Where do I start with business strategy?
I say you start with what you know. Don’t make this more complicated than it needs to be. I always start with three things when I help teams start to develop their strategy. First, what are my core values? Core Values are the behavior rules for your business. If you don’t have them my guess is, you have behavior in your company that is limiting your success. Behavior challenges are the biggest challenges in most companies unless you have core values.
Starting with Core Values, think of an employee you LOVE (and I mean love) to work with, what is the ONE attribute you love about them? Do you have the same attribute? Repeat this four to six times and you should have a great list to start developing your core values. Next, use the list of attributes and figure out what you would like to name each of them. I suggest using a name that starts with a verb. For example, if the attribute “Caring” is on my list. How could I create a name for caring without using the word caring? I could name it “Show You Care” and I could define what that means to me and my company. Repeat three to five times and you have your core values.
The next thing is the purpose of my company. Some may say making money is my purpose but that is not a purpose, it is a result. You must figure out why you chose what you are doing to make money in your business. So, ask yourself, what does your company do? Once you know what you do, ask yourself, why is it important? Once you know why it is important ask yourself, why does it matter? Once you answer why it matters ask yourself, why is the answer I gave to the last question important? Again, why does that matter? If I keep doing this until I run out of answers I have the start of my purpose. The reason my company exists, is my purpose. A great example of this is “Enhancing Lives” which is an example from one of our clients. The purpose not only serves your customers but also serves the people in your company. “Enhancing Lives” is a great reason to exist and will drive many of your decisions with the people in your company and the people your company serves.
The third thing I work on is “Where is my company going in the next 10 to 20 years?” We use the term BHAG® or Big Hairy Audacious Goal. The BHAG® was first introduced to the world by Jim Collins in the book Good to Great. When thinking about the BHAG® think about where you want your company to be in 10 years. I use three things to help in this process. First, why do we do what we do in our company, our Purpose. I then want to think about the Macro Metric that guides my performance to profitability. We call this Profit/X, or my profit as the numerator and the element that drives the success of my business as my denominator. A great example of this is profit per bottle of wine if I am a winery. The last element I want to consider is what am I promising my customer we deliver? I could be promising quality, price or speed. A great example of this is product expertise. We are promising our customers we are the product use experts.
Once I know all three elements of BHAG® I try to think of how I can live our purpose, continue delivering the greatness we deliver, and how I am going to maintain my profit/x. I start drafting the BHAG® in SMART goal format. A great example of this is to have “30 office open by 2030” or “30 by 30” is the way it is used.
Now that I have my BHAG®, Core Values and Purpose I can start to create clarity in my company of where I want to go, how we will behave on our journey, and why we are on the journey we are on. I have a great start on strategy. To me these three items are the most important things we need to know as we execute our plans for the next year. When you know these three items it gives you clarity to check your plans for the year and see if they match up to how we expect our people to behave, why we exist and where we are going. Once these things are in sync your plans for the year will start getting done with a lot less effort then the past.