant and management accountant- and all points in between.
In this regard, a one or two page Strategy Practices Document has proven useful. This sets out the specific strategy development and execution steps, the key time-lines, the expectations of participants, and where final sign-off will take place on each step. It can also include such minutiae as the shared meaning of common strategy terms and how strategy meetings are to be conducted. Agreement on matters such as the extent of prescriptive strategy and emergent/adaptive strategy should also be included. This document should be initiated, owned and communicated by the CEO.
While such a process doesn’t guarantee successful strategy outcomes, it is likely that without it, the organisation strategy process will be fragmented, ad-hoc, and result in pockets of frustration throughout various levels and functions. The way that strategy is conducted is a key precursor to what strategy is developed and how well it is executed.
About the Author
Hamish Stevens
www.hamishstevens.co.nz
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